• Home
  • About
  • Subscribe
  • Conference
  • Events Calendar
  • Webcast151
  • MOTB
  • Log In
  • Register

Room 151

  • Treasury
  • Technical
  • Funding
  • Resources
  • LGPS
  • Development
  • 151 News
  • Blogs
    • David Green
    • Agent 151
    • Dan Bates
    • Richard Harbord
    • Stephen Sheen
    • James Bevan
    • Steve Bishop
    • Cllr John Clancy
    • David Crum
    • Graham Liddell
    • Ian O’Donnell
    • Jackie Shute
  • Interviews

Localis chief executive on catalyst councils

1
  • by Jo Tura
  • in Interviews
  • — 14 Sep, 2012

Alex Thomson previously worked in the civil service, latterly at the Department of Communities and Local Government and has been the chief executive of Localis for two years. The think tank has just released its report Catalyst councils: A new future for local public service delivery.

Room 151: How can government encourage local public sector partners to “participate in the pooling of resources and funding”?

Alex Thompson: The big answer to that is Community Budgets and a more holistic approach. Early intervention would make better use of scarce resources and is a gateway to getting people involved. The noises I am hearing about Community Budgets are pretty positive. I’m not sure it’s that people haven’t got their heads around them, it’s more that there needs to be the will to make the change.

Room 151: You cite Essex and Shropshire as councils with pioneering trading companies. Is there a feeling that other councils are willing to undertake this sort of entrepreneurialism?

AT: Some of the examples, I think Surrey is one, go back years so the concept has been around a while now. It’s a good thing to do and people seem to be saying ‘if they can do it why can’t I?’. People are pushing on down this road and local authorities will have to be more entrepreneurial. There is a feeling that we are moving in the right direction.

Room 151: Can you put any time scale on how long it might take to get to the position where councils are using the full range of innovation you talk about?

AT: No one does the same thing nor should they because every area is different in terms of their needs and the requirements they face but also in terms of their leaders. They’re elected to make decisions and they stand accountable for the decisions they make with the ballot box. But I wouldn’t be surprised if in five years we weren’t a long way down that road and in ten years time the landscape could look completely different to where we are now. I think that’s reasonable.

Room 151: 65% of councils responded that nudge theory could be the “single greatest opportunity” to reduce costs. Can you give us a couple of examples of this?

AT: The 65% finding is from an Impower report. The concept of nudge is about changing behaviour so that you drive down demand for service. Making what you do more efficient is tremendously useful and helpful, but if you can prevent the demand for a service or lower a demand for a service in the first place that is the biggest win of all. Nudge is using social norms to change the way people behave: so instead of telling people what to do you inform them that lots of other people do ‘the right thing’. That’s a crude characterisation. So people feel ‘if that’s what everyone else is doing then I should be doing it as well. That’s the idea behind it, simply-put. So the phrasing of requests is quite important. We think there are opportunities there for local government. One is that there is a chunk of funding on public health which is going to transfer to local government shortly. So can authorities find different ways of messaging to their residents to stop them from smoking.

An example that Impower reports on demand management is special educational needs transport where something like 120 parents in an area rather than using the long standing council service, chose to drive their own children to school with a personal travel budget for it. Some people became independent altogether and the result was a saving of something like 15-20% of the budget. Just by recasting the way people look at it.

Room 151: What did you find were the main barriers to the use of Social Investment Bonds?

AT: They’re risky by definition because you’re putting money upfront in the hope that there will be a return; there’s a risk in that. And there’s always a risk that it’s not as easy as one would like. People want a greater return depending on how risky they perceive an investment to be and that isn’t always easy to get.

There is also the policy risk aspect of it, it’s a new way of doing things. What we note in the report is that where there is SIB in the UK, Peterborough Prison for example, support has come from elsewhere like Lottery money, for example. The point being that the model is not at the stage yet where it can stand on its own two feet. It’s very early days for that stuff but the potential is there.

The other barrier here is about measuring outcomes. What outcomes are you getting? How do you measure them? Are you sure you can attribute changes in outcomes to the intervention? That is where it becomes really complex.

Room 151: Is there a solution to the cost and complexity of Community Asset Transfer? You mention long lease transfers?

