Why we don’t need another reorganisation

Malcolm Prowle says the Welsh Government should not interfere in local service delivery

A feature of central government in the UK (which includes the Welsh Government) is an obsession with strong central control of local government activities. There is no constitutional protection for local government. As a result, it sometimes seems that central government treats local government like a feudal master would treat his slaves forgetting that local councillors are themselves elected. This should come as no surprise to those who can remember the programme Yes Minister where the Permanent Secretary repeatedly urges, “centralise more Minister”.

In Wales this has gone even further with the Welsh Government removing the democratic mandate from elected members in some local authorities by the appointment of Commissioners to run services which it deems to have failed. Of the 22 Welsh local authorities, two (Anglesey and Blaenau Gwent) now have some Commissioner involvement and a third (Pembrokeshire) is subject to a special investigation which may lead to Commissioner involvement. This situation compares with just one English local authority among England’s 152 principal local authorities being run by commissioners. Recently, Professor Tony Travers of the London School of Economics commented (BBC Wales website, 2 Sept) that this situation does suggest a degree of centralisation by a Cardiff based Assembly, which is paradoxical given that devolution was supposed to shift power away from London to Wales.

This abuse of power would not be so bad if it wasn’t also hypocritical. The Welsh Government itself is far from successful in developing and implementing public policies. Poor service standards at the local level can’t just be laid at the feet of local authorities. Welsh Government Ministers arrogantly devise policies, issue orders, create targets, reverse local priorities, interfere, inspect, criticise, insult and punish local government – ignoring the fact that councillors have a local mandate.

The creation of current 22 unitary authorities in Wales in the last reorganisation in 1996 was seen as an error at the time and has left a legacy of concerns around the size of local government units, and a lack of co-terminosity with other public bodies. Moreover, the absorption of the former Welsh Development Agency into the Welsh Government in the mid-2000s produced a lack of clarity about the critically important issue of economic development in Wales.

Fast forward to 2011 and we hit the consequences for Wales of the UK fiscal and public debt crisis. In the light of this, not surprisingly, there has been much debate about where Wales should go with regard to local government. A limited number of options seem to present themselves.

Some are of the opinion that the Welsh Government is pursuing a strategy that will ultimately lead to the abolition of local government in Wales central management of all services from Cardiff. A variation on this theme might be to retain local authorities with a service profile similar to English district councils but transfer the delivery of major strategic services, such as education and social care, to the Welsh Government.

I am not convinced that the Welsh Government has such a strategy for two main reasons. Firstly, the skill base of civil servants lies in policy formulation and they just do not have the ability or experience for the operational management of local government services. Secondly, under such a model, the Welsh Government would be completely accountable for the performance of these services without having local authorities to blame for any failures.

There is considerable support in Wales for mergers of many local authorities to create a smaller number of bigger units that might overcome the alleged problems of small size. The end result could be a reduction of Welsh local authorities to around a dozen.

Although this is an idea dear to the hearts of many politicians, there are some serious problems to be considered. Because of the way such mergers are invariably conducted in the public sector the process tends to be rather long winded, disruptive and immensely expensive. I was involved in the re-organisations of local government in Wales in 1974 and 1996 and can testify to the level of disruption and time commitment that is involved.

If there was now to be a major programme of mergers it is likely that senior local government managers in Wales would ‘take their eye off the ball’ for a couple of years while they jockeyed for position in whatever new structure emerged. All this would be at a time when they need to be focusing on improving services and containing costs. If anybody tells you this won’t happen (especially politicians with limited management experience) don’t believe them. Experience shows it is always the case.

Furthermore, evidence from many parts of the public sector shows that often the merger options developed are, usually for political reasons, completely the wrong ones. No-one should be surprised that they do not produce the benefits intended.

Finally, the killer argument is that what research is available suggests that in practice there is little evidence to link size of local authority with performance. While this may be strange and unexpected, what I have observed is that when larger units are created, a lack of market discipline leads them to introduce much more elaborate and complex management structures. The resultant costs then outweigh any savings that might otherwise be made.

The third option is basically to stick with the existing structure of local government in Wales but to develop networks of consortia or collaborative arrangements involving several local authorities, for the delivery of certain specific services. This would aim to overcome the alleged problems of small size.

This currently seems to be the preferred way ahead in Wales, with various consortia springing to life covering a wide range of services. However, while consortia arrangements might be workable for back-office services like legal or financial services, with front line services great care is needed.

Like so many of these initiatives, there is a lack of thinking around the creation of such consortia. There are several points of concern. For example, what benefits should the consortia generate and how are these to be realised? Wishful thinking won’t do it.

Another issue is what will be the accountability and governance arrangements for such consortia involving several local authorities. All we want is a Baby P case in Wales for serious questions to be asked about accountability and governance arrangements of social care consortia.

Finally, there are situations where a local authority might be involved with several consortia each with a different range of local authority partners. In these circumstances it seems difficult to see how improvements in citizen focus and joined-up services would be achieved.

While there may be merit in such consortia, it is probably better if they grow organically, building on existing relationships rather than being forced from on high. The danger is that local authorities will be forced down a particular route and left with unworkable arrangements for which they will then be blamed.

