Public service reform cannot happen unless historic under-funding is addressed
My colleague Glyn Davies MP touched on the proposed changes to public services in Wales in his last Politically Speaking column.
The Williams Commission, which was an independent, cross-party panel established and tasked by the First Minister to examine how Welsh public services can be improved and made more accountable to the people who use them. One of the key areas examined was how local government should be delivered in the future. The report recommended that the number of local authorities in Wales should be halved as part of "urgent and radical action" needed to protect public services.
The report’s impact for Mid Wales was a recommendation that the local authority and the local health board should be merged. This proposal was explored back in 2010 and the proposal does have obvious benefits, particularly the integration of health and social care. However, I do think there are a number of significant barriers which will make this merger challenging and the Welsh Government must provide viable solutions to overcome those barriers before it starts any merger process.
The obvious barriers will be issues around organisation capacity and democratic accountability. However, it’s the financial viability challenge that I believe will be one of the most difficult to overcome. Since this merger idea was last examined, the financial deficit of the local health board has worsened considerably, due primarily to Welsh Government cuts in investment. So what happens to that historic debt? Are Welsh Ministers prepared to write off those millions of pounds?
I also want to know what will happen to the wider funding formula for local government. I believe Powys is considerably underfunded compared to other local authorities in Wales. The challenge of delivering a range of public services over such a wide geographic area is an issue that I have raised constantly since I have been in Cardiff Bay, as I don’t feel the current formula properly takes that into account. This issue has further been exacerbated by derisory funding settlements over the last seven years, where Powys has year-on-year received the largest budget cut of any local authority in Wales.
The historic underfunding and dreadful settlements are really now biting as the authority tries to deal with a £20m deficit for the fourth coming financial year and I will show two clear examples of the difficult decisions it has been forced to consider.
The Council is giving serious consideration to prosed cuts to services provided by Powys Citizens Advice Bureau. There is no doubt that Powys CAB offers a whole range of unique services and expert advice to our communities which are beneficial and add considerable value. The Council provides CAB with just over £93,000 a year to deliver core services around its strategic objectives. Yet just this financial year alone, CAB has utilised that money to secured £2.2m of benefit payments for Powys residents; no doubt much of that money would have been fed back into the local economy. I think the Council must be extremely mindful of making significant cuts in this area because I feel such a move would have a far larger cost impact than the sum it’s trying to save and could potentially trigger a whole host of unintended consequences.
The second example is a proposal to change the way the Council provides education for children between the ages of 3 and 11 years with additional learning needs. The proposal suggests closing 18 specialised support units and four pre-school assessment centres based in primary schools around the county by next September. Again while I understand the Council’s financial position, I believe education provision must be a fundamental priority and I feel the disadvantages of this proposal far outweigh any proposed benefits.
These are just two examples of decisions the Council has been forced to make because of historic Welsh Government under-funding. Just as the Welsh Government has put forward the argument that it cannot take on income tax raising powers until the funding formula for Wales is reformed, I believe the same argument can be used by Powys not to proceed with any merger until the local government funding formula is properly reformed.
My colleague Glyn Davies MP touched on the proposed changes to public services in Wales in his last Politically Speaking column.
The Williams Commission was an independent panel, established by the First Minister to examine how Welsh public services can be improved and made more accountable to the people who use them. One of the key areas examined was how local government should be delivered in the future. The report recommended that the number of local authorities in Wales should be halved as part of "urgent and radical action" needed to protect public services.
The report’s impact for Mid Wales was a recommendation that Powys County Council merge with Powys Teaching Health Board. This idea was explored back in 2010 and the proposal does have obvious benefits, particularly the integration of health and social care. However, I do think there are a number of significant barriers and the Welsh Government needs to provide viable solutions before it starts any merger process.
The obvious barriers will be issues around organisation capacity and democratic accountability. However, it’s the financial viability challenge that I believe will be one of the most difficult to overcome. Since this merger idea was last examined, the financial deficit of the local health board has worsened considerably, due primarily to Welsh Government cuts in investment. So what happens to that historic debt? Are Welsh Ministers prepared to write off those millions of pounds?
In addition to this, Powys is considerably underfunded compared to other local authorities in Wales. The challenge of delivering a range of public services over such a wide geographic area is an issue that I have raised constantly since I have been Cardiff Bay, as I don’t feel the current formula properly takes that into account. This issue has further been exacerbated by derisory funding settlements – Powys has annually received the largest budget cut of any Welsh local authority for the past seven years.
The historic underfunding and dreadful settlements are now biting as the authority tries to deal with a £20m deficit for the forthcoming financial year. I will show two clear examples of the difficult decisions it has been forced to consider.
The Council is giving serious consideration to proposed cuts to services provided by Powys Citizens Advice Bureau. There is no doubt that Powys CAB offers a whole range of unique services and expert advice to our communities which are beneficial and add considerable value. The Council provides CAB with just over £93,000 a year to deliver core services around its strategic objectives. Yet in this financial year alone, CAB has utilised that money to secured £2.2m of benefit payments for Powys residents; no doubt much of that money would have been fed back into the local economy. Given the potential host of unintended consequences which could stem from a cut, I think the Council must be extremely mindful of making significant cuts in this area.
The second example is a proposal to change the way the Council provides education for children between the ages of 3 and 11 years with additional learning needs. The proposal suggests closing 18 specialised support units and four pre-school assessment centres based in primary schools by next September. Again, while I understand the Council’s financial position, I believe education provision is fundamental priority and the disadvantages of this proposal far outweigh any supposed benefits.
These are just two examples of decisions the Council has been forced to make because of historic Welsh Government under-funding. Just as the Welsh Government has put forward the argument that it cannot take on tax raising powers until the funding formula for Wales is reformed, I believe the same argument can be applied to Powys. We cannot proceed with any merger until the local government funding formula is properly reformed.