Budget series: Look beyond Brexit readiness

This post first appeared on our old blog on 20th November, 2017

Tom Davis shares his dream budget for the public sector.

Written by Josh Gaw

The public sector is fighting an uphill battle: never-ending cuts, increasing work hours and consistent recruitment challenges, all while being expected to deliver high-quality services. Whitehall departments have not escaped these cuts, with the Chancellor outlining aims in the Spring Budget to deliver £3.5 billion of resource savings in 2019-20 alongside an efficiency review to bring down departmental spend.

Scrapping the 1% public sector pay cap in September was a step in the right direction for many in the public sector. However, there is still scepticism with some calling for the Government to take this approach further still.

The all-encompassing focus on Brexit shadows the public sector though, with the potential for more cuts and efficiency reviews to prepare departments for a post-Brexit UK even more likely. Whilst Whitehall and NHS productivity are key, the Chancellor must not overlook the needs at regional and local levels.

With the pay cap already announced, it’s vital this Budget takes the opportunity to announce more measures to help the public sector thrive. Brexit will undoubtedly dominate thinking, but it is critical Hammond looks beyond Whitehall efficiencies. The UK’s exit will leave a blackhole of regional funding under which local authorities will suffer. The Government must look at solutions to fill this gap.

Our dream budget for the public sector would see four key announcements:

Promoting small business and local economies
It would be great to see the Chancellor introduce measures to further encourage local and central government use of small and medium-sized businesses, recognising the positive local footprint many have, the levels of innovation and disruptive thinking they often bring, and in many case the added social value they generate.

Better funding for local authorities to pay for homecare
Most local authorities outsource homecare to sub-contractors – often local or regional social enterprises. A recent court case compels these suppliers to better pay employees who undertake ‘sleep-in’ shifts. While this is welcome and fair, with local authorities unable or unwilling to increase the rates that they pay for these services, and taken alongside additional workforce pressures of a growing National Living Wage and shrinking numbers, many of their sub-contractors now risk going out of business. Government needs to get on with the promised Green Paper on care funding and get to a sustainable across-the-board solution as quickly as possible. It could start well by taking up the recent offer of by MPs from both sides of the House for a truly cross-party approach to tackling this multi-generational challenge that has gone unanswered for too long.

Further promotion of mutualisation
As highlighted in a previous post, mutualisation holds untapped potential to bring even greater levels of productivity in service delivery, supporting teams to be more efficient, innovative and create higher levels of positive engagement. Our dream budget scenario would see the Government continuing to support initiatives like DDCMS’ Mutuals Support Programme, potentially looking at deeper support programmes that help public services overcome challenges they face when spinning out into alternative delivery models.

Have we got it right? Let us know what announcements you are hoping to see on 22 November on twitter: @WeAreBaxendale #hopesforhammond

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