As more and more public bodies declare bankruptcy there are difficult decisions ahead about budget cuts and how they translate into service continuity.

Getting finances “back on track” is one such theme of this timely budget discussion in Birmingham .  Despite being clearly labelled as “non statutory”, we can’t help feeling there is a legitimate expectation for any council in the same position to be doing this.  Actually, some might argue that there is a statutory duty under the best value duty in relation to the commissioning cycle, including when considering the decommissioning of services  (perhaps it is no coincidence that this duty is also having a revamp).

Neatly, the Birmingham consultation does focus on the priorities and preferences of local citizens – a sensible precursor to a more difficult consultation about best compromises.  Better still, budget consultations are an opportunity for improving economic literacy and helping citizens be more accepting of council tax charges.

While participatory budget simulation has been popular in years gone by, it’s no longer clear how sensible compromises can solve such wicked issues. Instead, annual budget conversations are going to need to be more factual, honest and informative.  So, what are the additional research questions?  Take a look at this preliminary list: –

  • What are the options for income generation?
  • What should we protect? Discretionary versus statutory.
  • Should free services now carry charges?
  • Is there an opportunity for asset transfer?
  • What are our anti-poverty principles?

Thankfully, there are some excellent examples of video narratives emerging to help explain the fiscal predicament, such as this one from Cotswold District Council featuring Cllr Mike Evemy ( . Understanding impact is so important – so it’s important to be real and use real numbers.

In our experience, what tends to go wrong with these sorts of consultation is the following: –

  1. Poorly communicated financial impacts
  2. Poorly communicated impacts on staff and staffing
  3. Cost benefits of options not calculated
  4. Short term thinking (not long-term thinking)
  5. Unrealistic savings identified (e.g. the sale of buildings)
  6. No consideration for green impact
  7. No consultation on spending decisions or investments

 By the way, that last point is very contentious as it has actually accelerated the collapse of some councils!

Trouble is, there is a conundrum about consulting on the shape versus the substance of budget decisions with regards the rigidity of any resulting decisions and the extent to which impact appraisals are conducted.  In other words, there will be occasions when the profile of a budget has not yet translated into firm changes and that those changes require secondary consultation.  As a precaution, practitioners are well advised to bring forward fresh consultations on specific issues where significant impacts are now signaled and to keep the substance of proposals at budget setting time less specific!