What will local government look like in 2040?

  • From the impact of Brexit to the shrinking of Revenue Support Grants, there is no shortage of short-term challenges for local authorities to focus on
  • But what kind of challenges will councils be facing a generation from now, and how will they rise to them?
  • We recently hosted a local authority roundtable, which discussed many of the long-term challenges facing the public sector

Local authorities are in the midst of a period of dramatic transformation.

A decade of austerity and shrinking government grants has forced local authorities to consider new ways of working and new models of delivering services. In just a few years, central government funding will disappear altogether and councils will have to be entirely self-sufficient.

With so many short-term challenges to focus on, local authorities could be forgiven for not expending too much energy looking beyond the next few years. But as we discovered at our recent local authority roundtable, there is already a great deal of discussion about what kind of local government awaits the next generation.

The role of local government in 2040

The roundtable event, hosted at Zurich’s London offices, featured participants from local authorities across England and Scotland. The focus of the day was a recent report – published by the Social Market Foundation (SMF) and which we supported – entitled Local Public Services 2040.

The Deputy Director of the SMF, Nigel Keohane, who co-authored the report, began by explaining how it had sought to examine the trends that are likely to affect demand for local public services in the years ahead, and to explore the different models local authorities might adopt in order to deliver those services.

Demographic and social factors

The roundtable heard how a number of long-term demographic shifts are likely to affect the way public services are delivered. These include:

  • A significant expected increase in the proportion of the UK population that is aged over 75, which will increase pressure on health and social care services
  • A decline in levels of home ownership and a shrinking of the social rented sector, which could drive local authorities to play a more active role in the regulation of privately rented housing
  • Cities becoming even more densely populated, as older people choose to stay in urban areas to have better access to services and facilities, e.g. care and transport

There was also discussion about the uncertainty over future migration levels. One participant gave this blunt assessment: “Based on current population growth forecasts, the economy is going to die without a decent level of migration.”

Environmental factors

The roundtable heard how air pollution is a significant long-term challenge for many authorities, although there are huge regional variations. In London, for instance, more than 7% of local deaths are attributable to long-term exposure to air pollution, while the equivalent figure in Scotland and Northern Ireland is less than 4%.

Keohane summarized one of the key difficulties local authorities face. “The effects of environmental change are often felt locally, but political decisions that address environmental issues are often taken nationally,” he said.

The roundtable discussed how further regional devolution might give local authorities greater power to address environmental issues, for example by promoting green transport initiatives.

The role of technology

Technological advances have the potential to transform how certain public services are delivered – bringing potentially significant benefits but also challenges.

One area of particular focus during the roundtable was automation. In social care, for example, ‘carebots’ – robots that can perform certain care functions, such as dispensing medicine – could ease some of the pressure on social care services.

One roundtable attendee said: “A lot of the technology we need, like carebots, already exists. There is a lot of opposition to it but we need to be braver as a sector, because of the benefits it could bring.”

There was also a broader discussion about the potential impact of automation on employment, and about the steps local authorities might need to take to re-skill their populations.

The future of local government

Local Public Services 2040 presents five possible models for how local authorities might operate in 2040, with each model having the potential to overlap with any of the others.

They are:

  • Industrial councils – authorities focused on addressing market failures and assuming new responsibilities
  • Ofcouncils – authorities that look to achieve objectives through greater regulation, including areas such as housing
  • Tech opportunists – councils eager to make the most of automation and data analytics in order to change behaviour
  • Commissioning councils – authorities that look to work closely with the local market, including voluntary sector providers and crowd-funding initiatives
  • Community councils – authorities that look to support community networks and build community resilience to respond to floods or other external incidents.

Attendees agreed that whatever model of public service delivery local authorities choose to adopt in the years ahead, the sector needs to do more to attract a new generation of leaders to drive this change.

This crucial challenge will be one of the issues to be discussed at the Solace Summit 2017, which takes place from 1-3 November.