AT: The short answer is there is no simple answer. I remember looking at this two or three years ago and even back then the last government made lots of positive noises about how they were going to write a report, and there was lots of interest, but there wasn’t a lot of it going on.

Complexity is the number one thing and cost is a little below. From a legal and organisational standpoint you need to be careful. Local authorities are guardians of a public asset and you need to be very careful about how you go into it.

The organisations in question needs to be comfortable that they have the capacity to manage the assets. There’s also the question about how long term it is, you don’t want to be relying on an organisation which has one or two inspirational people which would fall apart if they weren’t there. You need to be sure you know what you are doing.

The follow on from that is one good way of approaching it could be not to transfer the asset in its entirety. Don’t transfer ownership wholly because then you have lost control but if you do it on a long lease you can always bring it back if things were to go wrong.

Part of the work the local authorities need to do to make this happen is not just assess things, the capacity of a given organisation, for example, but to help build that capacity. That said, there are plenty of examples going on right now. In libraries for example lots of councils who have less money for libraries than they had before have looked at them and thought let’s let local groups help run them, the library is then not shut but the council isn’t funding the staff.

Broadly speaking though we do thoroughly applaud this. Giving communities something to do to play a role supplying services that may not be financially viable for a local authority to do is a good thing – it’s the right thing to do. Roughly speaking once an asset goes it’s not coming back, so keeping it going is the trick.

Room 151: Tell us about your ‘Commission on better commissioning’ idea.

AT: The government has announced the idea of a commissioning academy and we thought that local government, central government and the LGA should form a commission on better commissioning. There’s still plenty of confusion and people are not quite sure what they can and can’t do with EU procurement.  A lot of this is a new landscape: it’s not just, here’s a contract, walk away. It’s about commissioning in a smarter way so there is shared risk and reward and getting that right is a real art form.

Finance directors and others need to be confident they’re striking the right deal and there’s good value for money, potential return via growth and flexibility so that contracts can be changed. Not everyone has been doing that.

Share

You may also like...

  • Caroline Cunningham on the County Councils Network Caroline Cunningham on the County Councils Network 9 Jul, 2012
  • Rob Whiteman on combating the complacent Rob Whiteman on combating the complacent 2 Apr, 2014
  • Matt Bance on multi-asset investing for treasurers Matt Bance on multi-asset investing for treasurers 7 Nov, 2013
  • Darra Singh on salami slicing, stress testing and service provision Darra Singh on salami slicing, stress testing and service provision 12 Jun, 2012

1 Comment

  1. Cashperform says:
    2012/09/14 at 10:22

    As Vice chair of a high school I had the privilege to sign off on an £18m Building Schools for the Future (BSF)modernisation project that incorporated a community library onto the school campus. That was two years ago.Was it a success? Yes on at least three levels namely the school had access to vast resources including the latest technology and book stock.The community benefited from a modern facility and one where they could integrate and communicate with the ‘younger generation and finally the cost was dramatically reduced as two libararies became one.
    Regarding the point on SEN and the use of transport I would like to point out that this arrangement really can work if the the schools cluster (feeder primary schools to a high school) co-ordinate their approach such that all such transport is undertaken by parents/providers and that includes trips to events/swimming pools/sports activities etc etc.

    Log in to Reply

Leave a Reply Cancel reply

You must be logged in to post a comment.

  • Register to become a Room151 user

  • Latest tweets

    Room151 7 mins ago

    Could 2021 be less eventful for LGPS, please?: Barry McKay looks at McCloud, the 95k exit cap, employer risk and investments to see what to expect for LGPS in the coming year. On one hand, 2020 was in[...] dlvr.it/RtslFd pic.twitter.com/H4debuPmGG

    Room151 7 mins ago

    Fixed income investing can help target both financial and sustainability targets: Sponsored article: Adam Whiteley offers a guide to the ESG benefits of investing in fixed income. Investing responsibly in fixed income can be crucial for local government… dlvr.it/Rtsl9h pic.twitter.com/khJL1xNfGh

    Room151 1 day ago

    Going beyond the standard metrics for climate change: Sponsored article: With climate change an investment imperative and an imminent reporting requirement, Ritesh Bamania argues UK pension schemes should look beyond today’s standard metrics. With… dlvr.it/RtnpLS pic.twitter.com/6ABaFHyS9I

