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Neighbourhood services: truly the politics of place

Source: PSE Jun/Jul 2017

Paul O’Brien, chief executive of the Association for Public Service Excellence (APSE), explores the impact of austerity on neighbourhood services, and warns of the consequences of this continuing downward trajectory in funding which risks falling to a 60-year low.

In 2016, APSE published a groundbreaking report exploring the context of local government finance beyond the narrative of social care. As an organisation which supports the delivery of excellence in local government frontline services, we were concerned that all too often these ‘frontline’ services were simply not part of the political discourse. Back then our research found that local government finance was in a parlous state, right across the board, and yet the focus of the media remained narrowly pointed at the funding of social care. A key finding of the report was that current spending by UK local government was below the levels seen in 1979, and that by 2020 the combined current and capital spending would reach levels lower than any point since 1948 – an unprecedented drop in funding to local council services. 

Alarmed by the findings of our first report, APSE, the New Policy Institute  and economist Dr Peter Kenway began researching the specific impact of funding on services outside of the social care funding ‘bubble’. These services, which we term ‘neighbourhood services’, include those delivered on a daily basis by local councils, like refuse and recycling collections, street sweeping, parks and public realm, roads maintenance, leisure centres, and protective regulatory services like food safety and environmental health. 

Confirming the worst fears 

We analysed the specific impact of budget changes on these services. This looked at the total service expenditure over four groups of services, which included the broad headings of ‘highways and transport’, ‘cultural and related’, ‘environmental and regulatory’ and ‘planning and development’. Our findings were as stark, showing that whilst UK central government current expenditure has held up, local council budgets have had an ever-decreasing share – it seems that austerity has been applied to local councils in a way not seen in terms of central government expenditure. A good illustration of this is looking at the ratio between central and local government expenditure: in 2010-11, for every £100 spent by central government, local government spend was £67. By 2018-19, that local government spend will drop to just £50 for every £100 spent centrally. As a share of the economy, local government has also faced a steep decline and by 2021-22 will represent just 5.7% of GDP – a 60-year low. 

Unsurprisingly, the research confirmed the worst of our fears. Neighbourhood services have faced the brunt of local government funding cuts, equating to some £3.1bn up to 2016. In some areas, this has translated to cuts of up to 40% with, on average, services suffering reductions of around 20%. 

We have also identified a crucial issue of fairness: amongst the most deprived neighbourhoods spending fell 22%, but in the least deprived this was just 5%. These differentials are difficult to comprehend since all political parties have supported, or indeed adopted, policies to place resources in the areas of greatest need, such as the way in which pupil premium funding was designed to provide additional monies for the most disadvantaged pupils. If we accept the need to balance limited resources to counter disadvantages in our communities, should this not also be the premise for fairer funding in our neighbourhood services? Instead, we saw a reduction of £3.1bn, or 13%, on neighbourhood services between 2010-11 and 2015-16, while spending on social care rose £2.2bn. 

We are not suggesting that social care funding is not in crisis. Clearly, with the rise in demand, it is only right that funding for social care should be fairly addressed. However, we would argue that there is equally a need to reflect on the long-term damage to communities if we fail to recognise the value of neighbourhood services and the contribution that these make to our communities and their wellbeing.

High-quality public realm and public parks can make a positive contribution to both physical and mental health. The way our local roads and highways are managed has a direct impact on attracting and retaining local businesses, providing local infrastructure critical to economic development. Leisure services are increasingly regarded as wellbeing services, with many councils using the assets of leisure facilities to tackle obesity, but also to address isolation and loneliness amongst older people. Regulatory services keep communities and businesses safe, from taxi licensing to food safety. The list of positive benefits from neighbourhood services is endless. Decision-makers and governments across the UK administrations need to recognise the value of these services. 

We are rapidly reaching a tipping point where the future viability of these services is called into question, something which would have disastrous consequences for local people and local economies. It is time to challenge the new orthodoxy that councils can innovate their way out of these deep cuts. Councils have already proven time and again that they are both innovative and agile in responding to budget pressures, but now there is a genuine concern, evidenced by our detailed financial analysis, that we are no longer simply arguing for a fairer share of the funding pie – the funding pie is simply not big enough. 

We must now accept that social care and neighbourhood services both need to be funded fairly and we should not have to choose to fund much-needed social care at the expense of the very services that make our neighbourhoods tick.


Dr Peter Kenway was the lead author of the ‘Redefining neighbourhoods: a future beyond austerity?’ report. It can be accessed at:



John Mortimer   22/06/2017 at 22:39

I dont want this comment to sound insulting, it is meant to be honest. For many people out there, austerity has had a very negative impact for a long time. They did not need a data driven analysis to find this out. I have worked, like you, improving the public sector for many years. It takes one day with the front line to conclude what you have found. Previous policies have decimated services driving hard working staff to the point of complete disillusionment. And demand has risen because of the functionalisation of the health and social care system. Rising demand is just a polite term for a system failing to achieve its most basic aims, causing those in need to bang on multiple doors multiple times.

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