SUBJECT:

Report to SCRUTINY COMMITTEE 18th January 2007

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Subject: Local Government White Paper - A New Performance Framework

Status: Routine Matter for Information

Report Ref:

Ward(s): None

Key Decision: No

Key Decision Ref: n/a

Report Of: Head of Policy and Partnerships

Contact: Janice Brill – 01256 845626 [email protected]

Appendices: Appendix 1 – Performance Framework Briefing Paper CP48-06

Papers relied on to produce this report

Local Government White Paper – Strong and Prosperous Communities - Volume 1 and Volume 2

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SUMMARY

1 This Report

1.1 The Local Government White Paper ‘Strong and Prosperous Communities’ was published by the Department for Communities and Local Government in October 2006. Its aim is to give local people and local communities more influence and power to improve their lives.

1.2 The vision is one of revitalised local authorities, working with their partners, to reshape public services around the citizens and communities that use them. The White Paper suggests that in order for that to happen, the way local government works needs to change - to enable local partners to respond more flexibly to local needs, to reduce the amount of top-down control from central government, and to enable citizens and communities to play their part.

1.3 The White Paper has seven themes. The Policy and Partnerships Team has produced briefing papers on each one, and a headline summary. These identify the key proposals, and the potential impact on the Council and its partners. They are all available on Sinbad1. Copies have also been made available on the Council Website2.

1.4 At its meeting on 25th September 2006 Scrutiny Committee asked that the White Paper be an agenda item for this meeting. In particular the Committee wanted to discuss the impact of any changes to the performance

management framework in Local Government. It also wanted to review the relevance of national performance indicators, however the White Paper promises a fundamental change to the number and type of national indicators, so it is a little premature to review them at this stage.

1.5 A Briefing Paper covering the new performance framework is attached at Appendix 1.

1.6 The White Paper is not a consultation document in the strict sense. It is a clear statement of the policy intent of Government and will now progress through the Parliamentary Committee process. If the Council wishes to contribute to the debate it will need to do so by lobbying through the local MP and / or the Local Government Association.

However the Government will consult on and issue further guidance where appropriate and will work with local government and its partners to support and spread best practice. Further guidance is expected relating to

− The revised best value duty, including community participation, commissioning, competition and third sector funding;

1 Sinbad – Under ‘Corporate Themes’, then under ‘The Future of Local Government’

2 Web – Under ‘Your Council’, then ‘Priorities for the Future’, then ‘Local Government White Paper’

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− The Community Call for Action, Overview and Scrutiny and governance reforms;

− Local Strategic Partnerships, Sustainable Community Strategies and Local Area Agreements; and

− City development companies (driving regional and national economic growth.

1.7 Rather than send detailed reports to each Overview Committee, the Overview Management Board has asked that a workshop be arranged so that all Members can have opportunity to consider the White Paper in more detail. This will be held later in January 2007.

2 Recommendation

2.1 It is recommended that Scrutiny Committee notes the Local Government White Paper proposals in respect of a new performance management framework, and receives further reports on the practical implications as and when more detailed guidance emerges.

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PRIORITIES, IMPACTS AND RISKS

Contribution To Council Priorities

This report accords with the Council’s Budget and Policy Framework

Council 3 Year Plan References: 1.3 – Improvements in services

1.11, 1.14 – Effective partnership arrangements

1.18 – Local Area Agreements

Service Plan References: PO12 – White Paper preparation

Other References: None

Contribution To Community Strategy

Community Strategy Objectives: All – through proposals relating to community leadership, Local Area Agreements, and area based assessment

Impacts

TypeNo

significant impacts

Some impacts

Significant impacts

Impacts for BDBC

Financial

Personnel

Legal

Impacts on Wellbeing

Equality and Diversity

Crime and Disorder

Health

Environment

Economic

Involving Others

Communication/Consultation Para 1.6

Partners

Risk Assessment

Number of risks identified: 2 – Para 5.4

Number of risks considered HIGH or Medium:

None

Strategic:Already identified on Corporate Risk Register?

