Introduction

1.1     The Consultation Institute‟s Briefing Paper 22, published in July 2010, set out some of the key public engagement and consultation issues that local authorities need to consider when facing difficult budget decisions at a time of severe cuts.

1.2     Briefing Paper 22 was originally entitled, Local Public Services Budget Consultation. One of the revisions to this updated version is the focus on local authority budget consultations. However, it is important to note that the principles and issues covered in this revised version can be applied to local public services.

1.3     Last year‟s round of budget setting was certainly harder than ever. As resources were squeezed the pressure on local agencies was greater – community activists and lobbying groups were out to protect their own areas. Timescales were also particularly squeezed. The process of consultation was harder than ever too, with a greater need to ensure that consultees fully understood the complex wider implications of the trade- offs and decisions that were being made.

1.4     Briefing Paper 22 reviewed the history of Budget and Council Tax Consultation and considered what learning needed to be applied to the new circumstances now being faced. It also explored the many pitfalls faced by local authorities as they do their best to balance the views that they hear vociferously voiced in their communities, as the cuts begin to bite.

1.5     On 25th August 2011 The Consultation Institute held a round table briefing about next year‟s budget consultation challenges. A large number of local authorities were represented at the event and the discussion highlighted a number of specific concerns that were common around the country.

1.6     One of the speakers at this event was Peter Headland of Luton Borough Council. Peter had recently completed a research study examining last year‟s practice amongst local authorities with regard to their budget consultation approach. The findings provided a very useful backdrop to the round table discussions.

1.7     This paper draws together the findings from Peter‟s research along with the discussions and presentations from the round table into an updated paper about the Budget Consultation challenge. This recaps some of the content of Briefing Paper 22, whilst building upon it based on the learning from Peter‟s research and the round table discussions.

How do Councils Approach Budget Consultation?

Peter Headland, Member of the  Consultation Institute  and Consultation and Community Engagement Manager at Luton Borough Council, undertook an online survey of local authorities in England as part of his research for a MSc in Social Research Methods. The Consultation Institute supported Peter in this work.

The survey asked Councils to describe and explain how they had undertaken budget consultation work for the 2011/2012 budget cycle. Responses were received from 50 Councils and the findings provide an indication of the range of activities that Councils undertook to engage their communities in these important and difficult budget decisions.

2.1    About the Survey

The response from 50 local authorities represented a 14% response rate. The response was clearly not large enough to carry out any statistical analysis, and caution should be expressed when using percentages. The sample cannot be claimed to be robustly representative of all councils. However, the data does provide a good feel for the issues. A good spread of authorities responded to the survey (20 districts, 12 unitaries, 8 county councils, 6 metropolitan boroughs and 4 London boroughs). The survey invitation was sent out on The Consultation Institute‟s letterhead and 36% of respondents were members of the Consultation Institute. The Institute‟s branding could have led to a bias in authorities more committed to consultation being more likely to complete the survey, but this does not appear to have been the case, since this proportion of members vs. non-members appears to be broadly  in  line  with  the  overall  level  of  local  authority  membership  of  the Institute.

2.2    Overview

There is no doubt that last year was one of the most challenging for Councils in setting their budget. The survey showed that 96% had found the 2011/12 budget challenge very or fairly difficult.

Overall,  90%  of  respondents  stated  that  their  Council  had  carried  out consultation with citizens about the 2011/12 budget, whilst 10% had not. It is not  possible  to  say  whether  this  would  have  been  reflected  country-wide, however it is clear that for many councils, consultation on their annual budget has  become an  important part of the  budget setting process. The  level of Councillor influence on the process appears to have been high – overall, 61% stated that Councillors had a very or fairly high influence on the overall process undertaken.

2.3    Methods Used

The top 5 most common methods used for budget consultation were: Online survey (77%)
Citizens Panel (52%)
Public meetings (39%) Written submissions (36%) Discussion groups (35%)

A very wide range of methods were applied by the 50 respondents, as can be seen in Figure 1.

Figure 1 – Methods used for Budget Consultation

The 5 methods which were seen as most useful by respondents were

Online survey (44%) Citizens Panel (31%) Deliberative event (22%) Public meetings (19%) Written submissions (19%)

An online budget calculator was used by 21% of LA‟s and 17% said it was the most useful method. However, the type of activity used and highlighted as most useful, by the largest number of Councils, was deliberative events. Given the complex nature of the consultation it is perhaps not surprising that a deliberative process appears to deliver the most useful feedback.

