Battling the cuts: lessons from Northamptonshire

In the face of unprecedented financial pressures, councils have something to learn  from military tactics employed by former prime minister Winston Churchill during World War II, says Christian Wall.

There are many lessons that could be learnt – or more accurately, relearnt – from the plight of Northamptonshire County Council.

Amid the recriminations and inevitable blame game, there is a risk that the fog generated by the claims and counter-claims about operating models, governance and funding obscures important lessons that every authority, no matter how well run, should heed.

One of these has to be the importance of good financial management in light of a coherent council strategy.

Another is the protection the section 151 officer should be afforded in the execution of his or her statutory role.

Contrary to some commentary, the first section 114 notice issued by Northamptonshire did not come as a surprise to many.

It has been widely reported in late 2015 that Matt Bowmer, the then section 151 officer, had threatened to issue a notice.

Anyone who read the council’s subsequent financial reports would have discovered a litany of overspends and failure to deliver savings.

Recent revelations have shown just how accurate Matt Bowmer’s assessment of the council was.

It is difficult to overstate the complacency exhibited by some of those running the authority.

Far from being delivered efficiently and at low cost, many services were expensive given their poor quality, while others simply underfunded.

Those who questioned the council’s financial sustainability were assured savings could be found if needed.

Learning from history

Management by assertion is common, but in finance, where evidence is plentiful and consequences dire when reality intervenes, such behaviour is inexplicable.

It is hard to escape the conclusion that Matt Bowmer was hung out to dry, and the system afforded him no protection when his statutory role mattered most.

Despite the second section 114 notice, some inside and many outside the council still do not, or will not, understand the severity of the situation.

Virtually every “cut” has faced significant opposition, and plans to cut the libraries service could best be described as a fiasco, with the latest iteration being rethought in light of judicial review.

However, this state of affairs was not inevitable.

Military analogies are rarely relevant, but occasionally, they throw light on otherwise opaque concepts.

Alan Brooke, Churchill’s chief of staff in World War II, had much to say on defining military strategy.

He stressed that: objectives need to be identified; the requirements those objectives create be assessed; the potential and actual resources available to meet those requirements be measured; and from that flows a coherent pattern of priorities and a rational course of action.

Substitute “outcome” for “objective” and the relevance is clear: councils deliver outcomes and financial resources are allocated to help achieve them.

In other words, budgets are not an end in themselves, but the rational response to events and circumstances.

Facing the challenge

Other than a vague aspiration to achieve former environment secretary Nicholas Ridley’s ideal role for local government, circa 1987, there is nothing that sets out what Northamptonshire was trying to achieve, let alone the outcomes.

Few councils can honestly say budgets are focussed on what matters most.

One might harshly say some have resisted cuts and council tax increases until the point of desperation set in.

However, the phrase “he who defends everything, defends nothing”, is very pertinent here.

Although some services, such as highways maintenance, have been cut consistently across the country, this often smacks of political and financial expediency in the absence of long-term strategy – poor maintenance can be costly to remedy in the long term, to which many turn a blind eye.

Authorities like Warrington have shown that a focus on outcomes that help alleviate financial pressure can be achieved, in Warrington’s case using outcome-based budgeting.

Tactics determine how a battle is fought and in local government, a convincing narrative is often the tactical key to success or failure.

Cuts, even to libraries, can be accepted, but allowing MPs, journalists and others to run amok and blame council incompetence and “waste” puts them on the high ground, and once there, impossible to dislodge.

Northamptonshire was mismanaged, however most other councils are not.

Councils have to both establish that narrative before others do, and consult on its formulation; covering both outcomes and budgets, to gain greater acceptance and reduce the scope for judicial review.

Used well, modern marketing techniques are a boon to helping councils navigate what matters most to residents and what they are prepared pay.

Faced with stark choices, residents will often agree to slay sacred cows and raise council tax.

After eight years of austerity and little respite in sight, many councils are struggling.

Fighting on all financial fronts is unpleasant and being a section 151 Officer in this environment is particularly difficult.  However, councils should do more to help and protect them.

Christian Wall is director and head of local government at consultants PFM

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