Effective Services and Value for Money

In this page:

  • One of the key criteria for judging whether to change how we are governed is whether doing so would improve public services.
  • At the same time, most people do not want to pay more taxes. So thinking about efficient provision of services also matters.
  • There are also important questions relating to how the money to pay for local services is raised.

Most people want local councils and other government bodies to provide high quality public services. But most people also don’t want to have to pay too much tax to pay for these services.

That means we are concerned not just about the effectiveness of services, but also about their efficiency: whether they represent good value for money.

Thinking about effective services

Most people care about the quality of public services.

There may be different aspects to that quality. For example, there could be a trade-off between having a small number of large hospitals that can provide high-quality specialist care and a larger number of small hospitals offering more local, generalist care.

Effectiveness can be influenced by many things that the assemblies are unlikely to focus on, such as the quality and number of staff and equipment.

But two features of local governing structures that can influence effectiveness will be particularly important for the discussions in the assemblies:

One of these is the scale on which services are provided:

  • Working across a larger area might promote more effective services – for example, there might be cases where good services rely on experienced experts. If services are provided in a very local area, some issues might come up too rarely for the people responsible for responding to develop relevant experience.
  • But in other cases it might be more important to tailor services to local needs and wishes.

The second feature is the degree to which service provision is unified in one body or spread out across many.

  • There are many cases where outcomes are likely to be better if several services run by different bodies are connected together.
  • That applies, for example, to health and social care, to the various educational, health, and social services that engage with families in trouble, and to the different bodies that can help prevent re-offending.
  • Creating structures where such services are coordinated by a single organisation may therefore be important.
  • That raises big questions for the assemblies. If it would be desirable, for example, to integrate health and social care, would that mean that health and social care should be coordinated by the same organisation? If so, should health move from unelected bodies (as now under the NHS system) to elected bodies, or should social care be transferred away from elected councils (as now) to unelected bodies?

Thinking about efficient services

The concepts of ‘efficiency’ and ‘value for money’ refer to whether inputs are used in a way that maximises outputs. Is a given level of service provided for the lowest possible cost?

Debates about delivering efficient services are complex, and the assemblies will not have time to go into all aspects. But three features of local government structures might have a particular impact.

One is what we have already mentioned: the scale of public services.

  • It is often argued that working in larger units allows services to be delivered for lower cost because back-office functions can be combined. Indeed, some councils have merged certain functions, such as maintaining their websites, in recent years, even when the councils themselves have remained separate.
  • On the other hand, evidence that merging councils leads to substantial savings is actually quite limited – it seems that the savings are generally only around 1%.
  • Indeed, it is also possible that, as organisations get larger, they can become less efficient, as they develop extra layers of management.

The second issue to consider is whether different structures are better or worse at encouraging innovative thinking on how to achieve better value for money.

  • The smaller a council area is, the less diverse it is likely to be. That could make it a stronghold for one of the political parties, such that the same people remain in power for a long time. That can lead to inefficient ways of working and even, in the worst cases, to corruption. Recent research by the Electoral Reform Society suggests that councils dominated by one party tend to be less efficient.
  • On the other hand, if councils are smaller, that means there are more of them, so there are more opportunities for innovative ways of working to be tried. If new ideas are found to work in one place, they might then spread elsewhere.

The third issue is the number of layers of local government and the nature of decision-making processes:

  • Adding extra layers of government is likely to increase costs. The differences will often be small. But, in an age of austerity, they might still cause concerns.
  • As we mentioned in our page on ideas about decentralisation to local neighbourhoods, some forms of decision-making may be more expensive than others. Holding local assemblies, for example, costs money: dates have to be advertised, venues have to be hired and heated, staff need to be on hand to present options and listen to the views that are expressed, records have to be kept, and so on. Such events might strengthen democracy, but they do so at a cost. What price democracy?

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