The vast majority of budget consultation work was carried out in house, without the use of external contractors.

Participatory  budgeting  (PB)  was  carried  out  by  only  one  authority  for mainstream budgets, reflecting the fact that, in the UK, PB remains an activity that is mostly confined to relatively small pots of money.

2.4    Degree of Influence

An important test of success for any consultation is the degree of influence that is achieved. From the responses to this survey, 14% reported that feedback from citizens was very influential, 41% stated that is was influential on a limited number of  areas but these were key issues for their authority. Just over a third (36%), however, acknowledged that the feedback had had only minor influence, whilst 7% admitted that citizen input had had no influence on the final decisions made.

Of those who said feedback was very influential or influential on key issues, seventeen respondents were able to give examples of what form this influence had taken. The main themes from this feedback were

• Protecting citizen priorities
• Alternative proposals being developed
• The feedback validating priorities
• Concerns being expressed about use of volunteers
• A reduced number of library closures
• Lessons learnt for future consultation – in particular asking “if, then scenarios” and getting people to make choices, using methods which involve dialogue and deliberation.

2.5    Timing and resources

Timing of budget consultations is a key consideration and feedback from this survey showed that decisions about when in the budget cycle this work is conducted were fairly evenly split. Exactly half of respondents said they had sought views at an early stage; 59% midway and 14% at the end of the budget cycle (respondents could choose more than one option, reflecting the fact that some Councils consult at more than one stage).

Most consultations (68%) focussed on a single year‟s budget, but 30% expanded the consultation to cover three or more years (one authority consulted about two years). Considering the amounts of money at stake within even small district councils, expenditure on the consultation process itself appears to have been very modest- 41% said they spent less than £1,000 on the process and only 11% spent more than £10,000. However, it appears almost certain that such costs did not include

key elements (for example of marketing & promotion costs) in the overall costs and that in some cases these costs were not calculated in the same way by all respondents.

In addition, the important element of staff costs were accounted for separately, Staff time estimates spent on consultation were varied – 27% stated that staff had spent less than 10 days on the consultation; 44% estimated between 10 and 49 days, 14% indicated between 50 and 99 days and 7% calculated the effort as more than 100 days.

2.6    Lessons learnt for future consultation

Clearly, budget consultation presents many challenges and it is encouraging that 80% of respondents said that lessons were learnt from the 2011/12 process. The top 5 themes from the detailed feedback about the nature of these lessons were, in order of frequency, as follows:

• Use more deliberative methods and methods which involve a dialogue
• Carry out the exercise at an early stage of the process
• Be clearer about councillor involvement/ objectives and political sensitivity which may limit scope for consultation
• Have a clearer sense of purpose and objectives, and clearer questions
• Use different methods and “triangulate data”
• From the Institute‟s point of view it is gratifying to see that these learning points
• cover much of the ground highlighted as the important points to consider in
• development of a budget consultation process, in last year‟s paper.

2.7    Proposals for future consultation

Whilst some councils had yet to make a decision about whether to repeat the budget consultation process, of those who had decided 71% had decided to carry out future consultation, 26% were already doing so and only 3% had decided not to consult.

This year‟s methods show a similar range with the top 5 most common methods being similar to those used last year, with the exception that it appears there will be a large increase in the use of social media:

Online survey (70%) Citizens Panel (56%) Discussion groups (52%) Social media (48%)

Jointly public meetings, neighbourhood forums, and discussion groups (all 41%)

A further change appears to be that the resources for future consultation on budgets will be even more stretched. Staffing resources were reported as being less in 46% of authorities, remaining the same in 40%, and increasing in only 14%. Revenue resources were decreasing in 37%, remaining the same in 47% of authorities, and increasing in 12%. Whilst respondents were overall positive about the implications of resource changes for future consultation, it seems likely that designing an inclusive and effective consultation can only be made more difficult where resources are reducing.