YesRR12 and 13

No

Operational: Already identified in Service Plans?Yes

No

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DETAIL/MAIN CONSIDERATIONS

3 Background to the White Paper

3.1 The opening statement in the White Paper by the Secretary of State for Communities recognises that radical improvements have been made in public services in the last ten years thanks to record levels of investment, strong performance management and the hard work and commitment of local government and others. For those improvements to continue, the Government believes it is necessary to introduce changes to the way local government works, and its relationship with central government, partners, and local communities.

3.2 The White Paper sets out proposals for a rebalance of the central – local relationship, and a new role for councils focusing on strong strategic leadership, effective local partnership working on cross-cutting issues, and giving more information to local people to better meet their needs through greater community consultation and involvement.

3.3 The White Paper is in two volumes, with the main proposals for change in volume one, and volume two containing thematic chapters on community safety, health and well-being, vulnerable people, children young people and families, economic development, housing and planning, climate change, and the voluntary sector.

4 The White Paper Themes

4.1 There are seven themes in the White Paper. A headline briefing paper is available on both Sinbad and the Council Website. Copies are available from the Policy and Partnerships Team on request. Each will be explained in more detail at the Member Workshop in January 2007. In summary the themes are:

− Responsive services and empowered communities - Suggesting that service improvement needs to be driven by individual choice and community involvement in decision-making. 

− Effective, accountable and responsive local government - Emphasising the importance of local government leadership and proposing a range of changes to council constitutions requiring new legislation.

− Strong cities, strategic regions - Discussing the government's approach to economic development, particularly city regions.  However, decisions are deferred, pending a report feeding into the Comprehensive Spending Review.

− Local government as a strategic leader and place-shaper - Considering the need for councils to have a strengthened community leadership and place-shaping role and putting forward proposals to develop Local Strategic Partnerships and Local Area Agreements.

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− A new performance framework - Setting out a new performance framework which aims to reduce the number of nationally-required targets, providing new opportunities for local accountability and multi-agency assessment.

− Efficiency, transforming local services - Emphasising the need to drive efficiency in use of resources, including new technology.

− Community cohesion - Emphasising the need to provide more specific support to councils and their partners in addressing community cohesion issues. 

5 A New Performance Framework

5.1 The Government believes that performance has improved since 1997, but that there are still challenges in addressing a continuing decline in public satisfaction, and in driving improvements in discrete areas and authorities where performance remains low.

5.2 The White Paper therefore contains significant proposals for change to the performance requirements that central government places on local government. These are identified in the Briefing Paper at Appendix 1. In summary the main proposals are:

1) Strengthening accountability to citizens and communities – Giving more opportunities to local people to shape the services they receive, and to be directly involved in running services.

2) Giving greater responsibility to local authorities and their partners for securing improvements in services – Local Area Agreements will provide a basis on which local partners can come together to negotiate and deliver local services in a more coherent way. Aligned to this the Government is keen to introduce ‘cross-sectoral’ responsibility for performance management and improvement.

3) Providing a better balance between national and local priorities – Rationalising the performance indicator regime, which is currently seen as top-down and burdomesome.

4) Improving arrangements for external assessment and inspection – This is still seen as important but the Government intends to work with inspectorates to reform, rationalise and reduce inspection activity.

5) Streamlining the process for providing improvement support and intervention – Though this will only apply in a minority of cases, the White Paper also sets out a series of elements to provide support for improvement and ways to address poor performance.

5.3 Within the main proposals there are some important changes that will impact on the Council:

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1) A new performance indicator framework comprising:

− National priority outcomes and indicators – Around 200 non negotiable targets set by Government

− Floor targets - Improvement targets, invoked on a case-by-case basis where minimum standards are not being met (e.g. as is the case with the current Planning Standard)

− Negotiable targets - Set between the Government and local partners through Local Area Agreements (LAA), up to a maximum of 35 for each area

− Local targets - Set by the council and its partners, though not subject to Government monitoring.

