Productivity Plan - Barriers preventing activity that the government can help to reduce or remove

What are the barriers preventing you from improving productivity and services further? 

Are these barriers consistent across multiple services? 

What would you need to remove those barriers? 

What do you need from government, the market, or elsewhere?

The most significant central barrier to local productivity is single-year finance settlements. Without a clear indication about funding for multiple years, councils cannot plan and deploy their resources as effectively as possible. The sector needs longer term certainty about its funding to be able to plan for transformation effectively.

We have also been hampered by the tendency of Whitehall to design and decide policy that affects councils without engaging with the sector as fully and as early as it could. This has resulted in initiatives and funds that are more complicated than necessary and that are difficult and, in some cases, costly, for councils to implement. We strongly support much closer policy co-design between central government and local councils.

We would also benefit from much greater flexibility for our council (and all councils) to decide how to raise and spend money locally. Central prescription and ring-fencing constrain our ability to allocate our resources effectively.

We incur unnecessary spending and waste valuable officer time in complying with rules, requirements, restrictions and processes imposed by central government and regulators. These include:

• the number of specific, formula-based revenue grants and their separate reporting requirements – it would be much simpler and more efficient to roll all specific grants into a single provision in the Local Government Finance Settlement
• the wide range of separate one-off revenue and capital grant pots with onerous, costly and counter-productive bidding processes
• the lack of long-term rent policy (and tendency to deviate from agreed policies) makes it difficult for stock-retaining councils to set a viable and sustainable 30-year Housing Revenue Account (HRA) Business Plan
• complicated, inconsistent, and misaligned processes for submitting data returns to central government
• lack of join-up between central government departments on issues including housing, homelessness prevention and asylum dispersal
• numerous statutory requirements to place notices in newspapers or issue written copies of routine notices
• excessive amount of information that is required in annual accounts or has to be published under the transparency code
• statutory overrides such as the requirement to value assets for accounts every year
• regulatory bodies seeking “to the letter” compliance with their statutory codes
• backstop to get old accounts audited. CIPFA stated that they are reviewing this requirement. However, to avoid wasting unnecessary time and cost, we need clarity on this
• national audit function needs to work more effectively

Investment in core corporate functions to enable WBC to operate more effectively. In the past, these have been stripped back to protect funding for frontline services. But these are key to enabling transformation and effective decision-making and require investment.

Another barrier is the increasing need to pay for technology through revenue budgets rather than capital, with the ongoing move to the cloud. This places further pressure on budgets. Productivity is lost through inadequate and badly designed sector technology. Although the DLUHC digital team have made some headway, in particular in planning, councils are too small to influence an applications market which has insufficient competition, innovation, or user centred design.

Suppliers are also frustrated with complex procurement processes and too many bespoke requirements from councils.

More government software build, clearer sector standards, significant funding injection with fewer funding pots and a longer term approach to legislative change would improve sector productivity through technology. 

In terms of prevention, one of the biggest potential contributors would be an expansion of housing supply, which requires a rethink of the planning system and the regulation of the housing market.

Additionally, other key policy areas that government could prioritise are:

• investment in skills development to support key local government services, for example, in planning, social care and housing
• a publicity campaign that seeks to promote the valued services provided by councils and boost the sector’s reputation in order to support careers in local government