Key Challenges

3.1    Main Challenges

Last year’s paper outlined a number of challenges that tend to be faced when designing and undertaking a budget consultation exercise. These included, in summary:

Cultural / political context

Budget decisions, for many councillors, are and should remain the sole domain of representative democracy. This view does not always arise from a general aversion to the idea of consultation. Rather, it is a widely held view that in a budget decision making process, those consulted are likely to offer only self-interested perspectives. The culture has to be right for a truly meaningful consultation to be undertaken. Where there is no genuine political will to listen, consultation will be worthless and, in actual fact, damaging to any future attempts at engagement.

Complexity

A major barrier to consulting the public and stakeholders regarding budget decisions is that the decisions themselves are so complex.

There are two aspects to this at the local level:

Structural Complexity – Most members of the public do not fully understand local governance structures. The different tax raising and service responsibilities of councils in multi-tier areas are certainly not well understood.

Financial Complexity – Equally, the complexities of local public sector budgets are considerable. Local authorities are constrained in many ways about the choices they may make – some elements of the budget may be set in stone before the consultation even begins because of legal obligations or historical commitments.

Difficulties framing the consultation –There may – before the consultation process can begin – be a number of firm commitments and pre-agreed priorities that the consulting organisation has little option but to support. What makes consultation problematic is that the public (and stakeholder organisations) will not always be altogether clear about what has and has not been determined. One is then faced with the dilemma of opening up the debate widely – in the knowledge that substantial elements of the consultation will be superfluous, or trying to narrow it down by pointing out what is and what is not open for discussion.

Timing –Timing presents some real challenges and is very commonly a problem for consultations. The essence of the problem for local budget consultations is that to consult early in the budget cycle gives people a greater chance to influence the broad priorities; but much less firm information about the resources that are going to be available. Whilst if consultation is delayed, the scope for any influence is less.

Representation / inclusivity –      Always a challenge for consultors, it is reasonable to assume that local organisations announcing their intention to consult on their budget decisions at a time of such

financial pressure, may find themselves overwhelmed with those wishing to lobby to protect the services they care most about. Getting beyond these activists‟ opinions, whilst at the same time ensuring that their voices are included in the mix, will clearly be challenging. The role of expert stakeholders and partners will also be important. Indeed the far reaching and broad implications of a budget consultation exercise really do mean that the full spectrum of interests within the local community needs to be given access to the process.

Balancing and Weighing the Responses – The need for such broad inclusivity creates a further challenge – if such a wide range of views are to be canvassed, how can the full range of potentially opposing views be weighed and considered in order for any final decisions to be made in a balanced manner?

3.2 Additional Concerns

In addition to these challenges attendees at the recent round-table discussion highlighted the following key issues:

Keeping the story going – making people understand the year-by- year steps, and turning budget engagement and consultation into a longer term process that builds levels of engagement and budget literacy over time. It was agreed that this was desirable and constituted best practice. However, embedding a consistent and cyclical consultation process into the annual budget process was a significant challenge; especially with so many changes taking place within Council structures and staffing.

The depth of the cuts – the current budget challenges for many authorities lead to such a large scale of necessary cuts that the need for complex service reconfigurations will be more important. This, in turn, is much more challenging to consult upon, as opposed to smaller scale budget reductions which may be more easily spread as a small percentage reduction across the board.

Consulting on universal services vs. specialist services – knowing what services to cut is always a challenge, but facilitating this decision being made by the general public is a greater challenge. It is especially challenging to make the majority understand the value of services used by small minorities of citizens.

Making the consultation meaningful – this was a broad and recurring challenge and constituted a number of separate elements, including:

• Internal challenges: making the process as meaningful as possible throughout the council and ensuring the consultation results are acknowledged and considered by all service strands. Involving elected members and engaging them meaningfully was also a key challenge and whilst it might be assumed that Members would be able to fully engage with complex budget dilemmas, the reality is that beyond the inner circle of Members, many Councillors find budget issues difficult to grapple with.
• External challenges: making sure the public feel that their views are being meaningfully considered and making sure that all groups get an equal opportunity to have a say, were challenges repeatedly raised and discussed during the round table session.

Elections – presented an additional headache for those in a local election year. Getting big decisions made during an election year is always challenging and for those authorities that have an election every year the budget consultation process always has to try to get over this additional hurdle.

