The future of local government

This longread by Dr Andy Johnston is part of our Post-Covid Councils project.

On a daily basis we are reminded of the impact Covid 19 has had on our lives, for the most unfortunate their health has been affected or they have lost a loved one. For some the change is minimal, living roughly the same life but not going to the office. For others there has been a temporary pause until normality resumes and for some their livelihood has disappeared along with their employer and colleagues. It is at the most disruptive end of the scale that this paper focuses its attention. Much of the really disruptive change we’re observing is not due to Covid at all, it was going to happen anyway, the pandemic accelerated the change but did not create it.

The implications of Covid that are already evident are:

• a global recession;
• a negative impact on individual and community wellbeing;
• changes to work that will include the type of jobs we do and where we actually do them;
• a greater reliance on technology;
• an expansion of the state to address new needs; and
• a green reset.

Though all of the implications of Covid above are happening now, they represent a mixture of impacts, some of which, like recession, are undesirable but inevitable and others such as a green reset which represent a political choice. It’s that blend of the unavoidable and the desirable that local government will find itself negotiating in the coming years. As organisations that have democratic decision making backed by a professional civil service they should be well placed to lead change.

This paper does not attempt to propose a blueprint for the local authority of the future. Instead it will look at the major implications of Covid, incorporate other global trends that are washing over us and create scenarios, which will shine a helpful light but are inevitably simplifications of reality. These scenarios will be visions of the future but not disconnected from the current reality. Consequently, they will also examine the transitions required to achieve change in a realistic way.

Before the types of scenarios are decided it’s worth unpacking the implications of Covid and what they mean for local government.

Already global GDP has taken a hit and by the time the pandemic is under control the world economy will have shrunk and we will have created massive debt for future generations to pay off. There are immediate effects on local authorities, those systems that rely heavily on central government funds will have those funds cut as belts tighten and Finance Ministries try to minimise spending. At present, local authorities under such systems are probably better off than those that have devolved fundraising powers and rely on land taxes or service charges. Those local authorities with local tax bases and limited borrowing powers are being hit hard by the loss of income from business rates, car parking charges, leisure centre fees etc.

However, in the long term those councils reliant upon central government funding have only one strategy for financial recovery – to ask for funds from central government. Those local authorities which had robust local finances before the pandemic can rebuild them. That rebuilding will provide an opportunity to enhance the fiscal system of the local authority.

It seems odd that an organisation reliant upon a healthy local economy to thrive and with a remit to facilitate the growth of that local economy is placed in a semi-detached position from that economy. Many local authorities rely upon business rates and many local authorities have teams that stimulate local economic growth yet there are few fiscal or governance connections between these activities. If there were it should be easier to react to recession.

Because there was a global recession in 2008/10 then possible responses are known. The local authority could have its budget dramatically cut driving radical efficiencies and withdrawing from some services. The entrepreneurial spirit within the local authority could be released to drive new ways of delivering services that are not only cheaper but actually generate funds. There could be accelerated reaching out to partners in the private sector and civil society so that services could be co-designed and co-delivered. There could be administrative efficiencies found by technology or collaboration between local authorities. There could be a drive for aggregation in order to benefit from economies of scale.

All these responses have been tried and some have worked financially. However, they have all suffered from a corresponding decline in the health of local democracy. This is most obvious when aggregation of local authorities results in larger organisations distant from the communities they serve. It applies when turning local authorities into businesses, it applies if partnering with democratically unaccountable organisations to deliver services, it applies where technology displaces human contact or where automated decision-making cannot embrace local nuance. This is not a reason to abandon fiscal responses to recession but to recognise the drawbacks and adapt. Already there is growth in participatory budgeting as a way of involving communities in financial decisions that affect them, further innovation is possible.

At the beginning of the pandemic the public health issue was very clear and much effort was put into social distancing and preventing the spread of Covid. Quite soon the public health remit expanded to include isolation of care homes, test-track and trace, coordination of mutual aid groups and distribution of PPE.

