Thursday 14 October 2010

My speech to County Council

We all eagerly await the Comprehensive Spending Review next Wednesday.
What will it mean for us as individuals? What will it mean for Kent County Council?
But more importantly, what will it mean for our 1.35million residents and the impact it will have on public services?

It is clear we will be facing fundamental reductions, cuts in funding over the next few years, the like of which we have not seen before.

£340million expected for KCC over four years. £136million over the next two years.

The new coalition government is cracking on at a rapid pace. The demolition ball falling in all directions, bonfires occurring everywhere.

Reconstruction will bring significant changes to the way public services are delivered all with substantially less money.

This will affect us in local government significantly in education, health, economic development and regeneration and welfare reform.

But first I will start with the progress being made on facing up to the financial challenge. It is clear that the Spending Review will cover only the next two years quite understandably, bearing in mind the perilous state of this country’s finances and the massive uncertainty on where this country will be in two years’ time - hopefully an improving economy and a substantially improving fiscal position.

This is why I have asked the senior management team to concentrate on years 2011/12 and 2012/13.

There are principally only five tools in the cupboard.

Firstly, reducing to an absolute minimum the pressures and costs on service delivery, resisting as far as is possible price increases in bought-in services, accepting that in many cases demand will rise, for example adult social care and unavoidable inflationary pressures in energy and particularly oil-based products such as tarmac.

Secondly, more effective commissioning and procurement, less gold-plating, more galvanising - packaging contracts appropriately both larger and smaller in some cases - our Find and Fix contract being a prime example.

Thirdly, maximising our income potential, building on our successes in commercial services, legal services, ISG and others. Making critical decisions as to whether this organisation buys, makes or sells.

Fourthly, delivering a lean, efficient organisation that minimises waste, duplication, replication in all areas of the organisation. An integrated organisation working together.

To that end, Cabinet launched on Monday (11 October 2010) for consultation our proposed new structure, which I believe is fit for purpose, logical and rational which will deliver cost reductions of some 20% at the top level of the organisation. This will be another step in the right direction. The significant task ahead in the next few weeks is to develop the lean structure below the four new directorates supported by the Corporate Director of Business Strategy and Support. This will be lean, fit for the future and able to adapt to significant legislative change from the coalition government.

And finally, the last option, or tool in the cupboard to balance the books will be in making decisions on what we may have to stop doing or do to a lesser extent. This is where we are determined, before these difficult decisions are made, that we really maximise the opportunity around saving money around tools one to four above and thereby diminish the impact on service reduction.

Later this morning (14 October 2010) we will be debating the success of the Towards 2010 agenda and on Monday the administration will be launching again for consultation our new Medium Term objectives in a new document Bold Steps for Kent.

This will shape our new priorities, reflecting the massive change coming our way in education, health, economic development, regeneration and welfare reform. I have only time to touch on two of these this morning which are in the area of health and education, started through the Academy Bill and Health White Paper, Equity and Excellence.

The thrust of the change is similar.

Empowering the front line - opening up choice and a free market that encourages innovation in the support of headteachers - schools, doctors - GP practices. Bold Steps for Kent will be outlining our proposed way ahead.

With almost 100% delegation to schools - the establishment of School Companies/Mutuals to deliver a bespoke menu of support services to schools, IT, Finance, School Improvement, HR with no compulsion, in competition with others.

And in Health, the opportunity to support practice-based commissioning through similar companies/mutuals providing real choice to GP practices.

It is absolutely essential that as Community Health Trusts are established that we create real choice - free markets that encourage innovation and radically improved support in community health - district nurses and mental health support as examples.

Control shift is underway. Change is on the way. Change is not without risk but we must seize the opportunity and build a better Kent.