    Room151 2 days ago

    LGPS webinar: Governance the key to TCFD implementation: LGPS funds have been warned that governance is it at the here of Whitehall plans to impose a new climate reporting regime on pension funds. In January the Department for[...] dlvr.it/RtjwNq pic.twitter.com/YMiMdmRyzU

    Room151 2 days ago

    LGPS webinar: Central bank management of bond purchasing could affect all asset classes: When the government debt caused by the pandemic is eventually tackled there may be a huge impact on assets of all classes, according to a leading investment expert… dlvr.it/RtjwJx pic.twitter.com/7v8K5vMYHo

    Room151 2 days ago

    #LGPS readers...what to do about #bonds? room151.co.uk/blogs/lgps-web… @BrunelPP 's new CIO, David Vickers tackles a problematic area #centralbanks #assetallocation #fixedincome pic.twitter.com/yUJr0azbKv

    Room151 2 days ago

    LGPS Challenges: Balancing Realpolitik and responsible investment: Elizabeth M. Carey warns of the perils of an ESG echo chamber as countries outside the West continue to invest in fossil fuels. Anyone working with the LGPS probably feels[...] dlvr.it/RtjMpq pic.twitter.com/MykIYxuYri

    Room151 6 days ago

    How can local government ‘build back better’?: Beverley Gower-Jones looks at the options for driving small business entrepreneurship in clean technologies. Innovation is essential for local authorities to save money and reduce emissions, it is the… dlvr.it/RtT3nS pic.twitter.com/bSMB6OG70t

    Room151 6 days ago

    Helen Randall: Spelthorne report places spotlight on ‘controls’: Fresh criticism of Spelthorne Council raises the question of what “good” controls look like when negotiating a property deal. Spelthorne Council’s continuing debacle over property… dlvr.it/RtSPhy pic.twitter.com/9uCOJgBcH6

    Room151 6 days ago

    Step-out strategies: Hitting the sweet spot between liquidity and ultra-short duration: Sponsored article: Jemma Clee describes how an ultra-short duration strategy can help local authorities enhance returns. Despite the expectation of a low, and… dlvr.it/RtSPZb pic.twitter.com/pdXPpv5lcN

    Room151 7 days ago

    What role will climate change have on the pricing of government bonds?: Sponsored article: Kerry Duffain finds that “vulnerability and resilience to climate change” have a significant impact on the cost of government borrowing. Ardea Investment… dlvr.it/RtNKv7 pic.twitter.com/wDjT31x4Yt

    Room151 1 week ago

    ESGenius: Slashing emissions will fuel green growth for decades: Sponsored article: Velislava Dimitrova argues that a big enough investment could mean transition to a low, or no, carbon economy can become a reality. The world needs to slash carbon[...] dlvr.it/RtKZJp pic.twitter.com/cd8S3ijERl

    Room151 1 week ago

    Prudential code: “Not perfect, but its heart is in the right place”: The new Prudential Code offers revised rules for borrowing. Nikki Bishop is sceptical it will work while Gary Fielding offers his support. Nikki Bishop I have been asked to give[...] dlvr.it/RtKZFh pic.twitter.com/OriN28lXcb

  • Categories

    • 151 News
    • Agent 151
    • Blogs
    • Chris Buss
    • Cllr John Clancy
    • Dan Bates
    • David Crum
    • David Green
    • Development
    • Forum
    • Funding
    • Graham Liddell
    • Ian O'Donnell
    • Interviews
    • Jackie Shute
    • James Bevan
    • Jobs
    • LGPSi
    • Mark Finnegan
    • Recent Posts
    • Resources
    • Richard Harbord
    • Stephen Fitzgerald
    • Stephen Sheen
    • Steve Bishop
    • Technical
    • Treasury
    • Uncategorized
  • Archives

    • 2021
    • 2020
    • 2019
    • 2018
    • 2017
    • 2016
    • 2015
    • 2014
    • 2013
    • 2012
    • 2011
  • Previous story DCLG stats show allocations up to money market funds and ‘rest of world’ deposits
  • Next story Borrowing and investment data 2011/12

© Copyright 2021 Room 151. Typegrid Theme by WPBandit.