The fourth meeting of the Northamptonshire Improvement Board was held at One, Angel Square, Northampton on 6 March, 2019.
The meeting reviewed a number of the key challenges which are being tackled by the County Council focusing in particular on its financial position, the council's services for adults, the developing workforce strategy; and preparations for local government reorganisation within Northamptonshire.
The board received a presentation spanning the three financial years 2017/18 - 2019/20. The audit of the 2017/18 accounts is understood to be close to completion and the County Council is now in discussions concerning a number of recommendations arising from the auditor's work. At the same time the financial position in 2018/19 has continued to improve.
Latest budget monitoring information forecasts a possible deficit of approximately £1m compared to £11m reported to the board's previous meeting. With further improvement over the remaining weeks of the year there is a good prospect that a balanced outturn position will be achieved which will be a significant achievement. Additionally, the council's budget for 2019/20 has been approved following a robust, well managed process including a public consultation and detailed budget scrutiny review by the council's overview and scrutiny committee. The latter process had been significantly strengthened from the previous year following the implementation of changes recommended by the Centre for Public Scrutiny who had carried out a review funded by the LGA.
The board noted that the position has improved considerably following the announcement by Government of a capitalisation dispensation of up to £70m in response to a submission made by the commissioners. The dispensation will enable the council to fund its anticipated deficit in 2017/18, as well as a small deficit in 2018/19 if one arises, and establish a more robust reserves position to support the 2019/20 budget. The dispensation itself is being funded by the use of the council's own capital receipts.
In terms of spending per head of population Northamptonshire is a relatively low spender on adult services compared to other county councils. In contrast it is a relatively high spender on children's services. Board members explored whether the council was seeking to rebalance investment in the two service areas and, if that was the aim, whether sufficient progress was being made. The board noted that the budget process for 2019/20 had focused on ensuring that all services were appropriately resourced to deliver the council's offer. In the case of children's services the council clearly needed to provide appropriate funding to address the various weaknesses and areas of concern highlighted by OFSTED in its recent inspection.
In overall terms the Board was encouraged that the County Council's financial position has improved significantly and that its budget and plans for 2019/20 appear to be robust and realistic.
Services for Adults
The Board received a presentation on the council's services for adults which in particular highlighted:
- the Council's core statutory duties
- its strategic areas of focus and risk
- the key challenges relating to the possible transition to a new unitary structure
Adult services throughout the country are facing significant challenges. Northamptonshire is working to address a variety of pressure points including meeting increasing demand; recruiting and retaining appropriately skilled staff; working effectively with partner agencies, especially in health and police, to integrate services where appropriate; improving and streamlining business systems and processes; and helping to develop care markets which offer diversity and quality in provision of services.
The detailed service data shared with the board, including a range of key performance measures, suggests that the county council is managing current challenges and risks competently and that in overall terms performance is generally good.
The board noted that the additional risks and pressures associated with a likely local government reorganisation are considerable for adult services. One of the critical factors will be the attitude of staff to the expected changes. The County Council is hopeful that decisions about the reorganisation, including its timing, will be made as soon as possible and that they will provide welcome clarity and a sense of certainty for staff in relation to their futures.
Another key issue concerns the organisational arrangements for adult services post reorganisation. Options include transitioning to two smaller departments embedded within each of the proposed unitary councils, or retaining a county-wide function, perhaps in the form of a trust.
Whilst recognising that the benefits and risks of different options need to be thoroughly explored, the board urged that decisions should be taken as soon as possible to provide clarity and focus for planning.
The board welcomed the presentation and, whilst encouraged by the progress and grip around current priorities and work programmes, noted the huge challenges associated with reorganisation, the potentially short timetable for their resolution, and the need to put in place and resource appropriate planning and preparations.
The board received an update presentation in relation to the development of the council's workforce strategy. The board had previously discussed this work at its November meeting. A potential County Council 'People Deal' has been developed focusing on the respective responsibilities and commitments of the County County and its staff. Pay awards and incremental pay progression are contentious questions at the heart of this work. The 2019/20 budget does not include provision for a pay award. However, if the financial position improves, the affordability of some form of pay reward for staff will be reviewed.
The board was especially interested in the council's arrangements for communicating with and receiving feedback from its staff. Staff morale and retention are clearly critically important issues in relation to the council's ability to provide good services and manage its affairs successfully. The board welcomed a number of relevant initiatives which were aimed at ensuring that the council leadership is accessible to staff. However, the board also noted the current absence of plans to survey the opinions of all staff in the period ahead of the expected reorganisation. The board felt that this was a surprising omission given the high levels of concern which potentially arise for staff as a result of relentless media reporting of the county's difficulties and the high level of uncertainty surrounding local government reorganisation.
The board also discussed the importance of work to shape the desired culture of new unitary councils. As well as stressing the importance of this work as part of the framework for any new authorities - and noting that the need to change culture was one of the key drivers underpinning the recommendations of the Caller report - the board emphasised its view that this work needed to be developed cooperatively with district and borough councils. The current change programme in relation to the expected reorganisation includes an HR and workforce work stream which appears to be focused on transactional rather than strategic milestones. The board considered there should be greater priority attached to the work, with partners, on culture in the expected new unitary organisations.
Local Government Reorganisation
The board was updated on the progress of preparatory work in relation to the transition to two unitary councils which remains subject to a decision by the Secretary of State .
A detailed change programme has been developed involving a series of different work streams and three key phases:
- Phase 1 focusing on creation of the new authority
- Phase 2 focusing on delivering 'safe and legal' arrangements on 1 April 2020
- Phase 3 focusing on transformation and future state preparation
The board acknowledged the sheer scale of the programme required to ensure a smooth transition. It was sceptical about the current risk rating of more than 60 programme milestones in which the highest rating is currently amber. The board was concerned about the realism of the assessment of current progress against the plan and the absence of clarity concerning the likely costs of the reorganisation.
The challenge of resourcing and driving forward the programme is significant for the county and for district and borough councils. The board recognised that there is a significant risk that the efforts to deliver a positive reorganisation outcome will impact on work to continue to drive the County Council's recovery. Managing the tensions and competing demands of the two parallel programmes will be vitally important.
The next meeting of the Improvement Board will take place on 9 May, 2019.