The Chamberlain News

Reinventing the wheel: all you need to know about Birmingham council’s green paper service reviews

There are plenty of differing views about how best to deal with Birmingham City Council’s financial crisis. But one thing everyone can agree upon is that the scale of the public spending squeeze facing Europe’s largest local authority is unprecedented.

Between 2010 and 2017, the council’s controllable budget will have been slashed by half as a direct result of the Chancellor’s austerity programme. During the same period, the demand for expensive adult social services from an ageing population will continue to grow. Clearly, something has to give.

Some £275 million has been cut from council budgets in the past two years. A further £550 million will disappear by 2017-18. The core non-schools workforce at Birmingham’s largest employer has plunged from a peak of about 26,000 to little more than 15,000, and is set to fall even further.

Labour council leader Sir Albert Bore dubbed this “the end of local government as we have known it”. Working himself up even further, Cllr Bore added that we had Armageddon to look forward to. He followed that up by insisting that the council would have to “reinvent local government” from the ashes of what remains as we move into the 2020s.

A series of green papers set out proposals for re-shaping services. Sir Albert insisted that these discussion papers must avoid the traditional “salami slicing” approach to cutting spending, since the sums to be found were so vast that simply lopping a set percentage off each departmental budget would put all services at risk.

A graph depicting the financial squeeze, dubbed the Jaws of Doom, started off in early 2013 forecasting a £625 million shortfall between income and expenditure. That figure has risen to £825 million as the Chancellor’s grant-cutting intent ions become clearer, although it is fair to say that some Labour councillors accuse Sir Albert of grossly exaggerating the problem.

The green papers will be distilled into a single white paper setting out a proposed council budget for next year, and laying the groundwork for significant reorganisation of services. The white paper is to be presented to the council Labour group for approval on November 30 and will then go out to public consultation.

Sir Albert has warned many times that some of the services the council provides will have to be “decommissioned” or handed over to the private and voluntary sectors.  Early versions of green papers didn’t go far enough, according to the council leader, and would not have delivered the required savings. They had to be re-written.

Whether decommissioning actually happens is certain to be the subject of bitter debate among Labour councillors, as is Sir Albert’s insistence that devolved district committees must take responsibility for deciding which services to pull the plug on.

Readers must judge for themselves just how radical the green papers really are, the extent to which they avoid the salami slicing culture of local government and the opportunities they present for dramatically re-shaping public services.

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Safe, Clean and Green Neighbourhoods

This green paper begins with a reminder that council services are being challenged to “develop bold and innovative responses to the financial situation, while recognising that the level of loss of government support makes a reduction in overall service levels inevitable”.

In a section dealing with street cleaning and recycling, it is made clear that some or all of these services could be contracted out to the private sector.

“The council will either provide the services directly or commission them in the most effective and cost efficient manner possible.”

The Fleet and Waste Management section offers obvious opportunities for private sector involvement in the following areas:

– Domestic refuse collection

– Domestic recycling collection

– Trade waste and recycling collection

– Waste disposal

– Street cleansing

– Public conveniences

The council currently provides a weekly bagged refuse collection service and fortnightly collections of recyclable material and green waste.  Recycling in the city is static at 32 per cent and Birmingham is under pressure both financially and politically from the government to increase this figure.

The service is being changed to a wheeled bin collection of domestic waste and a paid for green garden waste service charging £35 a year from next year to cover direct costs.

The council can get income from paper recycling and more recycling and could expand capacity at the Tyesley waste plant which could be sold off.

The council has a long-term contract with Veolia ES (Birmingham) Limited to deliver a range of waste management services.  The contract commenced in 1994 and expires in January 2019 and delivers the following services:

– Treatment and disposal of residual waste – mainly through the operation and maintenance of the Tyseley Energy from Waste facility with some landfill disposal of wastes over and above its capacity.

– Marketing of the electricity generated at Tyseley.

– Operation and maintenance of the council’s five Household Recycling Centres at Perry Barr, Lifford Lane, Tyseley, Castle Bromwich and Norris Way.

– Operation and maintenance of the council’s transfer stations located at Lifford Lane, Perry Barr and Tyseley, including receipt of waste collected by the council and its bulking and onwards transportation to a relevant treatment/processing facility.

– Composting of green waste, processing and marketing of collected recyclable materials, management of street sweepings.

As the contract expires in January 2019 the council will need to make new arrangements for the provision of these services, which is likely to offer a substantial opportunity for the private sector. The service has developed a full business case proposing changes (including a recycling incentive scheme) which is being considered outside of the service review process.

Much attention is being paid to the future of domestic refuse collection services in Birmingham. By accepting Government funding of £29.8 million, the council has undertaken to continue with weekly collections 2017. Pressure to save money by following the example of some other towns and cities by switching to fortnightly collections of residual household waste after 2017 will be intense.

As part of the Government funding bid, the council committed to market test the domestic refuse collection service at the end of December 2015.  The financial position of the council is such that the timetable is likely to be brought forward.

Similarly, the council’s service for collecting trade waste may be outsourced.

Support Services

The future operation of civic catering and building cleaning services is in doubt, with a debate underway about whether the council should still be involved in such areas. Consideration is being given to transferring catering and cleaning to Acivico – a stand-alone company created by the council to trade with the private sector.

However, the success of Acivico is far from guaranteed and it is possible that the council will eventually be forced to privatise its catering and building cleaning services, along with the security and reception services in council office buildings.

The sale of advertising on the council website is likely to be sanctioned, raising an estimated £70,000 a year.

Service Birmingham

The £1 billion contract with Service Birmingham (Capita) is under intense political scrutiny. Essentially, the council is paying Capita about £120 million a year to run ICT. It is possible the city’s Labour party leadership may decide to cancel the deal if significant cost savings cannot be negotiated and hand responsibility for running the call centre and ICT services to a local company or companies.

