Councils must play integral role in economic and social rebuild

27 July 2021 3 min. read
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National and local governments must ‘rethink’ the role councils play in the wake of the coronavirus pandemic, if they are to ensure they present their constituents with the right level of services, and with improved value for money. According to a new report, the amount authorities spend on social care could consume three quarters of their budgets by the end of the decade, but they could avoid this by investing in innovative service delivery now.

Research from PwC has outlined how social care provision threatens to become an increasing burden on local authorities in the coming years. Between 2020 and 2021, the researchers found that adult social care, children’s services, education and environment and regulation accounted for 78% of all council spending. This could rise to 79% by 2030, and even hit 85% for some county councils.

In particular, adult social care is the biggest driver of this rise. At present, for all councils this is the largest single service area, and by the end of the decade could account for 35% of spending – a rise from £17 billion per year now to £24 billion in 2030.

Local government spending need analysis by service area 2020

PwC’s researchers suggest that councils can adapt now to lessen this blow – however it will require doing more than ‘just surviving.’ Instead of treading water, the study instead encourages councils to ‘rethink’ their organisations and role in society. Councils should seize on the opportunity presented by the pandemic to accelerate change and investment in the leaders of tomorrow, build more flexible working arrangements for their workforce, and embrace technology and automation in the delivery of services.

Paul Deegan, PwC’s Lead Partner in Health Industries and Local Services Consulting, said, “Our analysis shows that fundamental decisions must be taken now about the shape, resources and powers local authorities will need to continue to lead their places. Now is the time to capitalise on the role councils can play as leaders of place and ensure they remain relevant in 2030. This is a golden opportunity.”

PwC’s researchers polled citizens across England to assess what their chief concerns and priorities were – and how proactive work now might help address them. The results show that people clearly appreciate the economic roots to many social problems, which lead to a dependence on social care.

What government interventions do you believe would be most effective in levelling up the country and reducing inequality

For a start, 70% of people noted the need for better quality and more affordable housing. Homelessness and rough sleeping are major contributors to councils’ social care bill, so better housing could both reduce inequality and help for a long-term reduction in social care spending.

Similarly, helping people access better paying jobs was noted by 49% of respondents, while 44% said investing in skills to help people prepare for the future should be a priority. In a similar way, this would reduce the social care burden on councils – both as it would help reduce long-term unemployment and enable lower income communities to improve their quality of life. Before any of this, however, empowering local authorities to achieve these goals is essential.

Deegan added, “Local government recognises the need for accelerated change. National government needs to create the environment that allows this to happen. National government has an opportunity to recognise the strength of local government and the level of trust placed in councils by their residents. By putting councils with the size and scale to lead at a local level in the driving seat, agreeing more ambitious devolution deals at a county level, it is much more likely to achieve its levelling up ambitions.”