2) A duty on single tier and unitary councils to prepare a Local Area Agreement in consultation with others, alongside the Sustainable Community Strategy, and a duty of named partners to co-operate in agreeing targets. District Councils will be required to co-operate fully and will need to demonstrate their involvement and commitment to delivery of the Local Area Agreement and any agreed specific targets.

3) New guidance on Best Value, emphasising the need to prioritise the needs of citizens and users in commissioning and designing services and seeking to ensure robust competition.

4) Removal of the requirements for local authorities to prepare Annual Best Value Performance Plans and conduct best value reviews. However it will be replaced by an expectation that authorities will publish more timely performance information on progress with both the Sustainable Community Strategy and the Local Area Agreement. In addition an annual report on Local Area Agreements will be introduced.

5) Changes to the assessment and inspection regime will include:

− In the short term, extending the new Comprehensive Performance Assessment (based on risk rather than automatic rolling programmes of inspection) to Unitary Councils – it is already in place for district councils

− From 2009, development of a Comprehensive Area Assessment, again based on a combination of risk assessment and audit, but covering a range of service providers in an area – looking at how they work in partnership to secure better outcomes for local people.

− The annual report referred to in 4) above will be fed into the Audit Commission and other inspectorates, and will inform an annual review of the area's overall performance co-ordinated by the Government Office for the region.

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6) Publication of a national improvement strategy to tackle poor performance.  Where improvements are not forthcoming, national intervention powers will be retained and enhanced.  These include Government Offices working closely with local authorities to co-ordinate support, inspection, formal intervention by the Secretary of State, improvement notices which can be served to a single local authority but also to a partnership, statutory Directions which also can be applied to partnerships, and ultimately removal of functions.

5.4 In terms of risks associated with the new performance framework, the Council will need to ensure that it recognises and applies any new statutory obligations that emerge from the White Paper, and makes appropriate provision in the constitution, otherwise we could attract adverse comments or formal action from the regulators. The second main risk relates to our relationship with partners – if these falter it could have a significant impact on the success of Local Area Agreements, and the outcomes of cross-partner assessment processes.

6 Other Matters of Interest Relating to Scrutiny

6.1 There are specific proposals in the other themes of the White Paper that could have an impact on Scrutiny Committee, or that will be of interest to Members engaged in the scrutiny function. They include:

1) Introduction of Community Call for Action arrangements to formalise the right of local people to raise local concerns with their ward councillor on local government matters and issues covered by partnerships within which the council is engaged.  Councillors will act as gatekeepers, and will be able to act to resolve issues and to reject vexatious complaints.  If the matter cannot be dealt with in other ways, it could be referred to the council's overview and scrutiny committee(s), which can require a response from relevant public bodies. Local level budgets could be devolved to Ward members to deal with local issues.

2) Extending overview and scrutiny powers to include key partner organisations also covered by the duty to co-operate with Local Area Agreements and who will be engaged with the Community Calls to Action.

3) As District Councils are expected to develop new ways of working with County level Local Area Agreements and Local Strategic Partnership there may be a role for Scrutiny Committee as Government will expect to see evidence of full involvement.

4) Ambitious efficiency gains to be required as part of the 2007 Comprehensive Spending Review including a more radical and ambitious Value for Money programme with direct challenge for poorly performing or expensive services – again an area that Scrutiny Committee could have a role in.

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5) An expectation that Councils will use more collaboration and joint delivery options to meet customer need, ensuring administrative boundaries do not act as a barrier to service improvement and efficiency. There could be a scrutiny role here liked to the wider powers referred to in 2) above.

6) Promoting business improvement techniques and greater contestability in services to transform service delivery and focus on customer needs.

7) New guidance on how overview and scrutiny can support community cohesion.

