Analysis: Reshaping local authority services

Directors of children's services are grappling with budget cuts on an unprecedented scale. Where once central Government may have trimmed a few percentage points off their budgets, this time around they are facing cuts as great as 40 or 50 per cent. So far, local authorities' responses vary, and with that their chances of success in this new era of service delivery.

Encouragingly, some local authorities are working to protect their children's services, among them the London Borough of Tower Hamlets. Although all short-term projects will be lost in the next financial year, most of the authority's core team and core work will continue for at least another year.

'The local authority recognises the significant contribution that early years makes to progress and achievement throughout children's education,' says Tower Hamlets early years manager Julian Grenier. 'The benefits of investment in the early years to both children and families are well documented locally and nationally, and the borough is well known for its commitment to early years.'

Far from cutting services, Essex is planning to increase its investment in early years and childcare services by 26 per cent. The expansion has been made possible by redesigning the early years and childcare services and saving £1.7m through restructuring its residential care services.

Not all authorities, however, are being so reflective or strategic. Some are taking a 'slash and burn' approach, making dramatic and wholesale cuts to services, while others are simply 'salami slicing', applying the same percentage cut to every section in every department of each directorate.

While some may justify salami slicing on the grounds of fairness and argue that it spreads the pain equally, it is only a reasonable option for one-off budget cuts of 1 per cent or 2 per cent.

Applied on the scale that is required today, salami slicing will only weaken services to a point where they are unable to function. Some services will be present in name only, able to complete the processes but unable to deliver outcomes.

By salami slicing, local authority leaders risk abdicating responsibility for making decisions, leaving middle managers to implement the cuts and take the blame for the subsequent fallout - a tack taken by central Government itself as it devolves responsibility for the cuts to local authorities.

A NEW KIND OF FUTURE

Thankfully, many authorities are being strategic rather than reactive. Everyone is struggling to understand the new agendas (and the new jargon), and no-one is saying, 'We've got it right', only 'This seems to be the way forward for us at the moment'.

However, the more successful authorities know that they and the rest of us are facing a new kind of future. They recognise that the changes being made now by the Government in terms of localism are the most far-reaching made in our lifetimes.

They appreciate that the cuts will have to be made against a backdrop of organisational challenges for local authorities, caused by new technology, globalisation, demographics and changes to human resources management.

The most creative heed the likes of a Price Waterhouse Cooper report on the future world of work, which cautions, 'The future is not a place we go to, but one which we create, and while things happen that we cannot predict, we can still be prepared.'

They agree, too, with Barack Obama's aide, Rahm Emanuel, and have decided, 'We're not going to let a good crisis go to waste.'

As a result, most local authorities are changing their business models across all their services, not just education and childcare. Three business models are emerging:

• - Local authorities merging all their services
• - Local authorities sharing responsibility for one specific strand of their work
• - Local authorities making fundamental changes to business strategies to meet local needs.

A few authorities are planning to run their operations through 'traded services', where schools are offered a menu of services, some of which are chargeable. I hope to be interviewing some colleagues from these local authorities in upcoming issues.

Directors of children's services acknowledge that there is a lot of overlap between their directorates and across departments. Where people are working through the cuts intelligently, and with a view to achieving more effective services with fewer resources, it is likely that they will be able to deliver what families and children need.

'It's fair to say that an approach at a national level that puts more emphasis on the professionalism and autonomy of staff in the early years is long overdue,' says Julian Grenier. 'We have been struggling with too much central direction and too many projects for a long time.'

But he warns, 'This change is happening too quickly - we need a tapered reduction in funding and direction, not this sudden cutback.'

The Deloitte report Leadership at All Levels (www.deloitte.com) found that local authorities were consistently failing to deal with under-performing staff, identified as 15 per cent of their workforce. Deloitte recommends reshaping local authorities. But redesigning the entire service at a time when many authorities have already been through multiple restructures would be risky.

Many local authorities are currently focusing on the delivery of outcomes, rather than simply the processes - a long-standing problem. So, rather than concentrating on the quantity of Common Assessment Frameworks completed, for example, authorities are looking at what is actually being delivered to children and families.

