Unaffordable regulation must change

Author: Local Government Chronicle - Sep 16, 2009

We are in a period of transition from all-encompassing external audit and inspection to a new model. We can’t tell yet what will come next but clearly much of the present settlement will be facing heavy scrutiny as a costly overhead.

The National Audit Office, Whitehall performance management teams and the Government Offices, coupled with myriad regulation and inspection bodies such as the Audit Commission and the Tenant Services Authority, employ many thousands of staff. In aggregate so too do local authorities, feeding the beast of regulation.

But does the measurement and assessment of our services and organisations still add value and who is best placed to carry out such a role?

Some services to vulnerable clients, such as children and older people, require independent validation. But there is no evidence that inspectorates have made clients any safer as their scale and reporting requirements have burgeoned. Front-line staff privately say the reverse.

In coming years, therefore, bodies such as Ofsted and the Care Quality Commission must demonstrate that tax pounds diverted from the front line add value. Service problems are not simply best solved by more inspection; but targeted and streamlined advice can have a role.

But what else, if anything, is needed beyond the inspection of some specific services? Given the need for better outcomes with fewer resources, local authorities and their partners need to change their pattern of expenditure. Rather than spending in traditional service silos, we are aiming to deliver preventive and innovative solutions by prioritising public resources.

We can achieve this through improved intelligence and cost-benefit evaluation. Success will require us to meld such creativity with harder risk management so that bread and butter requirements do not fall over as budgets evaporate.

Collaborate to regulate

Personally, I think this requires much less inspection and much more self-regulation through regional improvement partnerships co-ordinating shared data, systems, tools, peer challenge and support.

There is widespread scepticism that external inspection bodies have the expertise to improve whole organisations, systems or partnerships. We were told that the comprehensive area assessment would mean one streamlined assessment of our overall capability, but in reality as yet there has not been as much change as promised.

The LGC/Liberata Future of Local Government Survey shows that opinions in our sector are divided. About half think there will be less regulation and reporting; half think it may increase. There is a similar split over whether we will see forms of self-regulation and local oversight or if co-ordinated external regulation will continue.

But to what extent are these views reached through resignation to solutions being imposed on our sector rather than an assessment of what’s actually needed?

This will surely change as resources tighten. For example, many authorities think the Use of Resources process this year has been a triumph of process over outcome. Some authorities are now signalling that they will in future decline to submit a self-assessment so that savings can be redirected to the development of the new tools needed.

During the years of plenty it was worth following prescriptive national standards and seeking higher inspection scores to secure government resources. But in a few years the test may instead be whether setting them aside locally will help secure savings.

And our sector will query inspectors when they acquiesce with the sentiment that councils are failing if they decide – when faced by reduced resources and increased pressures – to safeguard outcomes by paying less attention to certain national indicators.

Time to act

But in the vacuum of consensus on an alternative system to improve outcomes, the status quo of inspection and regulation could remain or even grow. This time next year any government will be grappling with seismic fiscal decisions, and so in consequence will local government. Of course the form and function of our organisations may be altered, which could possibly affect sector-led approaches.

But this aside, the time to have such a debate is now, so that we articulate the system that is truly needed and avoid a knee-jerk response to the next specific failure or problem that arises.

Rob Whiteman, Chief executive, Barking & Dagenham LBC

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