Performance anxiety

I love local government, and I’m really looking forward to attending the LGA conference this week in Bournemouth – catching up with old friends and colleagues, meeting new people and learning what’s new.

I’ll particularly be looking out for signs of life in the debate on sector performance. Since first launching the IMPOWER INDEX – our benchmarking tool which grades councils on productivity, meaning outcomes per pound spent – back in 2017, we have been working hard to deepen our perspective on performance. We have met with hundreds of people – directors and chiefs in local government as well as officials from the LGA, MHCLG and DfE, and sector influencers such the IFS, the NLGN and CIPFA and used the INDEX to discuss productivity and what ‘good’ looks like for local government. Apart from the fact that people are really enthusiastic about what we’re trying to do in this space, we have also learned that:

1. Knowing what ‘good’ looks like is inherently difficult in the public sector. Everyone has an opinion; very few people have any reliable data.
2. You risk creating the wrong behaviour anytime you set up any kind of public performance regime chasing numbers rather than addressing underlying issues.
3. Nobody has enough of an incentive to try hard to overcome these challenges.

This is a huge problem for the sector, because – make no mistake about it – there are huge opportunities for improvement still waiting to be seized. While these remain untapped, the outcomes for vulnerable people are worse – and spending higher than they need to be. For councils who want to seize the available opportunities, knowing where they are currently and where they are aiming for is fundamental.

Despite the fact that continuing to drive improvement is clearly in everyone’s best interests, this remains a tricky space. Why? The bottom line is that none of the key players have a clear incentive:

1. Central government has an interest in local government performance but only really from the point of view of saving money. They laser in on questions of spending variation – but only because they’d like to inform their spending review.
2. The LGA is a member-led representative body and therefore has a conflict of interest in terms of calling out poor performance; it is also in lobbying mode, asking for more money, so anything that makes this message more complicated isn’t welcome.
3. The NAO might be interested but can only act under instruction from Parliament – and only over money that is spent by Parliament. In addition, they do not have a performance management role.
4. CIPFA has an interest in financial resilience – but a fierce response from councils at the bottom of the list on financial resilience has shown what happens when you report on a narrow-framed view of performance.

The sector needs to own its own performance – it can and should do better overall; and more importantly those authorities who are doing brilliantly need to be properly celebrated by the sector.

If you’re going to be in Bournemouth and have a view on any of this, do get in touch.