What emerges will be all the better if authorities pool their expertise. 'It's the relationships that help people change things,' says Helen Jenner, director of children's services at the London Borough of Barking and Dagenham (see below). 'It doesn't matter what systems you have in place if people don't talk to each other.'

Pauline Hoare is a senior adviser at Cordis Bright, which works with local authorities and third sector organisations to improve services and outcomes. She runs the Cordis Bright Early Years Network for local authority colleagues. www.cordisbright.co.uk

AFTER THE CUTS

The cuts have happened. How do we deal with the consequences? Helen Jenner, director of children's services, London Borough of Barking and Dagenham, in conversation with Pauline Hoare, senior adviser, Cordis Bright

Pauline: Local authorities are facing unprecedented budget reductions from central Government. How do you feel about the cuts?

Helen: Although our services have been badly affected, we decided there is little to be gained by simply complaining about the cuts. We needed to find creative ways to make the most of a very difficult national and local situation. For some time we have been planning how to sustain children's centres and the invaluable work they are doing for children and families. While we have had to cut some funding from our overall budget for early years, we are aiming to make up for the potential shortfall by linking children's centres with our multi-disciplinary teams, so that they become an integral part of a universal early years offer and also provide a platform for effective early intervention.

Pauline: How will that work on the ground?

Helen: Our multi-agency locality teams meet every Friday with a focus on outcomes, not process. They provide a strong, stable operational base for our work, both the universal offer and targeted support.

Pauline: And does that work link to the Children's Trust?

Helen: The Children's Trust is a very strong organisation in Barking and Dagenham. The Government cuts have severely challenged us, but also driven us to focus integrated efforts to ensure that we have properly tailored services to needs. Our Children's Trust covers a range of issues - for example, the Safeguarding Board feeds into the Children's Trust and so does the children's Health and Wellbeing Board. Reporting moves both ways. All this works for us because we have strong representation from all the agencies involved and buy-in at strategic level.

Pauline: And how is health involved?

Helen: We haven't neglected the operational level. Our children's centres have strong health visitor links, and that wasn't an easy process. When the PCTs were commissioning children's services, we made sure that the CAF was a key part of the process.

Pauline: This sounds really effective. What's the secret?

Helen: There isn't a magic formula for the systems and processes. It's relationships that make people change things. It doesn't matter how many systems you have if people don't talk to each other. One way of looking at our situation is to say that while we have had to reduce budgets, we have done some of that by removing overlap, and ensuring every available pound is effectively spent.

Pauline: What's been most difficult during this process?

Helen: There are always challenges. Some of our problems seem particularly intractable. It's easy to get frustrated when people don't seem to know things that you hoped they would. It's been hard to convince some specialist staff of the importance of children's centres to their work. Social workers and health visitors are beginning to work in children's centres now, and that's a real bonus.

Pauline: What is the future for children's centres?

Helen: The future will be challenging for children's centres. If they stick with the universal offer, they run the risk of missing families who need their support. If they focus on disadvantage, they run the risk of pathologising the service. We have to think outside the box to sustain children's outcomes. From the beginning, both Sure Start and children's centres came with a very strong set of restrictions. It may help us to have more freedom.

Pauline: What's wrong with making the same cut to every department and area?

Helen: Salami slicing is a very bad idea. It makes your service weaker and weaker, you lose priorities, and interventions progressively lose their effectiveness. Salami slicing amounts to avoiding making decisions at the top level. It's only OK if there is plenty of fat.The senior leadership needs to brutally honest about overlap of services because if you can't cut 10 per cent off social care, then other areas will need a bigger cut.

Pauline: So where are we now?

Helen: The current situation will force LAs to think more strategically and across all directorates. We have lost some of the flexibility that additional funding gave us, but are having to really improve our analysis and decision-making. Members have the most difficult dilemmas - do we prioritise places for children or housing? Can we fund both? The strategic decisions are very difficult, they're often 'wicked problems' with no very clear pathways to a solution, and we certainly have not found all the solutions. We have many improvements still to make, and with less money this will be harder. The creativity and commitment of our workforce is essential. We are all committed to making a bigger difference in Barking and Dagenham by intervening early.