Legal Challenges – were raised as a possible concern if robust consultation on service reductions is not achieved. Those present at the round tables expressed concern over whether it was important still to carry out Equalities Impact Assessments or not, in order to try to avoid a legal challenge.

Skills deficits– with staff reductions in many consultation and research teams, having the right tools and skilled staff to carry out a robust consultation process was an increasing concern for many authorities.

Being joined up – with pressures on budgets right across the public sector and with potential savings being available through shared services, one of the major challenges emerging for budget consultation is joining up on consultation where budgets begin to, or could begin to, cross over or merge.

Social media– making more use of social media in the budget consultation context was a key challenge for many. It was clear from the discussions (as well as form the survey results) that many local authorities wished to maximise and broaden the use of social media for public engagement. How best to do this on an issue as complex as budget decisions, was a conundrum that many were struggling with.

Getting it right.

4.1    Core Principles

Given all of these challenges, it could be argued that budget consultation exercises even at the best of times are amongst the most challenging to get right. How much more difficult might they be when there continues to be so much pressure on public finances and so much more scrutiny and concern about the final budget outcomes? The Consultation Institute strongly suggests that all local organisations think very carefully before planning a budget consultation and sit down first to agree: What exactly can the public and stakeholders influence? If there is no clear answer or the answer is „nothing‟, whilst we might question why this is the case, we would strongly suggest that no consultation at all is better than a process that lacks genuine influence.

Having said this, The Consultation Institute believes strongly that every good local authority will seek to undertake some level of public and stakeholder engagement on its budget this year and every year. For authorities who are new to this they may wish to start with something small scale or very general, but they should be building on this over time in order to develop trust with their stakeholders, developing a cyclical and ever more inclusive and influential process. The Institute believes that initially it is better to do a few things well and genuinely give people a say, than to promise more and fail to deliver. All of the polling data is clear – many people expect to have a say1. It is not impossible to consult people on budgets, it is simply challenging.

4.2    Rules of Engagement

There is no absolute blueprint to this and much will depend on the circumstances for each organisation, but last year‟s paper highlighted some basic rules of engagement for a process of this kind, these are replayed in summary below:

Adhere to the Consultation Charter2 Principles –Authorities that can adhere to The Consultation Institute‟s Charter in developing, delivering and analysing the results from their consultation will have done much to ensure its ultimate success.

1 Polling data suggests that 11% of the public would like to be actively involved, a further 29% would like a say in decisions, and a further 36% would like to receive information (Base: 1,000 GB adults, 18+. June 2010. Source: Ipsos MORI).
2 A full version of the Charter can be downloaded from: www.consultationinstitute.org

Clarify objectives and scope – One of the most difficult aspects of this kind of consultation will be in defining exactly which aspects of the budget are within the scope of the consultation. There are essentially two possible approaches:

• To consult on broad priorities and to use the feedback received as a guide to more detailed budget decisions.
• To consult at a more detailed level where there is dilemma over actual lines of expenditure.
• Pursuing one approach does not necessarily preclude pursuing the other and in fact there is a strong argument for undertaking consultation on both over a number of phases.

Map the target audiences and reach out – Audiences of interest when it comes to local public service budgets are numerous and diverse. The important element here will be to map out the full range of stakeholders and key players within the locality as comprehensively as possible. Users and advocates, partners, staff and citizens will all require different customised approaches.

Build an on-going dialogue process – A single year‟s budget consultation cannot stand as an isolated exercise. Even once an annual budget has been finalised, there will be many further knock on issues to deal with and engaging communities and stakeholders in these issues will be vital. The challenges of the coming years will demand that local authorities and their partners build on-going dialogue mechanisms which aid a continuous collaborative approach.

Cover a range of methods – and include deliberation – Given the range of stakeholders likely to be interested in a consultation of this nature, it will clearly not be appropriate to take a “one size fits all” approach to the process. A range of approaches to meet the needs of varied audiences should be used. Any meaningful engagement around complex budget decisions must incorporate genuine deliberation within at least some parts of the exercise.

Give feedback – There is one other absolute requirement that the consultor must fulfil the deliver of timely and honest feedback.

