CHAPTER 2
Why consulting over finance is hard but not impossibleWe recognise that consulting the public is difficult and that consulting the public over budget issues is especially difficult. To quote from Sutton’s 2001 review of ten years experience:
The focus tends to be on the reduction options and this gives a negative aura to one of the council’s major consultation exercises… A lot of responses are saying ‘don’t cut us’ rather than giving more impartial views… The timescales are short due to the constraints of the budget process.[5]
Even a council with a history of undertaking consultation struggles with the difficulties of consulting over the budget. Local finance is a complex area. A point that the cartoon on this page has some fun with. Every council we visited during our research made comment about the difficulties involved in consulting over budget matters. It is these questions that make the challenge of consultation over budget-setting distinctive and justify these guidelines. In this chapter we note some of the common expressions of doubt that we have heard and identify how they can be addressed.
Table 2.1: Cartoon PEOPLE ‘DON’T KNOW ENOUGH’
There are some very real concerns about whether the public can understand the technicalities and the choices around budget-setting. Will people understand the difference between the funding demands of upper and lower tier authorities? Will they recognise the difficulties of gearing? Will they be able to understand how to balance the demands of different services? Will the not so popular ‘Cinderella’ services lose out more often? Will people make a knee-jerk reaction to cut local taxes and not think through the implications in terms of its impact on services?
Information at the right level and communicated effectively is the key to effective consultation in budget making even more so than in other areas. That is why these guidelines devote Chapter 4 to communication and provide advice on how to avoid jargon. The technicalities of budget making, if we are honest, throw some councillors and officers into confusion. Little wonder that members of the public occasionally get confused as well.
It is essential to build some element of deliberation into your consultation techniques over budget making in order to give scope for more informed and reflective consideration of the issues. It is necessary to provide information to people in a form they can digest and discuss in a reflective way the choices that they face over the budget. Decisions need to be informed with as clear an idea as possible about the consequences of different decisions. Chapter 5 provides an outline approach to good practice in this area.
But in the end the key point is that the consultation process is not about the technicalities it is rather about making choices. Do you give this service or that initiative priority? Do you want more money spent to achieve collective ends or for individual choices. These choices are not easy but there is no reason to think that the public should be judged any less able to make them than others. As we will see in Chapter 6, it not necessarily true that people will always in a referendum choose the lowest tax option. On the contrary, people appear to make a reasoned judgement on the basis of the evidence presented to them.
The responsibility of the local authority is to consult on what they consider to be workable options for their budget and the package of services that go along with them. It is not to hand over decisions to the public without proper forethought. The public therefore are not required to become experts on local finance but instead given the opportunity of making choices within a framework informed by the political and technical judgement of their local authority.
THE TIMING AND LACK OF PROPER INFORMATION MAKES CONSULTATION VERY DIFFICULT
This presents some real challenges. The essence of the problem is that to consult earlier in the budget cycle gives people a greater chance to influence a range of priorities but less certain information about the level of resources that are going to be available to the council. As a result, a lot of either overly optimistic or overly pessimistic scenarios may enter public debate. If discussion is delayed then information about what is the budget position becomes clearer, but the scope for choice is more constrained both in terms of the time available and the range of options that can seriously be considered.
There is no doubting the difficulties associated with consulting on council tax. But in Chapter 3 we propose two ways of at least beginning to address these difficulties. One approach might be to consider your consultation in two stages:
firstly, a wide set of discussions about priorities for different services;
secondly, determine the overall size of the spending cake by making a trade-off between the need for additional local resources and taxpayers’ willingness to pay.
Another approach would be a more long-term response to the issue but one urged on local authorities by the 2001 White Paper, namely a move to better year round financial management systems.
OUR STRUCTURES CREATE A RECIPE FOR PUBLIC CONFUSION WHEN IT COMES TO CONSULTATION ABOUT BUDGETS
In our conversations with local government representatives, three important issues were raised:
The different tax raising and service responsibilities of councils in multi-tier areas are not well understood by the public and as a result consultation about a particular council’s budget is less meaningful.
In all local areas an authority is likely to be responsible for only part of the bill faced by the council taxpayer. There will also be precepts set by other elected local authorities there may be precepts from parishes, police authorities, the Environmental Agency, etc. that will affect taxpayers bills, but which are not the prime responsibility of the local authority that is leading the consultation exercise.
There is some uncertainty within local authorities about who should be leading on consultation. Should it be those councillors that are in the executive role or those who are involved in the overview and scrutiny function?
The response to these points, developed in Chapter 3, is that clarity about roles is essential. There is no easy way to overcome issues of overlap given the complexity of our governance arrangements, but it is possible to develop complementary roles for councils at various territorial levels and for councillors performing different functions within a council. Indeed, there may be positive advantages in developing a system that has built into it an automatic system of checks and balances.
