Announcement

Community budgets to be rolled out countrywide

Up to 120 thousand families facing real social challenges will see a significant improvement in services with the roll out of Community Budgets…

Up to 120 thousand families facing real social challenges will see a significant improvement in services with the roll out of Community Budgets across the country, the Deputy Prime Minister announced at the Local Government Association Conference today.

Putting community budgets at the heart of how we deliver services

Community Budgets for families with multiple problems will create better public services by bringing together all local priorities and public money so agencies can find the right solutions to issues in their area in a new and co-ordinated way.

The Deputy Prime Minister invited councils to sign up for Community Budgets. Around fifty more authorities will get Community Budgets this year and then at least a further sixty in 2012-13. This follows the success of sixteen pioneer areas that have put in place plans to support the first 10,000 families.

These families are less than one per cent of the population, but are seen by as many as 20 different public and voluntary sector professionals at a cost of £4billion a year. A Salford family required 250 interventions in one year including 58 police call-outs and five arrests; five 999 visits to Accident and Emergency; two injunctions; and a Council Tax arrears summons. Their Community Budget led to the £200,000 cost being cut by two thirds.

The Deputy Prime Minister also announced that four new Community Budgets pilots will be launched to explore how communities can have greater control over services through a single budget from Whitehall, as part the Government’s review into local government finances.

  • Two areas will be selected to help co-design neighbourhood level Community Budgets giving residents the opportunity to say what services they want, how they should work and whether they want to run them
  • Two areas will be selected to help co-design a Community Budget bringing all funding on local public services from the area into a single pot to test how to create the right local financial set up to deliver better services that people want.

A prospectus will be issued by the Department for Communities and Local Government at the end of the summer setting out the details for creating these single budget pilots.

The Deputy Prime Minister said:

Every Government preaches localism. This Government will practice it. In terms of real decentralisation, money talks. We need to reverse decades of centralisation to make our communities masters of their own economic destinies. We have to create the conditions for communities to invest in their own success. That means putting our money where our mouth is to give local authorities proper power over spending as well as more control over the taxes raised and keep so, for example, they can fight to attract businesses to come to their area.

We will also be putting community budgets at the heart of how we deliver services. There are families that have been let down by the system. Their complex problems mean they can end up seeing dozens of professionals across public services - but those professionals aren’t always joined up, making it near impossible for anyone to get an overall picture of what that family needs. Community budgets are budgeting for real life, breaking down the barriers between different parts of the machine, and treating people with troubles like human beings, not figures on a spreadsheet.

The Deputy Prime Minister also announced that the Department for Communities and Local Government will introduce a Local Government Finance Bill that will throw the Whitehall shackles off local government funding by giving councils the freedom to borrow against business rates, known as Tax Increment Financing, and to retain business rates.

The first phase of the Local Government Resource Review is considering options to enable councils to retain locally raised business rates. Real progress is being made and it is expected to report in the summer. A second phase set out today deals with Community Budgets.

Eric Pickles added:

It makes no sense that 120,000 families cost the country £4billion because inefficient public services are duplicating work. Community Budgets will radically change that by giving local councils and communities control over how public money spent in their area is used.

We are extending the reach of Community Budgets so that more local services across the country work in partnership to knock back the bureaucratic processes that box them into working alone.

Tim Loughton, Parliamentary Under-Secretary of State for Children said:

This is a once in a life time opportunity for the most disadvantaged families in society. We know that a key worker providing well coordinated no nonsense support helps spur families to overcome even the most complex problems, get their children learning and into school and parents into work. This new programme will mean over half of local authorities in England will get help to make these changes this year.

Notes to editors

  1. Community Budgets were announced as part of the Spending Review 2010 (see www.communities.gov.uk/news/newsroom/1748116) and the first 16 Community Budgets were launched by the 1st April (see www.communities.gov.uk/news/newsroom/1875618).

  2. Detail of the Local Government Resource Review Terms of Reference (phase two: Community Budgets) published today are available at: www.communities.gov.uk/documents/localgovernment/pdf/1933423.pdf.

  3. Detail of the Local Government Resource Review Terms of Reference (phase one: Business Rate retention) published on 17 March 2011 are available at: www.communities.gov.uk/documents/localgovernment/pdf/1913801.pdf.

  4. The Government will be writing out to all Councils shortly setting out more detail about the national roll out of Community Budgets for families with multiple problems and the pilots of radical options.

Each Community Budget area will be offered support from voluntary and private sector experts in redesigning local services and using new and more effective ways to help families as well as deliver savings in local service costs. Further details are available at: www.education.gov.uk/childrenandyoungpeople/families/multipleproblems .

  1. Around 40-50,000 families experience multiple social, economic and health as well as serious child problems whilst a larger group, possible around 70,000 (making around 120,000 families in total) are at a much greater risk of developing these problems. The needs of these families (and the problems they can caused others) can be so great that up to 20 different professionals costing up to £250-£350,000 can be involved in trying to help them. Last December the Prime Minister announced that his ambition was to try to turn around the lives of the most troubled families by the end of this Parliament.

  2. Nine centres or ‘Dissemination Hubs’ based within local authorities around the country will provide practical support to neighbouring areas in developing services for these families. Whitehall officials will be assigned to help areas ‘bust’ financial and legal barriers to achieving local ambitions by pooling budgets, changing working practices and investing in service reorganisation. Funding for local services for families will come from a wide range of local services all of whom stand to gain by reducing the demands many of these families make on their services. This includes Department for Education’s £2.2bn a year Early Intervention Grant and Department for Work and Pensions £200m a year European Social Funding announced this month.

Support for areas will focus on promoting successful local practice. Family Intervention Projects and services pioneered by local authorities have been shown to deliver significant improvements in family outcomes and savings in a wide range of service costs for a fraction of this amount within 12 months. Department for Education funding for over 30 local authority and voluntary sector projects will help to build this evidence and develop new ways of working.

For example in Islington the Council, the NHS, Job Centre Plus, Probation, Police, housing and the voluntary sector is pooling staff and over £6m of resources for their Community Budget plan. This will allow them to give intensive support to families facing particular problems in the area. Half of the children in this borough live in poverty and the vast majority live in a household where no one works.

A new Family Outreach Support Service will support a thousand families with persistent problems. They will also look to prevent 9000 unemployed families from falling into crisis. The professionals are joining up the dots to give families early, coordinated support reducing the number of people and places they get support from.

  1. The Department for Work & Pensions has also announced £200m of European Social Fund money over the next three years to help families with multiple problems overcome barriers to employment.

The European Social Fund is a European Union structural fund which aims to improve employment opportunities for workers in the internal market by complementing Member States’ jobs and training policies. The new programme will be delivered by private and voluntary sector organisations working with local authorities. The provision will operate on a payment by results basis, with providers rewarded for helping move members of the families they are working with closer to a point where they are ready to apply for work and get a job. The aim will then be to help individuals in those families get into work directly, or through mainstream support such as the Government’s new Work Programme.

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