Proposition 5: Local government can drive local economic growth

Proposition facilitator: Catherine Howe, Chief Executive, Public-i

With the removal of Regional Development Agencies in England along with associated funding streams, local authorities are looking for new partners to drive growth in their communities. Local authorities across the UK are working focusing on the wider drivers of growth, such as technology, transport, housing and planning in order to create attractive places with the right connectivity, environment, infrastructure and skills and that can compete in the global economy.

This discussion will focus on the role of the modern local authority in driving growth and create a framework for action at local and national levels.

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2 Responses to Proposition 5: Local government can drive local economic growth

  1. Pingback: Welcome to the Solace Summit 2011 | Solace Summit 2011

  2. Robert Hardy says:

    Most of what’s contained in the Open Public Services White Paper will come as no surprise to anyone who’s being paying attention to the Coalition Government’s agenda since it took office. Much of what’s in it reflects an extension of the approaches that innovative and open-minded councils have been taking for a long time.

    What’s new is that all this comes as year one of the public spending cuts starts to really bite. Outsourcing is therefore seen by some in government as the panacea to cure all spending ills. The reassurance that this is not simply a ‘dash to the bottom’ in terms of price and quality is supposed to come with the encouragement of social enterprises, mutuals and other Big Society archetypes. This could well be the case over time but any kind of entrepreneur (including the social type) needs time to establish the sort of track record that could support the running of public services.

    In the past there may have been time and resources in the public sector to support the development of this market place – look back at the development of the private and voluntary social care sector. Even after all this time that market is hardly a model of robust private sector enterprise. In current circumstances the option of investing in developing the market/supply chain is barely feasible – there isn’t the money to support such an approach and the front-loading of the spending cuts means there isn’t the time either.

    Of course outsourcing can and does work. Are there options open to local authorities other than a ‘big is beautiful’ approach to finding the cashable savings they need from outsourcing?
    I think there are but I think these require some ‘joined-up thinking’ that may not be being done between those responsible for commissioning and procurement spend and the council’s policy commitments to grow or strengthen the local economy.

    I am convinced that local councils can reduce budgets AND continue to support local jobs and local businesses. If supplier and service delivery diversification are the way of the future, councils can still balance the need for reduced costs with retaining local jobs and prosperity.

    The key to this lies in re-inventing and re-invigorating the relationship between the council and the local small and micro-businesses that make up the bulk of their local economy. These businesses can be the cornerstone of an economic localism that delivers the savings in public spending we all need and at the same time strengthens the role that councils play in their local economy.
    Some key questions need to be addressed before this approach can work. They include –
    • Are local businesses ready to compete, or will more and more of this work go to a small number of ‘big players’?
    • Does the recent example of Southern Cross give councils reasons to be concerned about being too reliant on a small number of big suppliers?
    • If small businesses themselves aren’t competitive with these ‘big players’ are they willing to collaborate with other local companies to form effective consortia
    • Can councils apply the lessons from their own innovation in supporting local supply chains for big capital projects to the supply chains they need to deliver public services?

    Is this worth debating at the summit?

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