Productivity plan

These are some recent examples of how we have reviewed and changed service provision.

a) Temporary accommodation

The number of households in temporary accommodation rose by:

• 26% in 2021/22
• 27% in 2022/23
• 18% in 2023/24

The budgeted cost in 2024/25 has increased by £3.7m. However, an additional £0.2m of staffing and process changes we made in 2023/24 has slowed the upwards trend.

This meant we could avoid some £1m of ongoing additional costs that we expected in 2024/25 and later years. The savings would have been greater, but the average cost per case to the council rose from £8,500 in March 2023 to £13,700 in April 2024 (for the most common form of accommodation).

b) Housing procurement

We have sought to limit increases in the cost of temporary accommodation by carrying out a procurement to bulk-buy a large proportion of our required accommodation for the next two years.

c) Hybrid and flexible working

The gains we have made have been two-fold.

When trying to attract crucial professional staff, we cannot compete with the private sector on pay. This affects areas such as legal, planning, and digital. We believe the use of hybrid working has been crucial in retention and recruitment of staff.

Additionally, the use of hybrid office working will enable the medium-term repurposing of part, or all of, our main Civic Centre site.

d) Digital programme

We have carried out a significant digital programme to consolidate systems, processes and digital complexities. This has allowed us to develop hybrid working and roll out new services quickly and more cost effectively.

e) Partnership working

We have a close working relationship with other public sector bodies in Essex when it comes to IT and digital programmes. This allows us to reduce the burden on individual councils, such as working together on joint development programmes.

f) Asset review

We carried out a programme to review our land and property assets. Between 2002 and 2020, this released some £76 million, which we reinvested in the local area. Since the pandemic, the unsettled nature of the economic environment has slowed the asset disposal programme. We have been active in the marketing of two brownfield sites, which are likely to start redevelopment in the next few years.

We are committed to developing a council-wide digital system to hold the majority of our data. This is an ERP system which will improve our efficiency in the long run. The current strand of ERP development is to implement a single database to help manage all our assets.

We established a joint Essex system to review data held by authorities looking for potential Council Tax error or fraud. This agreement, between ECC, Essex Police, Essex County Fire and Rescue, the 12 districts and 2 unitary authorities in Essex, provides financial assistance to billing authorities to investigate fraud and error.

It focuses particularly on discounts, benefits, residents’ parking permits and blue badges that have been incorrectly claimed. This has led to the procurement of a data-matching engine, with rules designed by the billing authorities and which identifies mismatches across internal and external datasets containing tens of thousands of records.

Over the seven years of the contract so far, data-matching has identified more than £3 million in additional liabilities we can collect.

We are also a member of the Essex Digital Partnership, which focuses on collaborative working with other authorities. We have several subgroups, including technical and GIS groups, letting us share tips and lessons learned. The group is currently working on two big projects: CAF (for which all 15 authorities are signed up) and Microsoft Dynamics Development (which has 7 authorities signed up).

We accept that some unproductive spend may occur in an organisation of our size. However, the financial difficulties all local authorities face are not a result of wasteful spend, or poor productivity. They are a consequence of rising demand and higher costs, with funding rising at a much slower rate.

We will continue to identify budget reductions every year. We have repurposed some £11 million in the last decade. Recently, however, our scope to deliver efficiencies has become more limited, and easy wins are no longer available.

Regarding our procurement strategy, the overriding requirement is that all procurement must be based on value for money principles and undertaken fairly, openly and transparently.

a) Relationship between central and local government

The lack of a partnership ethos from central government in its relationship with local government is a barrier. This restricts innovation and local freedom to act in local and national interests.

b) Funding arrangements that are outdated and stifle innovation

i. Homelessness

The government funding arrangements for temporary accommodation costs could bankrupt a number of councils, unless they change. We only receive 90% of the 30th percentile of 2011 local rents. This needs to be updated to current rent levels, which are considerably higher than they were 13 years ago.

ii. Housing benefit

This is currently calculated through the Broad Rental Market Area. However, it does not reflect the very high cost of housing rents in Chelmsford, as less expensive areas in neighbouring authorities are included in the calculation, which brings down the amount available for our residents. This contributes to making housing unaffordable and adds to the number of households who are homeless.

iii. Business rate retention scheme

The current scheme is far too complex. Any extra funding is both unpredictable and volatile, so we can only regard it as a windfall. Councils cannot borrow to meet shortfalls in annual revenue income, so we need consistent and predictable government funding to operate effectively.

iv. Funding settlements

Government funding settlements are currently determined on an annual basis. These need to be extended to three to four years, so we can plan more effectively.

c) Supported housing

This is an upper-tier function, but lack of provision results in additional costs for lower-tier authorities.

d) Borrowing rules

Current rules restrict our ability to carry out place making. The definition of regeneration is too rigid; it does not allow long-term strategic asset investment, or strategic acquisitions.

e) Unnecessary administrative burdens

i. Statement of accounts

The statement of accounts is too complex, in terms of its accounting and audit requirements, and is unfit for achieving public scrutiny of district councils. The failure of audit firms to complete their annual audits has created a heavy burden on local government.

ii. DWP requirements

The requirements for housing benefit audits are too rigid and unnecessarily burdensome.

f) Local plans

These are expensive and we cannot recover the cost of producing them from developers, who are the prime beneficiaries. Planning authorities should be allowed to set their charges to recover the full cost of local planning services.

g) Social housing site viability

Post-planning site financial viability tests which cancel agreements to deliver social or affordable-rent properties should be prevented.

h) Joined up thinking

There is a lack of joined-up thinking between central government departments on issues including housing, homelessness prevention and asylum dispersal.

i) Competitive bidding for funding

Cease the separate one-off revenue and capital grant pots with onerous, costly and counter-productive bidding processes. Our resources could be better used.