Small is Beautiful – Innovation in Local Government

I would like to begin by thanking NESTA for supporting this publication and for putting on this impressive launch event today. In particular, thanks to Michael Harris, Madeleine Hallward, Laura Bunt and Lucie Osborn for supporting this project and enabling it to come to fruition. I would also like to thank all the local authorities that submitted projects for our consideration and the ten projects featured in this publication who gave their time and effort. We genuinely could not have written this publication without their advice and support.

The Small is Beautiful project began in July 2009 as a collaboration between the LGiU, LACORS, the National Association for Local Councils and the Museums, Libraries and Archives Council. Our objective was to identify projects working in local authorities that had small budgets, relatively few staff and were undertaking an innovative project that delivered real and verifiable benefits to the community, providing a new service to the community or an existing one with a twist. We sent out a call for information to our combined membership lists. We were not sure what we would get back. Suddenly I was being called from around the country by random people eager to know what small is beautiful was and quite reasonably… if there was money involved.

The response was overwhelming. We had almost two hundred submissions in total. These were submitted by a variety of local authorities including District, County and Metropolitan councils from all corners of Britain. The services that submitted projects were equally varied. They included environmental services, registration services, heritage projects, archives, libraries, museums and sports based projects.

We were particularly interested in submissions from discretionary services. Local Government services can be divided into two. There are statutory services, where Local Government is told what to provide and often how to provide it. Discretionary services, which local authorities provide out of choice. Our theory was that the latter afforded more opportunities for innovation. Local authorities determined what to deliver and how. There was little central guidance so there was more potential for people to be creative.

Some projects were weird and wacky. Others lacked imagination and could not be described as innovative. I won’t name those respondents who submitted their entire local plans in the hope we would shower them in glory. They are not represented among the projects featured in this publication. However, there were many projects that showed real creativity and drive. Ten of these projects are featured in this publication. I will now briefly describe each of the projects so you get a flavour of those featured.

  • Blackburn Museum Service runs a programme called ‘We also Served.’ This promotes social cohesion by highlighting the service of south Asian men in the British Indian army in World War Two. Working with an Asian youth group and two local schools they have produced a DVD. This features interviews with both the veterans and local Asian and white children. It combats the BNP message by highlighting the service of non white veterans. It combats the Islamist anti British message by highlighting how Asian veterans volunteered to serve Britain. 
  • Broadland provides a model for local authorities to tackle anti-social behaviour with it’s’ ‘Stairway out of Crime Project.’ In 2003 children’s facilities were vandalised in one of the Wards in this low crime area. The District commissioned the University of East Anglia to identify why individuals committed anti social acts. They recommended the council provide an early intervention programme. This the council did by developing a fund to finance projects on a short term basis with a view to making them commercial operations. 
  • Derbyshire Cultural and Community Services have shown how public spaces can be used to increase the numbers viewing its exhibit ‘The Derbyshire Police Collection – Delivering the Community Safety Message.’ In 2004 Derbyshire dispensed with the 2,000 items in its police collection. The Museum worked with 46 public libraries and the police to develop small touring collections to increase the numbers viewing the collection. These collections were based on police information campaigns. They are now seen by the same number of people in a week that previously saw it in a year.
  • Devon Record Office has developed a project called ‘Sensory Box, Trade and Empire, Britain and India during the 1800s. This sought to make the exhibits accessible to those with no sight. It worked in partnership with the West of England School. Relevant items from the archives were identified and reproduced so the children could smell bags of goods such as spices that were traded, feel a ships log written in brail and smell the parchment that ships maps were produced on.
  • East Riding Registration and Celebratory Services delivers a programme called ‘Citizenship in Schools.’ This promotes a shared sense of British identity among school children through organising mock ceremonies in schools. Each child acts out the part of either a dignitary or a new citizen.
  • Lancashire County Library and Information Service have extended their service provision to a new audience by utilising the library for community events. It’s ‘Get it Loud in Libraries’ Programme holds concerts and comedy nights within its premises. Library employee’s research, select and book music and comedy acts. Acts such as Florence and the Machine, Bat For Lashes, Adele, The Blackout and Ellie Goulding have performed in libraries under this scheme. 3800 new members have visited Lancashire libraries under this scheme.
  • Middlesbrough has turned dangerous public spaces that were becoming a focus for arson into pleasant community-maintained areas through it’s ‘Back Alley Improvement Team.’ These back alleys as immortalised in Coronation Street can become a focus for arson, when mattresses and chairs are abandoned. Offenders and local citizens were recruited to clear the space and provide new plants, artwork and in some cases lighting. Arson has dropped dramatically in those areas where the scheme operates.
  • Warrington and Halton Trading Standards have a ‘Consumer Alert Network.’ They developed this as a cheap means of contacting vulnerable groups to warn them of consumer scams. Placing adverts in the paper did not provide the necessary real time updates. Manually phoning twenty or thirty community representatives failed to get the message out. By developing an automated service residents could easily be given information about incidents, advice on how to protect oneself and a contact facility for further advice. This has reduced the number of people falling victim to scams before con artists are caught.
  • Winchester Museum Services project ‘Using new technology to engage with customers’ was a pioneer in harnessing new social media technology to change the way its staff work. 360 degree virtual tours were produced to improve pre-visit information for those with disabilities, due to fears they may be deterred from visiting by not knowing what physical obstacles they would face at the museum on arrival. Members of staff also trained to record podcasts on exhibitions, providing interest for those with visual impairments.
  • Rochford District Council have pioneered a programme called ‘Shop at my Local.’ provided a forum for local small businesses to compete with major companies on price, customer service and convenience. Following this presentation, Laurie will discuss this project in greater detail.

