Localis study backs up case for place-based budgeting

Author: David Williams, Public Finance   |  

A study of public sector organisations in Birmingham has found that services can be improved and costs cut through a combination of early intervention and place-based budgeting.

The report, published today by the Localis think tank, is the latest in a string of studies to advocate cross-agency, Total Place-style local budgets, which are widely expected to feature in this month’s Comprehensive Spending Review.

On October 1, a Local Government Association paper set out more than œ20bn of savings that could be made by devolving spending powers to councils and joining up public spending at a local level.

The Localis report outlines a ‘total neighbourhood’ approach, in which separate government funding streams are connected up and used to fund community-based programmes that save public money in the long run.

Examples in Birmingham include a project working with individuals with drinking problems, which has led to a drop in alcohol based anti-social behaviour of 54%.

The report, which has been backed by Total Place architect Lord Bichard, also found that œ2m spent on children aged under 10 with behavioural problems could save œ97.3m over 15 years.

Author Barry Maginn, said place-based spending must be at the heart of the government’s approach as it puts its Big Society thinking into action. He said: ‘Achieving these goals will require a radical change in the state, and in mindset.

‘But in the current climate, is there any other option but to be radical?’

The LGA study found that integrating health and social care budgets could save œ6bn a year, while other forms of joined-up working could yield a further œ5bn.

De-regulating local government could lead to savings worth œ4.5bn a year, while a further œ3bn could be saved on benefits bills through targeted local action on those not in employment, education or training, or who are unable to work.

Around another œ1.5bn could be found through various smaller reforms such as devolving tasks currently undertaken by quangos, changes to bus subsidies, and cutting out duplication in offender rehabilitation.

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