As things developed over June and July more complex public health issues emerged such as loneliness, depression, domestic violence, care of the disabled, homelessness, drug and alcohol misuse, obesity, food quality/quantity, exercise and participation sport.

There are inspiring examples of communities coming together and working to help others and many local authorities have gone the extra mile to support their communities sometimes at the cost of staff wellbeing and certainly a financial cost. While in the first lockdown it felt as though there would be an end and an opportunity for recovery. As the pandemic lingers the negative impacts became more embedded and the enthusiasm to tackle them has reduced.

It is a good thing that community understanding of public health has widened beyond providing kit and doing tests. Arguably, it is a watershed with far more people becoming aware that doctors and hospitals on their own can’t cure a pandemic and that the medical symptoms of Covid are only a part of the health impacts of the disease. It has at least heightened concern about how health providers and local authorities work together and sharpened our societal view of adult social care. The devolved nature of health and public health have also shown that national governments are unable to just pull a lever of state control and manage a pandemic, they have to work with local partners because the pandemic does not behave the same in all locations and among all populations.

There is a risk that a state level response will be to demand more levers, override local knowledge and put health professionals in charge of complex community issues. This paper instead argues that we need to find more local solutions, unlock community support and develop inclusive processes that enable people and communities to manage their own wellbeing.

In the background of the change needed is the role of technology. We are now used to seeing a surgeon perform operations remotely via a robot but the important changes might be more prosaic. In the past we needed an appointment to see the doctor and took the trip to A&E. Covid has shown that A&E usage can be reduced and that doctors usually don’t need to see you in order to help. The advent of smart watches that monitor your health (eg blood pressure) could mean that the doctor doesn’t even have to wait until you get in touch to know that you’re unwell. Instead they will have an alert system that connects to your smart watch. This is important as its preventative health care, traditionally the remit of public health and should result in stronger cooperation between health services and local authorities.

Probably the most obvious impact of Covid for most employees has been the relocation of work from an office to home. For many this shift, though painful at the time, has improved quality of life. Most employers are now openly talking about a blended working week made up of home working and office time. This shift is not however an unalloyed benefit to all. Those whose home situation is not suitable for work or jobs that require presence or employees who work better with real human contact have been adversely affected. We are all now painfully aware of the limits of the technology.

While the debate is ongoing for the HR benefits of homeworking, the financial benefits for employers are already clear and that factor alone probably means much of this transition is irreversible. Some employers are already working through the pitfalls and benefits of this redefinition of work from something done from 9 to 5 in an office (or other workplace), to a quantum of output required at a certain quality by a certain time. Increasingly, we will see a divide in society between those who can work remotely and those who can’t. Regardless of the location of work, the gig economy will expand as employees trade off the uncertain pay and conditions for greater flexibility. As definitions of a job change so do the definitions of a good job.

The long-term impacts are profound. Local authorities with fiscal strategies that rely upon business rates are in for a bumpy ride as the office sector shrinks and online retail grows. Local Authority HR strategies will need to develop beyond a form filling, office based, performance checking appraisal cycle to continuous development assessed by a mixture of human interaction and technology.

Where local authorities have responsibilities for education there have been immediate shifts to online learning, built on the increased use of technology in the classroom. Educations systems are generally very good at instilling basic skills, useful transferrable skills and increasingly, social skills. There has been a debate for a while about the usefulness of parcels of knowledge as opposed to an ability to learn, the adage that 50% of jobs for a school leaver don’t exist when they start school. If lots of new jobs will be out there, it follows that some of old jobs won’t be and the remaining old jobs will be undertaken differently. It’s predicted that accountants, bankers, lawyers, telesales are all jobs that can be easily automated and that goes for tasks such as licensing, planning and taxation in local government.

As these changes work through we will have choices. In the same way that a local authority can influence electric vehicle markets by using their purchasing muscle so can they influence future employment by developing the work practices of the future amongst their employees and communicating those consequences back to colleagues in other sectors.

