Local Government Modernization and the Views of Chief Financial Officers

Since its election in May 1997, the Labour Government in the United Kingdom has emphasized the need for modernization in the improvement of public services. For local government, this emphasis has led to the introduction of a variety of measures intended, primarily, to improve political management and service delivery. Two key policies have been the introduction of Best Value and the Comprehensive Performance Assessment (CPA). CPA is used by the Audit Commission for measuring local authority performance in England and has led to each authority being classified as excellent, good, fair, weak or poor. Each authority's classification has implications, financially and in terms of its freedom to determine priorities and policies. In addition, the structure of local government is being reviewed by central government, alongside discussions as to the merits of establishing regional assemblies. In considering the justification for, and the impact of, changes, it is important to consider the views of local government employees, not least professional groupings and chief officers. This paper reports the findings of a national survey of chief financial officers (CFOs) of the single tier and county council local authorities in England to establish their views on key features of the Government's modernization agenda.     

Competition and Contracting in the Transition from CCT to Best Value: Towards a More Reflexive Regulation?

Following publication of the government’s proposals for a statutory framework of Best Value, and the introduction of regulations increasing the flexibility of CCT pending its abolition, this paper examines the relationship between the compulsory regime and its likely successor. First, the paper suggests that the Best Value frame-work is likely to impose a range of regulatory, monitoring and enforcement constraints similar in effect to the formal requirements that operate under CCT. Continuity with Conservative policy will be reinforced practically through transitional arrangements for the gradual abolition of CCT and the phased introduction of its replacement. Second, the paper argues that contracting is likely to continue to have a significant role under the new regime as the natural adjunct to the voluntary competitive processes that will be the preferred management tools for securing improvements in service performance. Open tendering and public-private sector partnership arrangements, both of which imply contractual governance, are given explicit priority in the consultation document over benchmarking, performance indicators and other comparative public management mechanisms. Third, the paper argues that local authorities are likely to want to retain and develop contracting arrangements that potentially permit a degree of control over service provision that might not be available were more radical service-providing alternatives to be adopted, involving the complete transfer of functions outside the public sector and/or their vesting in independent companies. Finally, the paper assesses the transition from CCT to Best Value from the theoretical perspective of responsive and reflexive regulation. Following a brief account of the reflexive failures of CCT, the paper argues that, although the Best Value framework is characterized by inherently reflexive processes involving self-review, consultation and standard-setting, its relative success is likely to depend ultimately both on the tightness with which legislation is drafted and on the manner of its practical interpretation, implementation and enforcement.     

Comprehensive Performance Assessment and Public Services Improvement in England? A Case Study of the Benefits Administration Service in Local Government

The purpose of this paper is to independently evaluate the impact of the Comprehensive Performance Assessment regime on one particular public service, namely the provision of council tax and housing benefits distributed by local authorities throughout the course of the regime. This service was assessed in every iteration of the CPA methodologies and it included one of the few key performance indicators (KPIs) where the definition of the performance indicator, the means of collection and the public reporting of its results, remained the same throughout the CPA period between 2002 and 2008.

The findings show that there were considerable and consistent improvements in benefits administration nationally within England and across all of its regions. The paper then investigates a series of propositions. Whether there was any significant variations in the performance of larger as opposed to smaller authorities, or between predominantly rural authority areas and urban authorities or between authorities with different party political control. Finding no significant differences the research suggests implementation of the CPA regime itself appears to have had a catalytic effect upon the performance of the benefit administration services within local authorities throughout this period. The paper therefore concludes with a brief discussion as to whether the findings support the theoretical position of proponents of neo-institutionalism isomorphism or more traditional rational actor theories of public choice.     

