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local government re-organisation: successes and warnings

19 November 2018

This article is taken from November's public matters newsletter. Click here to view more articles from this issue.

Re-organisation continues to be a hot topic of conversation in local government with new stories appearing on an almost daily basis regarding local authorities exploring opportunities to restructure, whether that be through moving to a unitary model, or the establishment of combined authorities. But does restructuring actually provide the benefits that it is touted to? In this article, the second in our local government re-organisation series, we take a look at some of the success stories and some warning signs from local authorities who have moved or are proposing a move to a unitary model.

Success stories

  • Cornwall Council: it was reported earlier this year that an independent review of Cornwall Council undertaken by the Local Government Association had found numerous positives in terms of progress made by the council since moving to a unitary authority. Particular areas highlighted were the fact the council had managed to deliver circa £300 million in savings to meet cuts to national funding whilst also still being able to meet the needs of its constituents, and also creating proactive measures such as a new £600 million investment fund to stimulate housing growth. However, these improvements are not only attributed to restructuring, but instead are as a result of wider structural changes within the council, including a restructure of senior officers. This demonstrates that simply changing to a unitary model will often not be enough in itself. A council looking to restructure has to be committed to a wider scheme of transformation.
  • Wokingham Borough Council: despite being the lowest funded unitary authority in England, Wokingham is managing its budget effectively and maintaining a balanced budget.
  • Unitary authorities generally: often reports into the financial benefits of a unitary authority are speculative and made prior to the formation of the authority, meaning it is often hard to find actual metrics to measure whether those proposed savings have occurred in reality. However, a recent BBC article named the 11 councils under the most significant financial strain. Less than 20% of them are unitary authorities, despite unitary authorities making up approximately 30% of the total of local authorities. Whilst there are many reasons why a council may be struggling financially, the fact that comparatively fewer unitary authorities made the list gives some empirical support to the idea that converting to a unitary model may reduce financial strain.

Warning signs

However, becoming a unitary is not a panacea to all financial or organisational problems. From our research it became apparent that there are a number of unitaries concerned about balancing the books at the end of this financial year. In addition, some unitaries feel that they are now in a weaker position having moved away from a county structure.

Interestingly, one district council currently involved in the early stages of a move to a unitary system has struggled to recruit since the plans became public. Clearly, a move to a unitary does bring with it the requirement to evaluate job structures and duplication of roles which would make people wary of joining a council just before that process began.

Finally, the costs of undertaking the move to a unitary authority should not be ignored, although the long term business model should show those costs being recouped by longer term savings. For example, a recent article has put the ‘transformation costs’ of a new unitary council in Dorset at approximately £27 million.

If you have any further queries about local government re-organisation generally, or you are interested in exploring potential re-organisation routes in your local government area, we would love to talk to you. Please contact our specialist public sector team.

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