ALL THAT HAPPENS WHEN WE CONSULT IS THAT THE ‘USUAL SUSPECTS’ SHOUT LOUDLY FOR MORE RESOURCES FOR THEIR SERVICE OR AREA
There is a danger that consultation exercises can play into the hands of special interests and lead to special pleading that distorts rather than enhances local democracy.
Consulting the views of the same groups or people on a regular basis, may present another problem. It is important to avoid causing ‘consultation fatigue’ – people may become disinterested in consultation if they feel they are being bombarded by surveys seeking their views, especially if they feel the views they provide are not ‘making a difference’.
Table 2.2: A selection of feedback comments on a budget consultation Here people reflect their own experience and concerns in relation to council tax and budget-setting. Sometimes they are thinking of themselves, sometimes they are thinking of others.
“Pay particular attention to administration costs, e.g. The Scout Association receives grants from Kirklees Metropolitan District Council (KMDC) towards the cost of training leaders. This is administered by the authority in many small awards throughout the year.”
“Why do councils have to charge inflation rates at three times the national rate? OAPs & people on low incomes have their rises wiped out immediately by this system.”
“As an area, Kirklees needs to consider whether four-year-olds in schools are being funded appropriately. There needs to be a considerably better ratio of adults to children in reception classes 1:30 is not acceptable.”
“I would like to know more about asset management”
“Increased support for voluntary organisations, particularly for older people.”
“I feel that certain areas of Kirklees are treated better than others. I pay full council tax and we feel we should get our fair share and we don’t!”
“Has any of the £12.1 million (Highways) been allocated to do work on the pavements in our area? Huddersfield Rd (Liversedge) pavements are an utter disgrace!!!”
“Social Services provision to young people/teenagers seems stretched due to the amount of work coming in around young children & child protection, due to budgets and rapid staff turnover, from the perspective of a voluntary agency. Are there any plans to address this?”
“I am unable to attend as we have a boxing tournament that night. I would like to discuss how we can occupy young people – we have 250 members but can’t open enough for them. If there were grants available I would open full time and we could cater for a lot more giving them somewhere to go and something to do off the street.”
“As a lecturer at HTC, it breaks my heart to see the sub-standard level of service we have to give to our students such as classes on lower numbers being closed down year after year because there simply isn’t enough funding to sustain them, when such vast amounts of money are being pumped into schools.”
“Since many of our society members own telescopes and are very keen Deep Sky Observers who support the Dark Sky Campaign. Are street lamps with covers (which reflect the light onto the pavements and road, and prevent excess light escaping into the sky and creating light pollution) being installed in the new housing developments within Kirklees?”
Source: A selection of comments and questions made on questionnaires and at meetings during Kirklees’ Budget Consultation, Autumn 2001
It is important to follow a strategy of mixing together a range of consultation techniques (including techniques that do not rely on a large degree of self-selection by participants) in order to ensure that a range of public opinion is tested. This will help prevent results being distorted by a few vocal people or groups. Beyond this point it should be clear that the decision on budget matters ultimately rests with councillors – consultation should inform their judgement not determine it. In Chapter 7 we explore the issue of how to sift through consultation responses and come to a judgement.
THE CULTURE FOR THIS LEVEL OF INTENSE CONSULTATION OVER BUDGETS IS JUST NOT PRESENT EITHER AMONG THE LOCAL AUTHORITIES OR THE PUBLIC
Some argue that consultation is just too difficult and demanding and that finance officials lack experience in undertaking consultation in general. A further challenge is presented by the fact that the public is generally unfamiliar with the local government finance system and how the budget is set. If the public is brought into the process in small groups, its response can be manipulated – although this is a risk with large-scale approaches as well. The problem with alternative large scale, but relatively ill-informed tests of public opinion, is that people can give you an ‘off the top of the head’ reaction or just ignore the process all together. A low turnout in the case of large-scale approaches, raises questions about the representative quality of the results. It is also worth noting that it may not always be easy to interpret results.
The response to these difficulties, which is developed throughout the rest of the document is: don’t try to run before you can walk, develop a strategy, do training, learn the skills and give the public time to come on board. We recognise that many of the dilemmas are real. There is tension between informing people and being seen to bias their opinion. There is tension between having an in-depth dialogue and involving as wide a group as possible. This document offers you workable ways of addressing some these dilemmas in the light of local circumstances.
[5] London Borough of Sutton, Review of Consultation Arrangements, Report of the Acting chief Finance Officer, 10 September, 2001
Published 4 July 2002
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