7 The Next Steps

7.1 The proposals around the new performance framework are generally as anticipated, and the intended rationalisation is to be welcomed. However there are already some concerns about the balance between national and local target setting, and the practical arrangements for delivering Local Area Agreements in two-tier areas. It is fair to say that at present there is an absence of practical detail in the White Paper, so it is difficult to be clear about how the proposals will directly impact on us. There may well be changes as it moves through the Parliamentary process, and more detailed technical guidance is expected in due course.

7.2 The proposals in the White Paper will need to be considered alongside the report on the Lyons Review and the outcomes of the 2007 Comprehensive Spending Review. It is in the latter that the Government will set out the single set of national priority outcomes for local authorities working alone or in partnership (referred to at 5.3 (1)). On this basis it is probably sensible that Scrutiny Committee does not review the current national performance indicators as mentioned at the last meeting, as they are likely to change anyway.

G:\Policy & Partnerships\Local Government White Paper\Reports\07-01-18 - Scrutiny Committee - Performance Aspects.doc

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APPENDIX 1

Briefing Paper Ref No: CP48-06

Date: 31st October 2006

Local Government White Paper – Strong Prosperous Communities

A New Performance FrameworkThis briefing paper is based on the report: Intended distribution:

DCLG Local Government White Paper ‘Strong and Prosperous Communities’

Volume 1 – Chapter 6

Volume 2

SMT, Management Forum, Cabinet, LSP

Response required by: Author:

Not applicable Janice Brill, Performance Manager, Policy and Partnerships Team

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Background

This Briefing Paper concentrates on chapter 6 of the Local Government White Paper ‘Strong and Prosperous Communities’, relating to a new performance framework for local government.

The White Paper recognises that in the last 10 years the public sector has been successful in improving the quality of public services, working hard within the current national performance framework. However there are still key challenges - to address a continuing national decline in public satisfaction, and to drive improvements in discrete areas where performance remains low. There is concern that rates of improvement have slowed, and that there a number of separate performance regimes across the whole public sector, with a burdensome ‘top-down’ focus, contradictions, and arrangements that pull partners in different directions, making improvements hard to secure.

The main focus now is to strengthen the role of local government as a strategic leader in the locality, with a strong emphasis on bringing partners together to work towards agreed priorities. In turn this will necessitate a different approach to performance management. In particular this means reducing external targets and controls, and affording more freedoms and powers for local authorities and their partners. This will enable them to meet the needs of their communities, to tackle complex cross-cutting issues, and to encourage local people to play a part in shaping services.

The suggestions build on an earlier discussion document Securing Better Outcomes – Developing a New Performance Management Framework. This focused on how the intended programme of devolution, reform and modernisation in local government would be underpinned by a performance framework which recognised achievement, provided greater opportunity to shape local services to local needs, challenged complacency and encouraged innovation and improvement.

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Key Issues

The following summarises the five strands of the new performance framework:

(1) Strengthening accountability to citizens and communities

The emphasis here is giving more opportunities to local people to shape the services they receive, to empower them to take control of decisions that affect them and to be directly involved in running services. In terms of performance management the White Paper suggests that this ‘bottom-up’ approach will increase pressure to improve service delivery. The main changes proposed are:

encouraging authorities to provide local people with prompt information on the quality and performance of local services

giving people a new right to an answer when they put forward suggestions or demand action from their local authorities

clarifying responsibilities for local authorities and their partners in responding and reporting to citizens

developing Local Area Agreements (LAA) as the means of securing national priorities locally in a co-ordinated way, allowing more space for local prioritisation

ensuring independent assessment and inspection are more reflective of and responsive to citizen and user views

(2) Giving greater responsibility to local authorities and their partners for securing improvements in services