So innovation clearly existsin Local Government but it takes place in pockets.  We need to answer the following questions:

  • What are the barriers to innovation in local government?
  • What unique features did these projects have that enabled them to innovate?
  • How can we nurture innovation in local government and enable worthwhile projects such as these survive in an era of public spending cuts?

I will deal with each of them in turn:

What are the barriers to innovation?

There are three: Funding, incentives and culture.

Funding: The discretionary spend of local authorities is limited and uncertain. I would like to be able to give you a precise figure. However, during our extensive research no such figure could be derived. The rough estimate was between ten and fifteen per cent of the budget of a county council over which the authority had some level of discretion. What we do know is that funding for innovation is limited. Most private companies have a research and development budget devoted to innovation. In contrast local government resources devoted to this end are often fragmented, temporary and difficult to locate. Many projects reported that they needed to gain funding from multiple organisations for different aims and different timescales.

Incentives: Many of the drivers of private sector innovation were absent from the public sphere. County Councils do not go bankrupt if they fail to innovate and update their service provision. The extent to which local authorities compete to provide public services in their area is limited. Individuals rarely get a financial bonus if they improve delivery. The majority of individuals are on contracts that reward tenure and compliance with established procedure. There are fewer opportunities for rapid career progression but until recently greater job security.

Culture: Is it procedural? Many projects reported they were stifled or controlled by officials dealing with a series of issues including data security, financial probity, equal opportunities and open competitive procurement. Innovation was seen to detract from their core work responsibilities. There was a divide in some authorities between those who innovated i.e. senior managers and those who were subject to redesign or innovation i.e. junior employees. This is entirely understandable. Local authorities operate under the glare of organisations such as the TaxPayers’ Alliance. They need to account for every penny spent. It is thereby better to proceed in a conventional and hidebound manner than risk being unique and thereby a target.

So, what unique features did these projects have that enabled them to innovate? How did they break the mould?

They interacted with external audiences to obtain three things: funding, ideas and skills. They were flexible enough to adapt in response to these stimuli. They were supported by their leadership, who knew they were taking a risk and were prepared to do so.