Independent oversight of the process – One of the easiest ways to cast doubt on the validity of difficult decisions will be to criticise the credibility of the consultation exercise undertaken. Local agencies may well benefit from some external and independent input and over-sight of their consultation approach, as a way of ensuring that their processes are beyond reproach.

4.3    Key Additional Tips from the Round Table

To conclude the round table session, the floor was opened up for a plenary discussion on issues surrounding communications, engagement and budget consultations. A number of tips and suggestions arose from this session which might be useful for authorities to consider in addition to the basic principles outlined in last year‟s paper:

• Authorities and their partners need to make much more use of their frontline staff – they are one of the most valuable resources available and are often overlooked. This means not only that frontline staff should be consulted regarding possible areas for saving resources, but that front line staff can be a useful conduit for consulting the wider public. Some authorities had built structured staff consultation into their budget consultation process and had found it an extremely useful element of the process.
• When communicating with the public it is often better to use terms such as „local priorities‟ or „decisions on services in your area‟ and thereby avoid framing the consultation as being solely about ‘budgets’ or „finance‟. The public can be put off from participating in consultation because they fear that consultation on budgets or finance will be dry and incomprehensible. By framing the consultation in terms which they feel are relevant to them and on which they will have an opinion, more people are likely to be willing to take part.
• As with all consultation using the right language is vital. The public do not use terms such as „regeneration‟ or „community safety‟ so asking them to prioritise between these is likely to be meaningless.
• Consultation materials should make references to financial information in relative terms rather than just figures at a headline level. Saying that a service costs £6.2 million to deliver means very little to most citizens. However, with some thought these figures can be made accessible through illustration of their meaning at a lower level, for example – £x = 3 teachers or social workers.

Reach out and do not expect the public to come to you. One example was given of a Council using an empty shop in a town centre to invite people in to engage in the budget consultation.

Use existing forums – there is no need to create new systems or processes. The most effective consultations will make use of the wide range of existing forums (offline and online) in an area. These will not all necessarily be forums set up and run by the local authority – engaging through partners and the community and voluntary sector will also be vital.

Biographies:

Rachel Lopata has 20 years of varied experience in market and social research. She has extensive quantitative and qualitative research experience having worked at Director level for two major market research agencies, ORC International and Opinion Leader Research, before setting up her own consultancy, Community Research. She also worked for six years in a local government policy and research role.

Whilst broadly experienced in a range of research approaches, Rachel‟s particular area of expertise is deliberative events. She has developed, designed managed and facilitated some of the most high profile deliberative research and consultation exercises ever seen in the UK including the National Pensions Debate, The Prince of Wales’ Business Summit on Climate Change and Sky‟s „The Bigger Conversation‟.

Her recent clients include a number of local authorities and health trusts as well as Arts Council England. She recently helped Leicestershire County Council to develop their approach to participatory budgeting, in which she also takes a keen interest.

Peter Headland is the Consultation and Community Engagement Manager for Luton Borough Council. He has 20 years of experience of working with residents to improve services and communities. This has mainly been in housing organisations in London but more recently in a corporate setting at Luton. Peter led on the budget consultation with residents in Luton last year. He has provided project leadership for a community involvement strategy which seeks to deliver a joined up approach by partners in Luton.

Peter is currently carrying out research on how local authorities are involving citizens in the budget challenge as part of an MSc in Social Research Methods with the Open University.  This involves a survey, in-depth interviews and discussion groups.

Davy Jones has worked for public services for over 20 years. Since 2007 he has been freelance, specialising in public engagement, participatory budgeting, Local Strategic Partnerships, partnership working and performance management. He is also a recognised national commentator on the developing policy context for local public services.

Prior to this, Davy worked for over eight years for the Audit Commission on several key areas including national performance indicators for local authorities, leading on the widely acclaimed Area Profiles project, and most recently leading the Commission’s work on citizen involvement and reporting for CAA. He previously worked for over 11 years in three London councils in corporate and housing policy.

Davy is an Associate of the Consultation Institute and has delivered a number of key courses for the Consultation Institute, including Comprehensive Engagement Strategies, New Approaches to Public Engagement and Implementing the Duty to Involve. He is also an Associate of the national Participatory Budgeting Unit.

This is the 29^th Briefing Paper; a full list of subjects covered is available for Institute members and is a valuable resource covering so many aspects of consultation and engagement