LAA’s have provided a basis on which local partners can come together to negotiate and deliver local services in a more coherent way. Aligned to this the Government is keen to introduce ‘cross-sectoral’ responsibility for performance management and improvement. There are no specific proposals at present, though the White Paper suggests:

encouraging and strengthening peer challenge and support, and eventually placing more reliance on it as a mechanism to drive improvement and shared learning

providing real-time, accurate, accessible and up-to-date information on service performance. This has two impacts – the public can use it to hold the council and partners to account, and the service providers should use it as an early warning to initiate action

promoting strategic commissioning, and the use of alternate providers, to drive innovation, efficiency and improvement. Whilst not intended as a return to outsourcing and CCT the White Paper does comment on the need to develop markets and ensure open and fair competition

retaining the duty of Best Value, and reinforcing the principles of the ‘4Cs’.There will be some reform, in particular - removing the requirement to conduct Best Value reviews and to publish an

annual performance plan increasing the focus on consultation, requiring councils to secure

participation of local people in their activities strengthening competition to drive innovation, improve under-performance,

and generate efficiency

(3) Providing a better balance between national and local priorities

The current monitoring regime is seen as top-down and burdomesome. The proposals

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include:

a revised LAA process through which central government and local partners will agree and manage a limited number of improvement targets. The aim will be to negotiate a balance between local priorities and national expectations

local authorities will be expected to provide a self-assessment on progress against the LAA and other targets each year. This information will be fed to the Audit Commission and other inspectorates, and inform an annual review of the area's performance co-ordinated by the Government Office for the Region

a new approach to performance indicators. At present there are up to 1,200 indicators across the public sector and the White Paper commits to reducing that to a single set of around 200 designed to assess joint outcomes across all relevant partners. The framework will be: National priority outcomes and indicators - Non negotiable targets set by

Government Floor targets - Improvement targets, invoked on a case-by-case basis where

minimum standards are not being met (e.g. as is the case with the current Planning Standard)

Negotiable targets - Set between the Government and local partners through LAA’s, up to a maximum of 35 for each area

Local targets - Set by the council and its partners. Not subject to Government monitoring

It is important to note that at present we report on 79 national indicators – it is possible that the burden on us will actually increase as a result.

Though not specified in any detail, it appears that the current national reporting mechanisms will be reviewed on the basis of ‘report once – use many times’, making it easier to submit information, and easier for others to access and use data

(4) Improving the arrangements for external assessment and inspection

The Government maintains that external assessment and inspection still has an important role to play as an effective catalyst for improvement in local, and in accountability and public assurance. However it has now indicated its intention to work with inspectorates to reform, rationalise and reduce inspection activity.

There is little specific detail about proposals post 2009. The White Paper comments on a new regime labelled ‘Comprehensive Area Assessment’. This will have less emphasis on separate, institution-based assessment, and more on local service commissioners, providers but regulators working in partnership to secure better outcomes for local people.

With an area focus there is the potential to better reflect local citizens’ perspectives on service delivery, their neighbourhood, and improvement, irrespective of boundaries of responsibility. The following judgements will be published:

an annual risk judgement, covering risks related to outcomes, services and organisations in the area, and the extent to which these risks are being effectively managed

a scored Direction of Travel judgement for each local authority, assessing the pace of improvement and the likelihood that this improvement will continue

a scored Use of Resources judgement for every local authority assessing organisational effectiveness and how well they use resources to support priorities and service improvements

judgements from any inspection activity flowing from the risk assessment.

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This is likely to impact more on unitary and county councils. Comprehensive Performance Assessment for district councils has recently changed to a similar risk-based approach, where councils experience a full assessment only where their performance is deteriorating, or they request it.

(5) Streamlining the process for providing improvement support and intervention

Though this will only apply in a minority of cases, the White Paper also sets out a series of elements to provide support for improvement and ways to address poor performance. The highlights are:

The Government will work with local government to agree a national ‘improvement strategy’ looking at how to build capacity so that local partnerships can analyse problems, set robust targets, agree and implement delivery plans and manage performance.

In tackling poor performance action will be tailored, depending on the issue at hand. This will be coordinated by Government offices. There will be provision for formal intervention by the Secretary of State, with Improvement Notices introduced to address significant or enduring under-performance in a single body or across a partnership, and ultimately removal of functions, the most extreme step.

