New ways of governing: Boroughs GLA & London Councils London Policy Officers Network Dick Sorabji 27 June 2008

The challenge of governing the global city Governing in the 21 st century Todays agenda is not enough The challenge for London local government Developing new forms of governance From efficiency to innovation Our role in 21 st century governance

The status quo is not viable Rising expectations –People want more than basic service Erosion of citizen engagement –Distrust of national politics Delivery needs are changing: –Co-production –Multi-agency working –Collective decision-making Localities are more varied Boundaries are more complex The challenge for Britain is to replace a 19 th century model of national governance with one that can handle the complexity & uncertainty of the 21 st century

Cross-cutting challenges: Child poverty Youth aspiration & employment Worklessness & aspiration Enabling independent living Crime & fear of crime Affordable housing Economic growth for all Populations Flows in a Global city Public space & civic life Global city: low carbon footprint Rewarding success Trust & engagement with local politics London delivery challenges demand new ways of governing

National view of the local public service transformation agenda Motivation The efficiency agenda Public finances Peoples expectations Policy challenges IT opportunities Action National Improvement & Efficiency Strategy –3% efficiency –Innovative capacity –Community empowerment –Economic leadership Local Area Agreements Whitehall sees the big picture through a glass darkly

Local government efficiency Gershon efficiencies –Local government: £4.5b December 2006 –London councils 2008: £20m per month Source of savings Procurement Back office functions Transactional services Increased productive working time Management of policy, funding & regulation CSR 2007: 3% savings Local government is already the pre-eminent public service

21 st century demands on delivery Organisational listening Neighbourhood flexibility Strategic scrutiny Leadership & mobilisation Shared service management Partnership building Multi agency accountability Pro-active economic development Market development Performance management Financial management Risk management The race for skills will decide who owns the devolution agenda Closer to citizens Delivery through networks Managing uncertainty

Traditional local government: Hierarchies and contracts Council Executive Children Environment Social Services PCT Private Contractor 3 rd Sector Contractor

Emerging local government: Hubs and networks LA 3 rd Public LA Exec LA 3 rd Private Public children elders economy safety

City Charter: purpose Memorandum of Understanding: –Working towards a City Charter for London Principles: –Devolve as far a possible –Respect tiers of London government –Respect diversity – of communities & places –Continuously improve –Transparent & open –Value scrutiny (Assembly & boroughs) –Clear accountability in complex system Describing success

City Charter: action 1.Congress 2.Mayor & Leader borough visits 3.Delivery Board for London 4.Continuous improvement –Using Capital Ambition 5.Collaboration pledges 6.Full City Charter at first Congress 7.Congress to revise and add to Charter over time Locking in new ways of governing

From efficiency to innovation Efficiency savings More tasks per hour Bulk purchase savings Invasive control systems More ticket machines Process improvements Eliminate tasks Different purchases Automatic control systems Oyster Card Thinking differently delivers more than squeezing harder

Three areas of innovation Delivery chains –Process improvement –Citizen driven Networks –Common values –Common outcome targets Relational markets –Tailored incentives –Market platforms

Delivery through networks Understanding others business models –Resources are the gateway to alliances Bringing common values to surface –Iceberg analysis Communication across all levels –Deals involve more than the CE Co-ordination not control –Holding the ring: not playing the game Education as influence –Speaking all professional languages Become the network hub Strengthen the network Reviving the vocation of public service

Common first steps in process improvement Customer focus is efficiency focus Processes often designed for a structure that was replaced long ago –Between departments –Within departments IT provides management controls that do not obstruct delivery Front line staff usually know how a process could be improved –The hard part is getting them to tell you Middle managers have the hardest time

A process model of local government Private Contract 3 rd Sector Private Contract Citizen (internal customers) Local Authority

Relational markets User demands –Individual budgets Market development –Porters Five Forces Rivalry Supplier power Buyer power Threat of substitutes Barriers to entry

New governance: brought to life through delivery Devolution ensures delivery Empowerment of individuals & communities: –Happens locally Creating opportunity & aspiration: –Best designed bottom up Risk transfer: o London has the talent to accept the risk From innovation to outcomes: Londons message to Whitehall