The case for community budgeting is growing

Recently the deputy prime minister announced that the government is going to extend community budgets to right across the country – and is encouraging local authorities to apply to participate.

This is without question good news.

While the current community budgeting pilots, focused on helping vulnerable and challenging families, have only been ongoing for a few months, there is a precedence of a similar initiative.

Under the previous government a scheme, known then as Total Place, was devised with a number of pilots introduced, mainly looking at unemployment. While ultimately this process was not taken seriously by the Treasury at the time, it did identify some interesting ways of operating and indeed some surprising statistics.

For instance, the Leicestershire pilot noted that there was a 20% loss of revenue through bureaucracy at each and every stage in which money was passed down by central government. This figure indicates some serious systemic problems with the UK’s heavily centralised system of governance.

There is a clear commitment from the coalition to localism and decentralisation, and along with upcoming proposals to reform local government finance, community budgeting is arguably one of the most powerful mechanisms of doing so.

The premise is simple – currently a vast number of organisations in an area spend their money trying to tackle a similar issue – such as vulnerable families – with duplication and waste being inevitable consequences. Through community budgeting, these organisations will pool their budgets into one pot, creating a more effective, efficient, streamlined and focused approach to the issue in hand.

However, as I mentioned above, the approach does bring with it implications for the Treasury – and indeed to the Whitehall machine itself.

However, the economic argument in favour of extending community budgeting is growing by the day. In Salford for instance, a family had cost an annual sum in the region of £200,000 – due to a stream of police callouts, visits to A&E, injunctions and a court summons. This cost was slashed by two-thirds as a result of community budgeting.

The social argument is also compelling – not only will community budgeting allow the majority of funding to be targeted at the frontline, but in the case of vulnerable families – gives them one direct point of contact for all of their problems.

Furthermore, the policy has had measurable successes. In Swindon, for instance, their approach – working with 12 families over a period of time – led to children going to school more regularly, police callouts reduced and adults getting back into work.

Tim Loughton, the children’s minister, described the plans as ‘a once in a life time opportunity for the most disadvantaged families in society’.

Now that the political will exists to spread nationally community budgeting for vulnerable families – the question is – what area of policy next – and arguably there is a strong case for social care, early intervention, offender management and youth services.

The deputy prime minister also announced that four new community budget pilots are being developed, with the local authorities and policy areas yet to be determined.

I will be pushing for a community budget pilot to be developed in the Black Country where there maybe opportunities for such an approach with regards to housing, adult social care, mental health and youth services.

These pilots offer a great opportunity for local authorities and other local organisations to grab the bull by the horns and I hope that many will take up the challenge.


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Phil Teece
Phil Teece
12 years ago

I agree that there is a great deal of merit in looking at service spending from a multi-agency perspective. However, community budgeting, as with its Total Place predecesor, is missing a vital ingredient; the direct involvement of the users in prioritising how the money should be allocated. Such a participative approach, adopted with regard to care services in councils such as Norfolk and Newcastle, adds an extra dimension to the benefits; community ownership, transparency, shared responsibility and a sense of empowerment on the part of the service users.

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