Councils finance bosses face Xmas mulling over cash consultation

Merry Christmas everyone.

Except that if you are an officer or an elected member worrying about the ever-worsening finances of local authorities in England, you have precisely 11 working days (exc Bank holidays) to respond to the Ministry of Housing, Communities and Local Government’s consultation on next year’s financial settlement. View this here.

A four-week consultation for something that affects everyone in the country is pretty mean at the best of times, but over Christmas … hmmm? We don’t suppose any Councils relish upsetting their (partial) paymasters to the extent of mounting a legal challenge, but the Gunning Principle Three is about giving consultees enough time to consider the proposals properly. Would Judges consider the timetable for this to be reasonable?

Then there is the question of the target audience. In the convoluted labyrinthine world of local government finance, views are sought on such exotics as the adult social care relative needs formula or the approach to distributing the rural delivery grant to the upper quartile of Councils based on the super-sparsity factor. Maybe it is only intended for mathematical masochists with the kind of brains that want to count the number of baubles hanging on your neighbour’s Christmas tree. But the reality is that many Councils are on their knees, financially and the forthcoming settlement will influence whether and what services can be delivered to local communities. Deep in the proposals is the Government’s threat to force Town and Parish councils to hold referendums if they wish to raise more money through Council precepts unless it sees ‘clear evidence of restraint’ . The squeeze on Councils continues!

The audience for this consultation should include substantial swathes of the voluntary and community sector which is surely affected by restrictions or withdrawal of local community services. Under the National Compact, the Government had originally promised a 12-week consultation period for subjects of direct relevance to the Sector – recognising that its diffuse and widespread nature demanded more time to gather views and generate meaningful responses. To what extent will it be able to participate in the exercise?

But for such a meaningful debate, one needs some idea of what will be the implications of the financial settlement. Turn therefore to the draft Equality Impact Assessment.

Reading this document, one has to question what, if anything these add to the consultation. To paraphrase, maybe a tiny bit unfairly, what it says (at the end of Section 2, paragraph 1) is that “…it is not possible to predict how the changes will impact on specific groups of persons sharing a protected characteristic, as this will be dependent on the decisions made at local level …”

There are two problems with this approach. Firstly, it implies that it is not possible to undertake any research as to the likely behaviour of Councils in consequence of reduced funding for various activities. This would be disputed by at least a dozen academic institutions, the Local Government Associations and a large number of function specialists and think tanks. Secondly, it seems not to have taken account of the potential impact of the Bristol City Council case on funding for Special Education Needs and Disability (SEND) earlier this year.

In that case, the Council sought to argue that whilst it had not produced a sufficiently robust Impact Analysis of the overall spending plan for SEND, it would have fully intended to do so and consult on such impacts at the point where the details of the proposed services were announced. The Court however ruled that where budget reductions were of such a scale that some adverse impacts were inevitable, and irrespective of how the details were eventually configured, there would need to be a proper informed impact assessment at this early stage. At the Institute, the terminology we use is to distinguish between the shape of the budget and the substance. This Court case ruled that where the implications appear to be considerable, you may need to consult at the shape stage.

By analogy, what the Ministry is doing is consulting at the point that influences the shape of a Council’s budget, but, when it comes to figuring out the likely impact of its financial settlement, it is effectively saying that it has no idea – because that will be determined at the substance stage. Were the LGA or some other body to test this principle in Court, who knows who might win. One thing is for certain, though. The existing Impact Assessment (called an Equality statement) tells us very little and is mostly a reiteration of the Government’s own proposals.

Read it. See what you think?

But please don’t divert yourselves from having the Merry Christmas that Finance officers may need to curtail!

About the Author

Rhion Jones is considered a leading authority on Public Engagement and Consultation. A founding Director of the Consultation Institute, he is co-author of “The Art of Consultation” (2009) and “The Politics of Consultation” (2018). He has delivered over 400 training courses and Masterclasses and is a prolific writer on the subject, having written over 300 different Topic papers and over 40 full Briefing Papers for the Institute. Since 2003 over 15,000 person-days of training based on courses he invented have been delivered. Rhion is in demand as an entertaining Keynote Speaker and Special Adviser, particularly on the Law of Consultation, and its implications for Government and other Public Bodies. In 2017, he was awarded the ‘Lifetime Achievement Award’.

Read more about Rhion

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