External stimulus: They emerged in response to an external stimulus. Something new had happened to the authority. There was no established procedure. They could devise a solution from scratch. In Blackburn, Muslim veterans came forward requesting recognition. In Broadland, a youth facility was vandalised and the District council decided to look at why people were prone to anti social behaviour.

In keeping with the age of austerity all these projects operated on small budgets. Eighty per cent of them operated on less than fifty thousand pounds per annum. They were forced to continually interact with external audiences including private funders, third sector providers and to recruit private volunteers. They had to justify their existence. We talk about a sunset clause on Government agencies and legislation. That after a series of years their function and existence will be reviewed. These projects needed to demonstrate their worth everyday. If not they would not be funded.

Adaptation: They sought customer feedback; case studies, comment cards, questionnaires, web tracking, consultations and public events. These exercises were not just to tick a box. They influenced the end product. East Riding altered its presentations to make them more interactive after comments by teaching staff. Rochford changed its advertising materials to cater for different businesses. Blackburn diversified the children highlighted in their productions to make them more relevant to different audiences. The projects knew their customer base and sought to tailor their product to the user’s specifications.

Culture: Some of these projects could have failed. This would have resulted in public criticism. If these projects were not successful it could have damaged the relevant managers’ careers. Managers were prepared to risk this. Supportive leadership was often a personal quality of particular managers. Few organisations had structures in place to promote it. Our model seeks to rectify this.

How can we nurture innovation in local government? How can worthwhile projects such as these survive in an era of public spending cuts?

Local authorities could allocate their discretionary expenditure or a proportion of it to create an innovation fund. Some may want to be radical and assign all the discretionary spend. Others may seek to allocate a proportion. They can increase the funding as necessary. Each fund could dispense loans capped at a specific level (for example £50,000) for a limited period (for example a maximum of three years) to projects which meet specified criteria. The fund could be augmented by donations from local philanthropists, businesses and successful council grant applications to charitable or government bodies. Applicants for awards would need to evidence at their creation how the project could become a commercial entity and repay the loan with interest or achieve cost savings to the council in excess of the award they are given. The cost savings made to the council or a proportion of them should be paid back into the innovation fund. They would be assessed after a specified period set out in the original loan agreement e.g. three years. If they had not achieved either a return on capital or cost savings then all council support should be cut.

The Board that would award the loans should include senior members of the council such as the Leader and the Chief Executive. Bureaucratic support could be seconded from the pensions department of the council or contracted from private providers. The projects would mainly be staffed by council employees. This would require a council to allow its staff to be seconded to run these projects for a period of time. Councils will need to consider if they want to bill the social enterprise for the time, reduce employees pay pro rata or gift the time to further support the project. Councils already manage such arrangements in cases of maternity leave and sickness. Many authorities already assign some employees specific leave days to do charity work.

What are the possible threats?

I will end by outlining some of the threats this model may be subject to. The Government bureaucracy at both central and local level has a habit of killing off such schemes. I think people should resist the following:

  •  Providing insufficient start up capital to allow the fund to achieve genuine change. It could become a token fund for pet projects.
  • Extending the criteria for loan distribution to include multiple different factors. This will sap the creative impulse. If you have two hundred priorities then you have no priorities.
  • Make withdrawals from the fund or use it to fund projects which have no hope of achieving a rate of return or cost savings to the council.
  • Poor financial management – Apply a prohibitive interest rate in projects bidding to become social enterprises. This would deter people from taking the necessary risk. Or apply so low an interest rate that the fund is not replenished and becomes loss making.
  • Allowing middle management to refuse to allow staff the necessary leave to pursue these projects or making this scheme a dumping ground for staff the authority is unwilling to fire.

There are potential threats but there are also opportunities.  Our model will allow local authorities to finance innovation. It has the potential to nurture the creative impulse of local authorities. Councils looking to make forty per cent cuts in their budgets may wish to adopt it.