To a large degree the technological innovations that will shape our lives for a generation already exist. Renewable energy is more efficient, electric vehicles work, meat substitutes are cheap and taste okay. The challenge is predicting how they can be deployed and constructing ethical codes around their use.

The immediate changes wrought by Covid are quite modest, teleconferencing and document sharing are hardly the cutting edge. If Covid continues to require social distancing in some form then that will open up opportunities for technology that bridges the gap. Machines and robots don’t carry the virus and can act as intermediaries in our lives. Care homes already use simple robots as companions freeing up staff time.

It’s taken for granted that these innovations will emerge from the private sector and that local authorities will be consumers of the new products and services. That does seem likely. However, local authorities should fully engage and innovate themselves where gaps exist.

Algorithms are becoming ubiquitous and artificial intelligence will mean that decisions made by machines are quicker and more reliable than humans. Local authorities have already dabbled in face recognition AI. It didn’t go well. Lessons should be learned about the ethical framework that surrounds the deployment of new technologies.

Local authorities in their economic development function would welcome tech companies and focus on the extra number of employees, the potential for the next silicon valley, whether they’ve got enough housing, good schools, shops, theatres and sports facilities to encourage employees to move in and stay. Some local authorities actively seek out technologies that fit a local economic development strategy, which could mean building on existing local capacity or attracting industries that complement a political strategy.

Questions will arise about whether local government can maintain a morally neutral position on the deployment of new technology, whether it’s tech they buy or allow to operate in their place or whose manufacture they actually encourage in their communities.

Despite the political desire to limit tax and spend, the history of modern government is that a crisis is a trigger to expand. The most obvious step change was the creation of welfare states after the Second World War but crises have always led to increased activity by government in response and once in place it’s hard to go back. Covid has already precipitated two significant incursions into our lives by the state, lockdowns and wage support schemes. In both cases a line has been crossed and it’s now legitimate to ask under what future circumstances would government do the same.

Covid has resulted in the greatest curb to freedoms outside wartime. In the name of public health socialising has been limited, schools closed, businesses shut down and the tourism sector brought to its knees. We know that Covid is not a one-off; there were warnings with SARS and swine flu. A new coronavirus will emerge in the next decade, it may not be as deadly as this Covid-19, but it might be. This realisation has profound impacts on our view of a public health service. In 2019 Public Health England’s top four priorities were smoking, diet, clean air and better mental health. These challenges are all very important but English government strategy was notable for its use of soft persuasion to change people’s behaviour, no bans and very limited interference with the private sector.

One of the lessons of public health responses to Covid was that in the first wave countries with well-resourced independent local public health regimes fared better and that in centralised countries a more devolved system was adopted as the flaws in centralised thinking became evident. That means that resourcing prevention schemes and deploying a more intrusive set of remedies to a public health crisis is not the sole responsibility of national government, it’s a local issue as well.

When the furlough scheme was introduced it was hailed as a more sensitive response to a financial crisis than the propping up of the banks in 2008 it was perceived that quantitative easing helped banks but the innocent victims of recession received nothing. Now the state is giving wages directly to citizens in amounts a welfare system could only dream of.

Given the cyclical nature of economies there will be another financial crisis and there will now be calls for furlough to be reintroduced. Those calls will be hard to ignore and so it’s likely that a long-term strategy could evolve. At one end of the scale a new furlough scheme could be expected and the means for paying for it developed. At the other end of the scale is to remove the need for a furlough altogether because the government already pays a universal basic income.

Somewhere in between another national furlough and UBI is the local financial crisis. If paying wages to see a country through a temporary financial crisis makes sense then paying wages if a local crisis happens could as well. Before national lockdown 2.0 in the UK there were local schemes. The rule seems to be that if the state closes down your means of employment it should cover your costs regardless of geographic scale. This is a whole new chapter in the social contract, because it’s nothing to do with welfare, its compensation.

