Why southern comfort requires R&R
Originally published in the Municipal Journal [04/12/24]
Restoring strategic capacity for long-term resilience will be vital to twin pillars of public service transformation and nuanced devolution in the country’s most populous region, argues Jonathan Werran.
At the time of writing, we’re living in one of those times for local government when, to paraphrase Lenin, more is happening in weeks than often happens in decades. It’s another case of everything, everywhere and all at once when it comes to the resourcing and the role of the local state. Last week gave us the local government finance settlement which is important in its own right but also a precursor to further shaping of local authority financial governance in the imminent (wait for it!) devolution white paper and the restoration of multi-year settlements in next spring’s Comprehensive Spending Review.
In preparation, and over the course of this summer, Localis has been returning to investigate the political economy of the South East in our first check up since we reviewed the region’s role to the Levelling Up agenda (remember that?) as a net contributing area of vital national strategic significance whose surface prosperity masked areas of acutest deprivation.
Now we are firmly in the arena of mission-led government, ahead of a reset and restatement of national purpose tomorrow, our latest report “Restoration and Resilience: building capacity and capability to deliver local services in the South East” underlines the fact the region remains a vital economic engine for the UK. However, this vital dynamism is undermined by the fact its local government system is under severe strain.
And the impact of strain to councils serving the 9.2 million people living in the country’s most populous region is a discernible worrying decline in their capacity to deliver vital local services. This is true of councils everywhere, but what makes the issue here so much more serious is the cost-of-living premium in the south east and the consequential a looming capacity crisis from the inability to recruit and retain professional and skilled staff.
So, from a perspective of fixing the foundations and playing its part in responding to the local, regional and national, our study for South East Councils and South East Employers urges that councils across the region must swiftly gain powers over local public sector recruitment policies and to set more competitive pay scales to attract and retain talent. We further argue they would benefit from devolved control of immigration policy for key roles like care workers and in green skills to address acute workforce shortages made worse since Brexit.
As with much of our recent analysis into the role and function of the local state, the seeming and mystifying decoupling of foundational frontline services from strategic placemaking as if they weren’t so profoundly interdependent unities.
And ahead of the devolution white paper landing, it’s fair comment to say that for the south east fragmented governance is an obstacle to effective collaboration and strategic planning.
To address these challenges, our new report recommends a series of measures, including:
- strengthening financial governance and strategic leadership
- diversifying revenue streams
- investing in workforce development and capacity building
- promoting collaboration and partnership working
- reforming the funding system
- empowering local authorities through devolution.
When it comes to the big ‘D’ word, we are advocating for a devolution settlement that is tailored governance in the south east that plays to economic strengths.
The South East’s economic vibrancy demands a bespoke devolution framework that grants local authorities greater fiscal autonomy and control over key policy areas. By leveraging powers such as localised taxation, housing and transport planning, and skills funding, councils can address regional disparities while enhancing economic resilience.
Tailored pay scales and targeted immigration policies could alleviate acute workforce shortages, while reforms to the apprenticeship levy would enable councils to design locally relevant training programmes. In this sense, devolution must prioritise fiscal sustainability through innovative revenue-generation mechanisms, such as tourism taxes, reducing dependence on volatile central grants.
A strategic focus on housing affordability, infrastructure development, and covering social care gaps would allow the region to harness its strengths while addressing pressing challenges. This approach, combined with an openness to enhanced collaboration positions the South East as a model for regionally nuanced governance.
How we get to nuanced devolution will require local public service reform that incentivises cross boundary collaboration and regional cohesion. The fragmented political and economic landscape necessitates a robust framework of multi-tier, cross-boundary partnerships.
Local authorities must break down longstanding silos to develop integrated service models and cohesive regional strategies in areas like housing, social care, and transport. Collaborative governance, supported by shared resource pools and standardised workforce initiatives, can mitigate financial pressures and address staffing shortages. Strategic alliances with third-sector organisations, educational institutions, and other councils are instrumental in driving efficiency and innovation. By fostering consortia to negotiate with external providers and centralising workforce training, councils can reduce reliance on temporary staff and build a resilient, permanent workforce.
But the foundation on which these twin pillars of devolution and public service reform will rest on will be one of a capable and dynamic local government workforce. It is here the region must build up strategic capacity building for the sake of long-term resilience by overhauling and improving succession planning and workforce development.
Jonathan Werran is chief executive, Localis