As a former management consultant, I was always taught that organisational structures should follow the establishment of management processes and cultures, and not lead them. Thus, rather than tinker with structures  in Welsh local government and face having to deal with the consequences, we would be better off focusing on how to make the existing arrangements work better and achieve gains in performance.

However, this is not easy to do and requires significant changes in organisational cultures and management effectiveness in Welsh local authorities. It will not be achieved by Ministerial directives and targets, bureaucratic performance management frameworks, comparisons with England or Commissioners issuing short term action plans. Instead the focus should be on developing organisations where employees are encouraged to look for continuous performance improvement. To achieve this, three things are necessary:

  • Clear vision
  • Strong leadership
  • Effective performance management

For these to be in place there are two further requirements. We need a sufficient number of senior managers and elected members in Wales who have a clear and achievable vision for local public services. And the Welsh Government should get out of the way. It is part of the problem not part of the solution.

Malcolm Prowle, who lives in Wales, is professor of business performance at Nottingham Business School and a visiting professor at the Open University Business School.

4 thoughts on “Why we don’t need another reorganisation

  1. Rarely do I read a piece and find myself agreeing with every word. Welsh government has seldom covered itself in glory since devolution and its superior attitude to local government is unwarranted. Unitary authorities were a bad mistake – inferior in every way to the preceding structure of district council and county councils. Trying to save money by squeezing disparate responsibilities into one structure was a huge mistake. To consolidate further without a true local tier would be another big mistake eviscerating local democracy – something that only the Stalinists among us would appreciate. We can’t go back so leave structure alone and concentrate on improving processes and outcomes. Welsh government should now devolve more powers to local authorities – the power to set business rates for example.

  2. A very interesting series of thoughts. Particularly the comment about the strengths of the civil service. The upper echelons of the civil service have always been dominated by those with a erudite turn of phrase whose speciality is the finely tuned policy brief for Minister’s. The route to the top is largely characterised by spells in spending functions designing policy that is the responsibility of others to execute. The very best are frequently hand-picked to run Ministerial private offices. Things like general management skills and organising and delivering capital programmes, which are taken for granted in most other walks of life, are too often regarded as second order priorities.

    I offer no opinion on the rights or wrongs of the principles of the decision but when the Administration brought the WDA and others into the executive branch of the Assembly anybody with any experience of these matters would have been aware that apparently small issues like the compatibility of IT systems and the terms and conditions of employment required urgent resolution. Failure to acknowledge them at an early stage seems to me to lend credence to Malcolm’s comments.

  3. My limited experience leads me to welcome Welsh Government take over or interference in local authority functions.

    Our LA (Pembrokeshire) is led by a tiny group who have no vision or understanding of the changes ahead or how to deal with them. They hold secret meetings without agenda or minutes, and stifle any interference from elected members. Most elected membes are community councillors who were particularly good at remembering everyone’s name and greeting their pets. Nothing has happened to them to make them more able to handle the exceptional power of local authorities, no training or experience outside their small circle of old mates. They are good at knowing every pot hole and street light failure, but nothing about the global economy, energy security, funding cuts or demographic challenges.

    The lack of leadership, knowledge and vision is quite frightening given that we need to adjust to a range of dramatic changes. The policy documents coming from Welsh government are awake and relevant. Their implementation is feeble to non-existant. I feel that a large part of this is due to local authorities inability to implement anything far seeing.

    For these reasons I feel stronger more centralised vision is necessary along with more freedom to implement this vision in a decentralised way. Judging by my own local authority, they are good at keeping the street lights on and the pot holes filled, and this is not to be sniffed at, but that’s it.

  4. “Decisions should be made at the geographical level that matches the consequences of those decisions”… seems to me a good principle.

    There are clearly plenty of examples in Wales where this is not the case. For example, Transport in South East Wales. The South East Wales Transport Alliance (SEWTA) is a valiant attempt to provide a regional dimension to transport policy. However, this body has no statutory powers or funding and in many cases only provides a means to collate transport wish lists from 10 local authorities rather than developing a strategic vision for the region. This is not the fault of the members or officers involved but is a fundamental weakness in its governance and the fact that local political pressures often hold sway over strategic regional considerations. SEWTA is working with one hand tied behind its back.

    Furthermore, given rail infrastructure is a non-devolved matter, SEWTA has been unable to compete with the large Passenger Transport authorities in England who have effectively lobbied the DfT in London to secure funding for major rail schemes across of England/Wales. One only has to look at the ~£1Bn additional investment committed to the Manchester Metrolink (with EIB support) and a similar figure to upgrade the Newcastle Metro. There are plenty of other examples.

    Nearly 600,00 people work across the wider Cardiff City Region, over a third in Cardiff; commuting into the city is already nearly at 80,000 per day and is forecast to increase given that over 60% of new jobs in the region have been created in Cardiff over the last ten years. The urban geography of this part of Wales requires public bodies to reflect this city region dimension.

    Yes we can work together more effectively for the common good. However, in some cases we have to recognise that the current structures are just not working and need a major overhaul. In respect of the Cardiff City Region, we need a regional Passenger Transport Authority or similar that has full powers and funding necessary to develop a strategic vision for transport and then oversee its implementation. The development of a Cardiff/Newport/Valleys Metro is critically dependant on the establishment of such a body; we also risk impeding our economic recovery without it.

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