The Minister for Finance and Government Business asked the Public Policy Institute for Wales to analyse the impact of reductions in central government funding for councils in England and to identify potential lessons for Welsh local government. This report provides an overview of the impact of budget reductions in England and a thematic analysis of the strategies used by councils to mitigate the effects of the cuts.
Local government funding in England is estimated to have been reduced by 25% between 2010-11 and 2015-16. In response, councils have used three broad strategies to cope with the cuts:
- Initially most councils cut costs by withdrawing or scaling back services (‘doing less’) and/or improving efficiency (‘doing things better’).
- Some also drew on reserves to maintain services and make up the shortfall between income and expenditure.
- As they reached the limits of what can be achieved through streamlining and eliminating waste, they have adopted transformative approaches to services delivery (‘doing things differently’) and introduced new ways to meet the needs and aspirations of citizens and service users (‘doing different things’).
The report suggests that Welsh councils may gain helpful insights from the strategies adopted by local government in England. Professor Steve Martin, Director of the Public Policy Institute for Wales and co-author of the report, said:
‘The cuts in Welsh councils’ budgets announced this week aren’t as deep as some of us feared, but councils will need to prioritise in order to balance the books. They need to be clear about what they can afford to provide in future. Experience from England suggests that they will need to develop new ways of working, make better use of data and share services with each other’.
To view the report, click here.