Where performance is low and costs are high, consideration will need to be given to recommissioning services, including identifying alternative providers. This may be initiated by the local authority, partner or partnership concerned, or may be prompted by external action such as sectoral pressure or Government’s use of statutory powers.

Implications

The main emphasis is on reducing the top-down, centrally controlled framework that is currently in place, though the White Paper does not express in any great detail how this will actually be achieved at present. We anticipate that the Comprehensive Spending Review and the Lyons report are likely to have more detail about the practical way forward, and that further discussion papers will emerge in due course, for example on the Comprehensive Area Assessments and reduction in performance targets.

The obvious impacts on the Council will be:

− to play a pivotal role in terms of community leadership, and to take a strategic lead for the area as a whole, in particular engaging fully in the LAA process

− to develop effective governance arrangements that fit varied needs, and to secure effective multi-agency delivery arrangements

− to effectively engage the local community, particularly the more hard-to-reach, and to make sure their views help to shape priorities, improvement and standards

− to ‘facilitate’ joint performance management with partners, making sure data quality and best value principle are integral, and that scrutiny arrangements are in place

− to respond to the need to engage the community in setting standards for service delivery

removing the requirement to prepare a Best Value Performance Plans will have a minor impact. As an excellent council we have not had to prepare a Plan recently, but have been required to publish information in June as part of the Annual Report. We have already reviewed our approach to Best Value so again the removal of the need to conduct best value reviews will have little direct impact.

Some of the proposals will have a bigger impact on unitary and county councils, as they are faced with more targets and a more stringent CPA process at present, so will certainly

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benefit from a relaxation in monitoring and assessment.

Other specific theme related impacts of interest to us are:

Community safety - There will be a new performance assessment framework called Assessment of Policing and Community Safety (APACS) which will be aligned with the national indicator set described above.  This should enable local authorities, police and other partners all to work to the same priorities.

Health and well-being - The national indicator set will include indicators on health and well-being. 

Vulnerable people - LAAs will include more focused targets on improving the lives of the most vulnerable.  Vulnerable groups may be an area where there is a rolling programme of automatic inspection because protection can't be assured by bottom-up pressure or monitoring of indicators.

Children and young people - The national indicator set and Comprehensive Area Assessment proposals will apply.  In addition there may be time-limited output indicators for some specific change programmes (such as extended schools and children's centres).

Economic development, housing and planning - Multi-Area Agreements will be a voluntary agreement that will allow areas to co-operate on a sub-regional basis, and there will be work to develop the LAA framework to link with this.

Climate Change - The new performance framework will include a stronger focus on climate change, with national outcomes announced as part of the comprehensive spending review.

Links with Council Plan/Community Strategy

The performance section does not make specific reference to the Community Strategy, although by implication it will be the key mechanism for setting cross-cutting local goals. Our own Council Plan will need to dovetail into the Community Strategy very clearly in future, and there should be complementary priorities, actions and targets. Partnership Implications

Partnership working is a clear foundation of this discussion paper, and whilst there is little in the way of practical suggestions, we could usefully start now to look at opportunities for engaging partners (starting with the Local Strategic Partnership) in considering opportunities for integrated performance management, and exploring how joint outcome targets can be set and managed. This has already started with our involvement in the Local Area Agreement and the development of quality of life measures by the LSP.

We must also ensure that partnership working is productive and sustainable, and that accountability in partnerships is clear and robust. Again we have started this with the Partnership Audit, draft Strategy and good practice toolkit.

Action

There is an absence of practical detail at present, but the Council can usefully start to

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prepare to address the obvious implications identified above.

In addition as requested by Scrutiny Committee a workshop should be prepared for the meeting in January 2007 to explore the implications of the White Paper.

References: Sources:

ODPM / HM Treasury: Local Vision Document: Securing Better Outcomes – Developing a New Performance Management Framework

Department for Communities and Local Government

Contributors:

Policy and Partnerships Team

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