A Resilient City

This green paper deals with a wide range of services including traffic management and regulation, licensing, off street parking enforcement, trading standards, environmental health, bereavement services and planning administration.

The review does not recommend contracting out at this stage, but says these services should aim to become self-financing. Failure to become self-financing would almost certainly result in disposal to the private sector in future.

A significant proposal is to amalgamate the coroner’s service, licensing and environmental health in a purpose-built medico/legal centre on the Queen Elizabeth Hospital or Heartlands Hospital site. This would enable the council to sell a valuable portion of land in the city centre, close to the magistrates’ court, currently occupied by the coroner.

Developers are to be charged an administration fee deposit when they submit a planning application, which they will forfeit if the application is withdrawn before reaching the planning committee.

Additional income will be raised by extending on-street parking zones beyond the city centre boundary, in particular at Eastside and Digbeth.

Developing Successful and Inclusive Communities

Dealing with the heart of Birmingham’s community services, this green paper focuses on a wide range of council-run functions including libraries, local advice offices, youth services, car parks, parks and grounds maintenance and housing, covering total budgets of £183 million.

The document urges the “deconstruction of traditional service delivery patterns” and paves the way for a more important role to be played by the voluntary sector in running a variety of services including local libraries, parks and the youth service. Volunteers are likely to be sought to run libraries in wealthier parts of Birmingham dubbed “non-priority literacy areas” by the council (see also Standing up for Birmingham campaign).

The green paper challenges the council to stop delivering services in a “paternalistic way” and to switch to “delivering with” the help of local communities. The document states: “This is a significant change from the traditional role played by council services and will for some communities be a difficult transition. It is, however, a reality that the council and its citizens will have to come to terms with and step up to co-delivering.”

One proposal is for the council to work with private sector employers who are already running corporate social responsibility programmes. The green paper notes: “The reality of the council’s situation is that we will be expecting individuals and groups to play a larger part in delivering services that the council cannot afford to fund.”

The likelihood of community asset transfers where buildings are declared surplus to requirements – community libraries and community centres are most likely – is raised.

The prospect of a ‘sale of the century’ approach to the council’s huge real estate portfolio is raised. The local authority owns 4,000 buildings and 5,000 individual sites with an estimated value of almost £5 billion. The annual cost of maintaining the assets is £70 million.

Many of the buildings are vacant, under-utilised or in a poor state of repair. District committees are being urged to dispose of all unwanted buildings, thereby raising capital sums and saving on maintenance and running costs.

A scaled down youth service is expected to result in many more young people being “signposted” by the council to local cricket and football clubs as well as organisations like the scouts and cubs.

Some of Birmingham’s suburban car parks will be sold for development if the land has “significant market value”.

Business Improvement Districts will be urged to help maintain parks by sponsoring floral displays.

Adult Social Care

Substantial savings of up to £80 million are planned over the next three years – equivalent to more than 20 per cent of the total budget.

It’s proposed that about 1,000 adults with learning disabilities should be moved out of expensive residential care and helped to live independently in the community. The green paper does not specify how this is to be achieved, but it is reasonable to assume that the voluntary sector will be expected to play a significant role.

Paradoxically, although the council by implication expects volunteers to do much more, it is also planning to cut by £8 million the budget for commissioning services from the third sector. The green paper accepts that this is likely to result in more individuals presenting with “substantial or critical needs” at a later stage, at additional long-term cost to the public purse.

Moves to cut £12.8 million from the Supporting People budget will hit adults with learning disabilities and mental health issues, the council admits. The green paper proposal is to cease long term support services around finding accommodation for at-risk groups. Short term support services around domestic violence refuges and hostels for homeless people would remain intact.

Council-run campaigns raising awareness about obesity and smoking are likely to be scaled back or scrapped entirely, as is the Be Active project which entitles all Birmingham residents to free gym sessions.

Absolutely key to the future for adult social services is the pooling from 2015 of NHS funding in Birmingham and council social care funding – a pot totalling £600 million. Health and Wellbeing Boards will play a crucial role in deciding how this money should be spent and eradicating the duplication of services.

Safeguarding, Supporting and Educating Young People

Children’s social services, currently under government special measures after being declared inadequate by Ofsted, will be spared any direct cash cuts – the only council department to have its budget protected.

The council spends £93 million a year on providing non-statutory education services. These include children’s centres, home to school transport, Connexions, early years’ childcare and business support.

The green paper proposes “working with schools to identify the way in which resources currently spent across all of care and education services can be used differently”. In reality this means persuading schools through their representative body the Schools Council to assume responsibility for funding and providing some or all of these services themselves. The council hopes to save £11 million in this way.

Standing up for Birmingham Community Engagement Campaign

Immediately dubbed Albert’s Citizens’ Army, this is one of council leader Sir Albert Bore’s big ideas. Put simply, the council will invite volunteers and the third sector to take responsibility for running a wide range of non-statutory services. These could include community libraries, parks, sports centres, community centres and street cleaning.

The green paper notes: “We must all stand up and make our contribution to getting us through this crisis, and the strongest need to do their bit to protect the weakest from the impact of these cuts.

“There is a wealth of existing community activity in Birmingham which we will be celebrating and a lot of pent-up enthusiasm in our communities.

“Our message to community and voluntary groups is that we welcome your proposals to take over services and assets or contribute more to running them and we welcome any initiatives or proposals that can make a greater contribution to helping us through this crisis.”

Some people have described this as the Big Society in action. Others take the view that it smacks of desperation.

Cover Image:  ‘Victoria Square’