Spending Review will force children's services to rethink how they deliver
Ravi Chandiramani
Monday, August 31, 2015
In less than three months' time the government will publish its Spending Review, setting out department budgets for the four years from 2016/17 to 2019/20, with the impact on children's services likely to be profound.
The Chancellor of the Exchequer will publish the government's Spending Review on 25 November with the unequivocal aim of "repairing Britain's finances" to "eliminate the deficit by 2019/20". July's Budget confirmed £12bn is to be slashed from the welfare bill with a further £5bn saved by clamping down on tax avoidance, evasion and other irregularities. That leaves £20bn to find over the remaining four years of this parliament (see graph, opposite).
Government departments have been asked to model two scenarios of 25 per cent and 40 per cent savings by 2019/20, on top of similarly huge reductions over the previous five years.
In a Treasury document setting out its approach - called, incidentally, A Country that lives within its means -the Spending Review is described as an opportunity to "review the role of government". It states the government wants to prioritise spending according to innovation and greater collaboration in public services - citing the Troubled Families as an example of effective integration at local level - and radical devolution of powers to local areas in England.
The document states: "The government will continue to support this and similar cross-cutting initiatives that generate efficiencies and bring together public services at local level."
For children, it confirms it will protect schools funding on a per-pupil basis including pupil premium rates and that it will focus efforts to support school improvement in underperforming areas, including coastal areas. But everything else appears up for grabs.
In a separate but intriguing development, the Department for Education is awarding a rapid-turnaround research contract in anticipation of the Spending Review to examine local authority expenditure on children's services.
The DfE acknowledges the review is "likely to see reductions in local authority budgets, which in turn will put pressure on children's services budgets" in the expression of interest document for the contract.
It says it, together with the Department for Communities and Local Government and the Treasury, wants to "understand better how local authorities responded to funding pressures over the last parliament and their forecasts for changes in demand for and expenditure on children's services in the future".
This will involve visits to around 15 councils to investigate how efficiencies have been realised; any challenges and opportunities; how decisions are made on allocation of funding between different parts of children's services; how services are commissioned; how services are performance-managed; and how authorities collaborate (or not) to realise efficiencies. The findings are due in October.
Further cuts are likely to have huge ramifications for the way in which children's services are delivered over the next five years and beyond.
Maggie Atkinson from Impower and Enver Solomon from National Children's Bureau set out below what is at stake.
Government must speak with one voice for local collaboration to prosper
Maggie Atkinson, director, children's team, Impower
The Spending Review presents an opportunity both for government to shape the discourse, and for we outside the corridors of power to hold our political masters accountable for their well-worn rhetoric.
The Chancellor intends to find additional savings by further cuts to local public service budgets. Bringing departments together after the Spending Review to act on their stoutly shared pre-election commitment to safeguarding will be difficult. In the face of steep savings targets, departments will find it easier to become inward looking, and the Education Secretary will need to pre-empt this threat. She could do so by using the ministerial child protection taskforce, which she chairs for the Prime Minister, to establish the primacy of child safeguarding among her ministerial peers. If the government speaks with one voice on the issue across departments, the direct central expectation that localities will pool budgets, staff and other resources becomes that much more powerful.
As the Spending Review creates tension both within and between Whitehall departments, it will do so likewise in and between local authorities. Experience tells us that when budgets get tight, the last thing people willingly do is to collaborate, however clear the case for doing so.
The Spending Review will nevertheless likely build on the government's rhetoric, established over the last parliament, that better collaboration by public agencies is necessary to ensure better outcomes. If this collaboration does not happen on the ground, it would be a serious threat to economic and social improvement.
The 2004 Children Act, the 2014 Children and Families Act and the 2011 Education Act, all give the Education Secretary the mandate to insist localities, state-funded schools, government departments and regulators all work together by law. If they are not, she should use her powers to insist.
Finally, the challenges children's social workers are dealing with are growing in frequency and complexity. In many instances, people have not been trained to deal with the issues today's children and young people face. The explosion in technology and the interconnectedness of our world, raise both the spectre and reality of abuse in ways that were previously unthinkable. Such challenges mean local authorities need greater levels of intelligence and insight on their populations. The Spending Review creates an unhelpful tension for local authorities working in this space.
National pronouncements encourage people to see local public services as delivery arms for national policies and agendas. In some cases they do perform this function. But for children's services, particularly safeguarding, they are ever more heavily dependent on their own context, not on Whitehall. Room for innovation is needed. A Spending Review that forces everyone down one path will be unhelpful. Government needs to find a way - and it has shown itself open to this in the last five years - of creating room, and giving people leeway, to experiment. Regulators and inspectors need to see this as positive, not rogue, behaviour.
Spending reviews encourage departments and arms of the state to see themselves in isolation from others. This is my budget, these are my savings, and these are my programmes. This review, for better or worse, will force onto the table the issue of whole-system approaches to change. The economic reality continues to demand it.
Now is the time to revise expectations of the state's role for children in need
Enver Solomon, director of evidence and impact, National Children's Bureau
The next Spending Review could be a historic watershed in the development of children's services. The Chancellor has already signalled that government must "take a step back and think about the shape of the state". Doing more with less is his mantra.
It is important though not to forget two indisputable realities. First, children's services have already been doing more with less. A recent analysis by NCB, the Children's Society and CYP Now found the last government dramatically reduced money available to councils for vital prevention and early help services such as children's centres, youth facilities, advice services and family support. There was a 56 per cent cut from around £3.2bn a year in 2010/11, to just £1.4bn in 2015/16. But significantly, the analysis shows councils haven't simply followed through with these cuts. Where possible, they have tried to protect services through doing things differently and creatively, drawing on funds from elsewhere, such as the dedicated schools grant.
Second, demand is rising and its very nature is becoming more challenging. There has been a rise in initial contacts, referrals, children on protection plans and entering the care system in the three years up to March 2014. At the same time, services are having to work with children in more complex families, address the needs of new migrant communities and greater numbers of families moving into poverty.
So it is an extremely tough task for children's services directors to do even more for less through what the Chancellor describes as "careful management of public money". The Treasury's apparent solution is radical devolution and integration. The example held up is the regional collaboration across Greater Manchester, where 10 local authorities and a number of local health bodies have come together to form a strategic system-wide prevention and early intervention board that is pooling resources and co-ordinating activity. It is very early days for this approach, however, and it is not yet clear what savings can be achieved.
In the tender for its children's services expenditure research project, the DfE states "there is no simple correlation between high-quality outcomes and the amount spent per child by local authorities". But the relationship between expenditure and outcomes is complex. Unlike in the health service, where there has been much more analysis to understand inputs and outputs and value for money, there has been relatively little analysis in children's services. Before rushing to politically expedient conclusions, the evidence needs to be developed and better understood.
We need a greater consensus on what constitutes high-quality services and how success should be measured. The new single inspection framework under which, to date, one in five child protection services have been judged inadequate, has been condemned by directors as "broken and discredited". This needs to be resolved quickly.
The statutory framework set out in the 1989 Children Act can only be delivered with a good amount of resource. The funding available over the next five years will be insufficient. Devolution, integration and new ways of working will save some money but the current level of demand is not going to recede. Instead, it is time for all interested parties to put aside vested interests and ideologies and come together to rethink for which children in need the state should be intervening and what structures, systems and people are required. Royal Commissions are a thing of the past but something of that nature that is relevant for today is sorely needed.