Performance Management, Evaluation and Learning in 'Modern' Local Government

Public sector reforms throughout OECD member states are producing a new model of 'public governance' embodying a more modest role for the state and a strong emphasis on performance management. In the UK, the development of performance management in the context of the 'new public management' has been primarily 'top-down' with a dominant concern for enhancing control and 'upwards account-ability' rather than promoting learning and improvement. The development of performance management and evaluation in local government in the UK has been conditioned by external pressures, especially reforms imposed by central government, which have encouraged an 'instrumental–managerial' focus on performance measurement. The new Labour government's programme of 'modernizing local government' places considerable emphasis on performance review and evaluation as a driver of continuous improvement in promoting Best Value. However, recent research has indicated that the capacity for evaluation in local government is uneven and many obstacles to evaluation exist in organizational cultures. Local authorities need to go beyond the development of review systems and processes to ensure that the capacity for evaluation and learning is embedded as an attribute of 'culture' in order to achieve the purpose of Best Value.     

Performance Management,Evaluation and Learning in ‘Modern’ Local Government

Public sector reforms throughout OECD member states are producing a new model of ‘public governance’ embodying a more modest role for the state and a strong emphasis on performance management. In the UK, the development of performance management in the context of the ‘new public management’ has been primarily ‘top‐down’ with a dominant concern for enhancing control and ‘upwards account‐ability’ rather than promoting learning and improvement. The development of performance management and evaluation in local government in the UK has been conditioned by external pressures, especially reforms imposed by central government, which have encouraged an ‘instrumental–managerial’ focus on performance measurement. The new Labour government's programme of ‘modernizing local government’ places considerable emphasis on performance review and evaluation as a driver of continuous improvement in promoting Best Value. However, recent research has indicated that the capacity for evaluation in local government is uneven and many obstacles to evaluation exist in organizational cultures. Local authorities need to go beyond the development of review systems and processes to ensure that the capacity for evaluation and learning is embedded as an attribute of ‘culture’ in order to achieve the purpose of Best Value.     

Politicians,organisations and the public ‐ the provision of gypsy sites

Under the Best Value regime, the government requires local authorities to involve the public in determining the provision of services. Indeed, the Best Value legislation provides a legal basis for consulting citizens and the local community in relation to better management of local government functions. The guidance on Best Value also encourages local authorities to place performance management within a community strategy framework. These combined actions will, it is hoped, result in more innovative, effective and efficient provision. Arguably, however, the success of increased participation will be influenced by how and why the public are involved. This study draws on case study research to ask whether involving the public does result in innovative changes and to what extent those involved are empowered through the process, concluding that success for both the authority and service users is influenced by factors such as cost structures and whether the original intent includes careful consideration of how those involved might benefit from the process.     

An Inquiry into Balanced Scorecards within Best Value Implementation in UK Local Government

The aim is of this paper is to conduct an exploratory study into the use of Balanced Scorecards as an approach to implementing Best Value in UK local government. Furthermore, a participant-observation method is used to study the development into a Balanced Scorecard within local government.
There is a need to critically evaluate approaches to implementing Best Value so that local government can determine how to achieve the service performance levels laid down in the framework. There is a paucity of systematic studies exploring and critiquing the effectiveness of using the Balanced Scorecard in Best Value implementation. The paper describes an exploratory multiple case research study followed by longitudinal participant-observer research on Balanced Scorecard development in a Best Value context. The findings show that the Balanced Scorecard can play a key role in Best Value implementation. Moreover it is also useful in linking other improvement initiatives. However, the Balanced Scorecard process must be informed by organizational and environmental information that is both accurate and adequate. The audit functions of the Business Excellence Model go some way to providing this information.     

Plans, performance information and accountability: the case of Best Value

The current UK government emphasizes the importance of mechanisms of accountability that involve the planning and public reporting of performance. One example of this is the Best Value performance plan. However, there has been little evaluation of the quality of the information provided in this type of document. This paper draws on literature on stakeholding and user needs to identify the data required for accountability. It then assesses whether the plans produced by Best Value pilot authorities in Wales provide appropriate information. The analysis shows that very few of the plans contained the relevant material. Interviews in the pilot authorities highlighted two key reasons for the poor level of data: a lack of performance indicators prior to Best Value and limited staff expertise in performance measurement. The evidence suggests that documents such as performance plans currently make little contribution to the accountability of public organizations.     

