Young people at risk of offending in Gateshead and South Tyneside will be at the centre of a radical experiment in improving the way government funds are spent on public services. The focus will be on the needs of places and the people who live there rather than delivering the programmes of Whitehall departments.
Gateshead and South Tyneside form one of five places to pilot the Place Based Budgets approach, alongside Liverpool City Region (focusing on special educational needs and disabilities), South Yorkshire (adults facing multiple disadvantage in Doncaster), West Midlands (adolescent mental health across Dudley, Sandwell, Wolverhampton and Walsall) and West Yorkshire (preventing youth unemployment).
Place Based Budgets is not about spending more money but ensuring that existing resources are pooled and deployed in a collaborative way that best meets the needs of users rather than government departments that work separately to achieve their own objectives.
Regional mayors such as Kim McGuinness in the North East will lead implementation, bringing in local councils and other partners.
Testing the ambition
Guidance issued by the Ministry of Housing Communities and Local Government (MHCLG) explains Place Based Budgets like this: “The programme tests whether local partners, working through mayoral strategic authorities, can pool budgets, align governance and redesign services around specific cohorts to deliver better outcomes for the people who rely on them.
“It is a response to a problem that has persisted for too long. Public services have been organised around the departments that fund them rather than the people who use them. Funding flows through separate systems with different rules, and the result is duplication, late intervention, and people falling through the gaps.
“This is not a new diagnosis. Fifteen years ago, Total Place began to test a different approach across 13 pilot areas covering 63 local authorities, mapping around £82bn in local public spending and showing that redesigning services around the user, rather than institutional boundaries, can produce better preventative outcomes for less public money. That work was cut short in 2010, before the proposition could be tested in practice.
“This government is now building on those foundations with greater ambition. Mayoral strategic authorities, which did not exist in 2009, provide the convening power and strategic reach that place-based reform requires. Place Based Budgets are the test of whether that ambition can be made to work in practice.”
Each pilot area will have a project board responsible for local delivery, there will be a programme delivery board responsible for oversight and integration; and a steering group including senior representatives of the MHCLG and Cabinet Office will be responsible for strategic leadership and accountability.
Work has already started in the pilot areas and all should be delivering by next April and will run until 2029, when they will be evaluated to see if Placed Based Budgets should be scaled up.
The rationale
The MHCLG guidance reiterates: “Public services face deep structural pressures. Demand is rising, responsibilities are split across organisations, and funding flows through separate systems with different rules, incentives and accountabilities, even when serving the same people. The result can be fragmented support, late intervention and duplication that makes it harder to deliver the joined-up services that people need.
“Place Based Budgets are a deliberate response to this, building on over two decades of thinking and practice around place-based reform, including Total Place and similar initiatives. Rather than adding new funding or redesigning services from the centre, five pilots will explore how giving local systems greater flexibility to pool budgets, align governance and redesign services around a defined cohort or challenge can improve outcomes. The focus is on testing the hypothesis that collaboration, culture and services improve when incentives and accountability are better aligned.”
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