Stepping away from Covid it’s worth exploring the potential for further crises and hence further expansion of the state. Climate change has the potential to upend certainties in the same way as a pandemic. While high rainfall and flooding are increasing in severity and frequency there has not yet been an inundation that makes large areas uninhabitable and there may not be. It’s more likely that such a large-scale disaster will result from inundation by the sea. Faced with thousands of people homeless with no prospect of return in a year what does government do? The answer probably involves lots of caravans and private homeowners becoming social housing tenants.

The pandemic has reminded politicians that some issues are immune to soaring rhetoric, cunning persuasion or wishful thinking. So it is for the environmental challenges the planet faces. Climate change is the most talked about but biodiversity loss, habitat loss, air quality, water quality and plastic waste are all issues that need to be addressed.

Every local authority can point to progress on some of these issues, either as a local initiative or as part of a national programme. The type of action can range from the tokenistic through to a full strategic commitment. Most local authorities are somewhere in the middle, simultaneously protecting the environment in one place and promoting environmentally harmful economic development in another. It is in the imaginative resolution of these contradictions that progress lies, not one argument trumping another.

In most countries a history of incremental awareness of environmental issues has led to a fragmented regulatory and policy approach. At any point in its progress, a flood can be the responsibility of an environmental agency, a highways department, individual landowners, local authorities, utilities providers or no one. Conservation agencies try to prevent harm to sensitive habitats or species, the voluntary sector buys land and manages it for conservation, farmers are paid to protect certain habitats, local authorities write plans.

The narrative of ecosystem services is beginning to bring a coherent framework in which to manage interactions with our natural environment. We now understand that a healthy natural environment improves our wellbeing, we understand that we rely upon the natural environment for clean water and air and it’s becoming clearer and clearer that not valuing these services causes them to diminish.

More than most issues scale matters for our natural environment and scale is dictated by our natural environment. River flooding can only be effectively managed on a catchment basis, habitat conservation needs to be at landscape scale and climate change is a global challenge. Actual action relies upon governments national and local who generally don’t have borders that coincide with nature. At every scale this means that a government should do what it can and it should collaborate.

There are some outstanding examples of local authorities ‘greening’ and showing what can be done. In Australia, many local councils had net zero emissions by 2050 targets or aspirations. Four of the local councils were already carbon neutral: Moreland City Council, City of Sydney, City of Melbourne and Brisbane City Council. In Scotland, an example of a large scale, regionally-based approach is the ‘Clyde-Mission – Clyde-Corridor’ National Development proposal from the Glasgow City Region City Deal, which also incorporates a proposed ‘Clyde Climate Forest’. In Ireland Wicklow County Council developed a waste prevention initiative, a competition called Relove Fashion, focused on the repurposing of textiles to create new outfits.

These councils should be praised and the learning shared. However, the fact that they are outstanding should be a cause for concern and indicates a failure of collaboration. Collaboration is difficult. Collaboration is difficult if two local authorities have different political perspectives, different economies and different demographics. Collaboration is also practically difficult. I sit on the Thames Region Regional Flood and Coastal Committee, it’s a vast area taking in 57 upper tier local authorities and it’s very difficult to make a decision without creating sub-groups, and that’s only one environmental issue.

The challenge for local authorities is to work across multiple geographies and ensure they are making optimal contributions at each scale and that the sum of activity is greater than the parts. Improving the biodiversity of a park is an internal geography and has value, but has much greater value if the park is joined to other wildlife spaces in neighbouring authorities by a clean river and the combination of spaces also provides flood protection and acts as a carbon sink.

Climate change is a global challenge but reducing emissions can happen at any scale and contribute to stabilising greenhouse gases. Local authorities have shown that they can use their purchasing power to buy electric vehicles, they can collaborate with the private sector and other parts of the state to form heat networks and they can promote uptake of non-fossil fuel based light and heating. All these technologies are on the cusp of cost parity with the traditional sources so much wider uptake will start. Now is the time for local authorities to consider the next step and ensure the necessary infrastructure is in place, installers are trained, quality is assured and that the transition is as smooth as possible.