Christopher, Of Honour and House Paradiso are all very notable things to put before or after the word ‘guest’, but none comes close to making us as happy as being able to put the word Post after it. Today we have the chance to do just that with this excellent guest post from Rob Jackson, which takes a look at just one of the many claims made about how local government could keep doing more than it already is. Share your thoughts with us on Twitter, but not before having a good read…
Local government is ‘blessed’ to have many wise people orbiting around the sector who write lengthy, eloquent and solemn reports, describing bright ideas which will *absolutely* reduce costs by billions of pounds across all councils. I’ve always been sceptical of the numbers bandied about by some of these reports, and a recent example appeared on my Twitter feed while I had the time to dig a little deeper…
FutureGov recently wrote a blog discussing a report by Policy Exchange (PX), and they introduced it thusly : ““Local authorities could save up to £10billion by 2020 through smarter and more collaborative use of technology and data.” Quite the eye catching headline from a new Policy Exchange.” PX have used this figure of £10bn as click bait for their report, and it’s interesting that many organisations have repeated it. The PX report runs through a list of ideas which could contribute to £10bn of savings and I’m going to use this blog to explore three with the largest indicative savings to quickly demonstrate that this number could politely be considered optimistic:
- Developing more shared capabilities…could save £1 billion over five years.
This could be achieved because the “NHS online recruitment service…has already generated savings of over £1 billion since its launch in 2003”. This stat came from a book, but it seemed large when compared to the other figures in the public domain (£240m is mentioned here and here; £5m savings over the first 2-3 years are mentioned here: and the original aspiration was for £24m over five years). So I asked the author via twitter for more information and I was directed to a detailed case study produced by the organisation who delivered the website. The £1bn was mainly calculated from eliminating advertising costs using the following sums: A study found it costs, on average, £800 to advertise for a teacher . There are 200,000 jobs advertised for free on jobs.nhs.uk every year; if all of these jobs had similar advertising costs to teachers the total saving would be £160 million per year. So in twelve years since launch they conservatively estimate the savings would be a billion quid . In summary: the £1bn figure is taken from the costs of recruiting teachers, applied over 12 years to jobs.nhs.uk; and then onto local government for achievement in five years. Anyway, regardless of where the numbers come from (and how appropriate it is to apply them), a free local government jobsite already exists.
- Expanding shared services could plausibly increase savings to more than £500 million each year.
The PX report makes the unarguable point that shared services could generate more savings with better data sharing and more co-procuring of the right technology. The £500m figure looks to be an extension of the LGA data on shared services saving (£165m in 2012, £278m in 2013 and £357m in 2014). However,PX quote the LGA report stating that “two thirds of councils believe that efficiencies will be running out by 2015/16.” Can it be safely assumed that the total savings generated will increase further as a result of improved processes?
- Putting in place data-sharing arrangements to make a success of Whole Place Community Budgets across the country could save the public sector between £9.4 billion and £20.6 billion over 5 years
This enormous savings figure was calculated and published within a report produced by Ernst and Young. They came to this figure by assessing the business cases of the four pilot areas and not the actual outcomes of the projects. They aggregated up the predicated savings and projected them onto a national scale . But as a National Audit Office report states the “true scale of potential benefits will become clear only if projects are implemented and evaluated robustly”. So why are people still using the figures in the 2013 EY report? Probably because the DLCG end of pilot review, focused on the processes to successfully develop a community budget, rather than detailing any actual savings and no further reviews have taken place with the political focus quickly moving onto pooling/integrating budgets via City Deals and the Better Care Fund .
Finally, and this is a point not specifically about PE or the author of the report but we need to be aware that think tanks, despite proclamations of independence, often have political leanings which will be reflected in their policy campaigns . This doesn’t mean the opinions/views/ reports should be dismissed without consideration but we need to recognise and understand where the report is coming from as part of the discussion. PX has longstanding links to the Conservative Party: PXs own websitewas happy to report that in 2014 The Times described them as “David Cameron’s favourite think tank”.
This small example is indicative of a wider issue: local government is being bombarded with suggestions on how to remodel our services but we can’t allow policy ideas to emerge without thoroughly exploring the evidence base. Initiatives like the What Works Network will help by giving people access to systematic reviews of policy initiatives so we can use this to inform strategic and service planning. Perhaps there is also a need for a local government equivalent of the brilliant NHS Beyond the Headlines so we can really cut through the hype and challenge policy ideas at source.
Rob Jackson is on the Twitter.
1. I want to emphasise that I am a huge admirer of FutureGov, they are genuine innovators in the public sector who are passionate about improving services
3. The full quote: “Savings of well over £1bn thus far have been generated” My emphasis. I find the unequivocal language a bit odd – there are lots of reasons why this might not be the case, just a few are:
· We are not comparing cost of advertising before and afterwards
· The dynamic of the teacher labour market will differ from many of the professions within the NHS
· The cost of advertising will vary through time
· NHS jobs (especially senior roles) continue to be advertised on other websites.
4. They did accompany it with a helpful (if largely ignored) warning: “It should also be noted that net financial benefits do not necessarily translate into budget savings and there is a lot of work to do before this potential can be realised on a national scale.”
5. This clearly illustrates the inherent flaws of government pilot schemes that Ben Goldacre has criticised