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Growth not cuts is the recipe for stronger communities

13th August 2015

They say that attack is the best form of defence and in a local government context, colleagues up and down the country will have felt on the defensive for quite a while now.

The problem however is that this often forces us to look internally rather than externally for solutions, and for those who are working their way through restructure mk. III or even IV, there are few places left to find those elusive efficiencies without compromising service outcomes.

As service heads will know, a well-resourced regulatory directorate will, or at least should, be acting as a crucial economic enabler helping businesses reduce ‘waste’, mitigate risk and manage things efficiently when things go wrong. The challenge in 2015 however is that such interventions are not cheap and when faced with the prioritisation dilemma of reactive or proactive activities it is often this kind of crucial support that ends up getting slashed.

Primary Authority

Recovering costs through primary authority is a useful part of the answer but our regulatory partnerships with councils, such as Barnet, have gone much further. They have put commercial growth at the heart of the model. This is not just about maximising revenue but about sustaining outcomes; whether a business can access reliable support and assistance at a time that suits them should be something that is on offer to all the economy - not just part of it.

Charging for some services that were once delivered without a fee should not be so much considered a dilemma for councils, but must now be regarded as de rigueur. The mantra for sustainability of services going forward therefore should be growth not cuts.

Capita’s nationwide market research tells us that businesses will pay for services if it adds value, so the key is to move away from traditional forms of delivery and create more business centric services – whether they come with a fee or not is less important.

Growth Programme

Our growth programme for our partnerships, which are delivering services to local authorities, citizens and businesses alike, is forecast to realise substantial income over the next ten years in growth activity. Such revenue will not just mitigate against future budget pressures, but it improves the council’s overall proposition allowing businesses and citizens to get access to the services they need and allow vital reinvestment in priority non-fee earning activity that protects vulnerable adults or closes the health inequality gap.

The challenge of implementing a growth programme into a local authority environment however should not be underestimated, and the very notion of  public services making ‘profits’ will not be embraced by all - it requires a fundamental reengineering of culture, processes and leadership.  Such change takes time and significant investment to create the capacity to implement it, but the results mean those councils who are on the front foot are the ones that will be resilient against future rounds of austerity.

 

Andy Foster is director of regulatory services in Capita’s property & infrastructure business.

This article first appeared in EHN magazine.

 

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