Matching supply and demand in local public services,part 1 — Preliminaries; productivity and quality control

The local government 'modernisation agenda' has important implications for research in local government, a function which has been neglected in recent years. This article argues that modernisation, especially Best Value, requires authorities to develop as 'intelligent learning organisations' and to build the capacity for research to support processes of learning and improvement. Based on the findings of recent research, the article discusses lessons for local government in enhancing research capacity and utilisation, referring both to internal factors and to the potential for collaborative arrangements. It is concluded that central government might do more to assist the development of such capacity but ultimately authorities' approach to research must be developed to support achievement of their defined purpose, role and objectives.     

Best Value and the Market Orientation of UK Recreation Centres

This paper explores the similarities between the Best Value initiative and the well-established market orientation construct. It shows that many of the benefits that Best Value could bring to local authority recreation centres could have been achieved more easily by implementing the market orientation philosophy. A study of 67 recreation centres suggests that although market orientation will increase under Best Value, the benefits from this might be somewhat illusory and represent poor value for the administrative and operational burdens entailed.     

Evaluating performance indicators: Current trends in local government

This article summarises research into a small number of local authorities on the use of performance indicators, carried out for the Local Government Management Board (LGMB) and the Policy and Performance Review Network (PPRN) in 1997, and concludes that home‐grown indicators developed in response to Best Value will overcome some of the inadequacies of the Audit Commission approach.     

COMPULSORY COMPETITIVE TENDERING FOR LOCAL GOVERNMENT SERVICES: THE EXPERIENCES OF LOCAL AUTHORITIES IN THE NORTH OF ENGLAND 1988-1992

This article examines the response of a sample of local authorities in the North of England to the introduction of Compulsory Competitive Tendering (Cm) following the 1988 Local Government Act. It analyses the Organizational implications of CCT and highlights how officers, councillors and trade union representatives viewed the changing nature of management within local authorities in the period following the award of the first service contracts. In particular, it examines the different reactions to the development of a more commercial approach to the management of services and ends by assessing the specific impact of CCT in the context of other important changes in local government.     

The Audit Commission's View of Politics: A Critical Evaluation of the CPA Process

The Comprehensive Performance Assessment (CPA) process introduced in the wake of the Local Government Act 2000 was in essence a managerial tool applied to a political environment. An analysis of the Commission's first tranche of CPA reports reveals a particular perspective on the role of politics and parties in local authorities which raises issues about the Commission's competence and legitimacy to make such judgements. Composite pictures of the ‘good political authority’ and the ‘poor political authority’ can be drawn up, which display a degree of political naivety and a failure to recognise the differences between political and managerial logic. It is concluded that the CPA process should have taken the political culture of an authority as a ‘given’ (at least in the short term), and evaluated the performance of the authority's management in the political circumstances in which they had to operate. Finally the role of the CPA process in contributing to the government-led pressures for depoliticisation of local decision-making is examined, with a particular concern about the substitution of the concept of ‘the good of the area’ for the different priorities and visions of different parties.     

A Prehistory of the Best Value Regime

Best Value was one of the central planks of New Labour's modernisation agenda for local government. This article uncovers the origins of the regime by unpicking the activities of two working groups responsible for its design. Licking its wounds in the aftermath of the 1987 General Election the Labour Party's leadership had come to see the party's record in local government as a source of increasing embarrassment. A series of policy initiatives, first emerging from the party's policy review, later given the Best Value tag, were intended to neutralise producer interests and improve the party's reputation for governing competence.     

The Role of Competition in Best Value: How Far Does it Differ from CCT?

This article investigates the role of ‘competition’ within Best Value (BV) and compares it with that of Compulsory Competitive Tendering (CCT). Utilising results of a survey of BV lead officers, the article reveals that ‘competition’ is not being used as widely as may have been expected. However, in terms of outcomes, services subject to BV seem to be at least as likely to be provided externally as would have been the case under CCT. Further analysis also considers the impact that party political control and service type have on the use and outcomes of competition.     

