The local authority landscape is changing

It is a challenging time for many local authorities, as they grapple with proposed reforms contained in December’s English Devolution White Paper. Plans to expand and extend the Mayoral Strategic Authority model across the whole of England, as well as proposed reforms of the two-tier local authority structure, will usher in what some have described as generational change, putting increased pressure on already under-resourced authorities.

By empowering decision makers on the ground, who understand local priorities and preferences, the ambition is to stimulate growth and streamline service delivery. Implemented well, a unitary authority approach, backed by multi-year funding settlements, has the potential to offer genuine joined-up, shared-service efficiencies and economies of scale – although, as authorities become larger, there are concerns over connection to, and representation for, smaller, rural communities, raising questions around whether the devolution proposed is radical enough.

What we do know for certain is, because it will involve people and change, restructuring on this scale is never as simple as the plan on paper and these transitions will pose a significant challenge for local leaders and their staff.

The White Paper in brief

The reforms aim to empower local authorities to become more strategic, effective, agile and accountable, and to enable them to better meet the needs of the communities they represent. By devolving more powers, streamlining funding, and creating a more collaborative approach between central and local government, these reforms aim to build a more robust and responsive local governance system.

The goal is to stimulate growth at a local level, so Mayoral Strategic Authorities, for example, will have enhanced powers over transport and infrastructure, housing and planning, economic development, education and skills, health and social care, and public safety, to address what the White Paper describes as the current ‘parent-child’ relationship between central and local government.

The challenges

There are some big unanswered questions, however. How does the government ensure local agreement? Getting local deals done is a notoriously lengthy and difficult business. The establishing of geographical boundaries, local rivalries, vested interests, party politics all pose significant challenge. And what of the constituents themselves?

While a move away from competitive bidding and short-term approaches to funding sound good on paper, the White Paper is thin on the detail. After years of underfunding and with authorities already on the financial edge, how will change be resourced?

The government intends to work with the sector on support and development for elected members, and to address barriers to attracting and retaining the talent needed. Again, what this looks like in practice is yet to be worked out.

Local government is already in the midst of a talent crisis. How will local authorities attract and retain the expert talent they will need to lead change? And, with a workforce already under pressure from years of underfunding, how do leaders engage their people through the transition process? Recruitment, retention, engagement and development of the right talent will be key.

As the people function HR will be in the thick of it

Organisational restructuring is a stressful and anxious time for everyone involved. When merging two organisations into a new entity, roles will inevitably overlap. One of the most challenging aspects of a restructure are redundancies. Expert HR support will be crucial, not only to ensure fair and legal procedures, but also to offer career transition coaching and outplacement support.

With changes to roles and potential departures, there is a risk of losing valuable knowledge held by individuals and teams within individual authorities. Implementing knowledge-transfer programmes will be important, too.

Taking time to work with the remaining employees to ensure that they are motivated and engaged in the new world, will be of vital importance to achieving the strategic vision. There is no doubt, maintaining business as usual, in the midst of change, will be difficult. As the people function, HR will be a key driver.

 Read more about Getting the best out of your people, during a restructure.

Scrutiny and accountability

With greater budgetary freedom comes greater responsibility. A focus on financial resilience, accountability, auditing, and compliance will put the spotlight on the finance function. Managing larger multi-year settlements and ensuring value for money means longer term financial planning. Again, how does the sector attract the expert, commercially astute, finance talent that will be required to manage and account for spending and performance in the new world?

Digital transformation

Our work in the NHS, supporting health and social care organisations transitioning to Integrated Care System partnership working, tells us digital transformation will be necessary to fully realise potential efficiency savings. On the positive side, the move to a unitary authority approach offers leaders the opportunity to genuinely transform from the ground up. Enabling organisations to do more with less requires a strategic approach from the start. Again, this will require expert support. Successful transformation occurs when strategy, structure, processes, and people are aligned.

In brief

Whether in healthcare, education or local government, the principle of devolving power to the people on the ground, aligning decision-making with local knowledge, priorities and expertise, is a positive one. Whether the English Devolution White Paper devolves power locally enough is moot, however.

With councils already under severe pressure these reforms will be a challenge. While lessons will have been learned from authorities that have already been through the process, to successfully navigate structural change on this level will require additional, expert people resource and funding.

The biggest step for many, will be the first: achieving an agreement between elected members on the best solution for the constituents they represent.

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