Multiple Voices of Modernization: Some Methodological Implications

This paper systematically examines intra-organizational consensus of perceptions of managerial reform in local government in the UK. The paper questions the role of 'elite surveys' in public sector evaluation research by exploring the extent to which multiple informants agree on the expected impacts of Best Value. Results from a survey of 978 local government officers in 80 local authorities indicate modest levels of consensus. These findings suggest that single respondent surveys are likely to produce unreliable data and misrepresent the impact of public sector policy reforms. Rather than rely on the perceptions of one respondent it is argued that multiple respondent surveys should be employed if rigorous and reliable data are to be used in providing evidence-based policy recommendations for reform in public sector organizations.     

Assessing Best Practice as a Means of Innovation

This paper argues that Best Practice and innovation are different, if related activities, with Best Practice being just one of the means by which organisations can innovate. After reviewing the literatures on innovation diffusion and policy transfer, this paper reports the findings of two surveys of Best Practice in English local authorities on, respectively, regeneration and community safety. The paper finds that innovation is related to the CPA, but use of Best Practice is not; that greater capacity affects both innovation and the use of Best Practice; and that there is little link within authorities in the degree of innovation between policy sectors. In evaluating the use of Best Practice, the paper finds that local authorities encounter problems with assessing whether Best Practice is appropriate for their authority and judging whether Best Practice is in fact best practice. With Best Practice guides, the key problem is the difficulty in assessing whether the practice is as effective as the guides suggest and whether it would really work in a particular authority. The paper concludes that more effort could be made to ensure that readers of Best Practice guides can find out how the innovations really work and how they can be adapted to local needs.     

A ‘Fruitless Obsession with Accuracy’: The Uses of Sensemaking in Public Sector Performance Management

Sensemaking provides a framework for understanding and interpreting managers' working lives, based on a thorough critique of rational choice models. It refutes rational choice, and aims not to predict, prove or control but simply to explain: the making of sense. This article, based on the author's original prizewinning MBA thesis, presents research undertaken in 2005–2006 on the uses of sensemaking in understanding local government organisations' contrasting experiences of performance management systems: an internal system in Canadian city government, and an externally-imposed system in the form of the now abandoned Comprehensive Performance Assessment (CPA) in British local government. Key literature utilised includes social and organisational psychologist Karl Weick, British complexity theorists such as Ralph Stacey, and a literature on the politics of organisational behaviour (such as Guy Peters et al.). A critique of rational choice and summary of sensemaking precedes an account of phenomenological case study research across two countries, undertaken using ethnographic field methods. The author argues that using sensemaking to understand performance management systems provides a further imperfect means of making sense of inherent organisational equivocality. These systems are radically interpreted as devices for making sense of experience in organisations in which human behaviour cannot be expected to be forever accurately predicted and controlled. Conclusions with enduring relevance for practising managers are presented on the personal, tactical, methodological and philosophical ‘uses’ of sensemaking in managers' working lives.     

Compulsory Competitive Tendering And Local Government Financial Services: An Analysis Of The Views Of Local Government Accountants In The North West Of England

Between 1979 and 1997, successive Conservative governments sought to reduce the scale of public sector activity and to introduce competition in the provision of public sector services. A central feature of this policy was the introduction of compulsory competitive tendering (CCT). CCT was initially confined to blue collar services but, by means of the Local Government Act 1992, it was extended to white collar, professional services, including financial services. However, though potentially extremely significant, the support for and implications of such a policy are issues which have been inadequately researched. Because of this, research has been under-taken into financial services CCT and has included a questionnaire survey of 300 professionally qualified accountants employed in 17 local authorities in the North West of England, drawn from county councils, district councils and metropolitan authorities. The article presents the findings of the survey, with a particular focus on the views of accountants on CCT in general and financial services CCT in particular. In addition, it provides evidence that the CCT process, irrespective of views on CCT and its appropriateness for specific activities, has changed culture and attitudes in the case of local government finance professionals.     

Industrial relations and manpower

This article provides the first empirical evidence on the impact of Best Value processes on local service quality, costs, efficiency and accountability. Views were obtained from a wide range of personnel involved in the pilot programme in Wales by means of a postal questionnaire and interviews. The evidence shows that so far Best Value has had a positive impact on quality and accountability but little impact on service costs. Perceptions of the impact of Best Value are significantly more positive in authorities that adopted a corporate approach to the pilot process.