The future of local delivery

Sophie Wilson Research Director, Head of Government and Society	Nadia Badaoui Associate Director

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In conversation with Dr Eleanor Carter, Research Director at the Government Outcomes Lab

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Reimagining Government: Delivering on the Promise of Place-Based Approaches

The UK, like many similar nations, is grappling with a rising demand for public services and pressures to address complex social issues such as homelessness, poverty, and mental health. These issues are experienced by people on a daily basis, and there is widespread support for action. Yet they prove to be stubborn and challenging for government to solve.

One particular area of concern in the UK is regional disparity, with regional imbalances ranking the highest among advanced economies.¹ Britons are also more likely to view the inequality between deprived and less deprived areas as a serious problem compared to citizens in other European countries.²

Previous UK governments have made attempts to rectify this imbalance, including the latest Levelling Up initiative in 2022. The objective of Levelling Up³ is to target central government funding towards local projects that stimulate economic growth, job creation, transportation improvement, skills training, and local business support in areas that require it most. It has involved establishing devolution deals with local government, granting them power to make decisions over certain services. This is something the public tell us they want: three in five support local authorities having more control over local decisions.⁴

However, so far, the potential benefits of devolution don’t seem to be cutting through to local communities. The Ipsos Levelling Up Index⁵ reveals that public perceptions on regional differences continue to persist across the majority of the 12 Levelling Up missions⁶.  People are skeptical about the effectiveness of current policies in addressing these missions, and in some cases, they believe the situation has worsened over time. Despite the increased attention brought by Levelling Up, it is worth noting that people across the country feel neglected and consistently believe that the national government allocate less funding to their area compared to others. This sentiment is particularly prominent in regions further away from the Southeast, especially in Northern England, Wales, and Northern Ireland.

 

 

A recent paper⁷ revealed a consensus among 90 former UK government leaders spanning from 1979 to 2016 on the reasons for the persistent failure to address regional disparities. They argued that previous attempts at regional policy in the UK have been too centralised in Whitehall and have been hindered by political instability and short-term thinking at the centre.

Critics of Levelling Up have highlighted its failure to address this crucial barrier too: effectively using national government levers to solve complex issues while accommodating local needs. They have also raised concerns about insufficient funding to compensate for the significant cuts in local spending since 2010.  Additionally, critics argue that the funding provided by Levelling Up lacks targeting, and that the competitive bidding process used to allocate funds is ineffective and inefficient.

So, how can the government make communities feel better taken care of while also addressing the systemic challenges facing the country as a whole? One increasingly popular answer is ‘place-based’ policymaking.

What is ‘place-based’ policymaking?

Many academics and policymakers are increasingly looking to ‘place-based’ policy, with the term becoming increasingly widespread, if not well-defined. Generally it refers to policies that aim to reform the funding and co-ordination of local services in order to address complex issues within specific geographic areas or region. The need for better co-ordination of local services often stems from inefficiencies in how they are currently managed, which is closely tied to central government policy and funding⁸.

While there is widespread support for place-based approaches, there is no clear consensus on how they should be implemented structurally⁹.  Some view ‘place-based’ as less of an innovation and more of a re-telling of previous attempts that government has struggled to make work. The Government Outcomes Lab recently analysed 55 government initiatives spanning 25 years¹⁰ that aimed to improve co-ordination of local services. They found that while these initiatives may be easy to get behind politically, and were designed to promote collaborative and locally-led decision-making, only a few instances involved jointly defining objectives with local government. This creates tension between the ambition for joined-up, locally-led services and the need to align with ministerial directives and maintain central accountability. In our interview with Dr. Eleanor Carter, Research Director at the Government Outcomes Lab, she notes:

"It’s exciting to think about place-based policy as a promise and a potential response to tackle these spatial inequalities – but we’re almost throwing spaghetti at the wall in terms of the range of policies that are trying to respond to these challenges."

- Dr. Eleanor Carter, Research Director at the Government Outcomes Lab

 

How can we break the cycle?

To break the cycle and improve place-based policy, policymakers should consider several factors, including the following three-step approach:

1. Shift towards funding partnerships rather than relying on directives
2. Designing policy and measuring outcomes systemically 
3. Building capability for learning and innovation

1. FUNDING PARTNERSHIPS RATHER THAN RELYING ON DIRECTIVES

This means allowing local governments to have more flexibility in how they spend money while still being accountable to taxpayers. Dr. Carter suggests that it also involves changing the dynamic between central and local government from a transactional and directive approach to a more collaborative and nimble partnership. By working together to develop, implement, and measure policies, central and local governments can better address the complex challenges faced by local areas. This approach, often referred to as a ‘relational’ model focuses on building trust between central and local government to implement national policy in ways that better suit the specific needs of each locality¹¹.

"Changing the dynamic so that it’s less one part of government holding the purse strings to exert force over another, but actually a more mature and subtle approach that acknowledges the strengths of both to understand different issues, differently, and to work with more of a collaborative rather than antagonistic dynamic."

- Dr. Eleanor Carter, Research Director at the Government Outcomes Lab

The concept of funding partnerships is already reflected in the ‘trailblazer devolution deals’ such as those for Greater Manchester and the West Midlands. These deals aim to empower local governments through the Levelling Up strategy, giving them the freedom to fund and implement initiatives outside of centrally defined programmes and reporting measures. By transitioning to a single funding settlement for each region for a full spending review period, each combined authority can invest in locally-defined projects across a range of policy areas.

This approach also allows for the integration of services, such as Greater Manchester’s plans¹² to further integrate transport, housing and regeneration efforts. Our interview with Fiona Aldridge, Head of Insights at the West Midlands Combined Authorities, suggests this approach is starting to pay off as it allows for briefs held by different national government departments to be better co-ordinated locally leading to improved outcomes.

However, some argue that the current model of bespoke deals for specific areas does not go far enough and should be expanded. The Institute for Fiscal Studies suggests that the funding partnership approach should be applied more broadly to ensure a comprehensive and effective implementation of place-based policies.

2. DESIGNING POLICY AND MEASURING OUTCOMES SYSTEMICALLY

This involves designing policy and measuring outcomes across organisational or policy boundaries. This is crucial for incentivising initiatives that require one organisation to invest, even if the benefits are being realised by another.

Homelessness is one example that illustrates the challenge. It is a complex issue that requires collaboration among public, private and voluntary organisations. According to our Homewards polling¹³, while the public recognises the complexity of the causes of homelessness and supports interventions, there is pessimism about the government’s ability to make a difference.

One reason for this pessimism is that central government departments are not equipped to design policy or funding that mobilises systems change. For example, Housing First initiatives advocate for stable homes as a pathway to providing broader support for the homeless. However, investing in affordable accommodation incurs high upfront costs for local authorities, and the benefits may take time to materialise across services such as healthcare, policing, and employment. Part of the challenge lies in justifying the high upfront cost when the benefits are shared across multiple remits and budgets in central government (the Home Office, Department for Work and Pensions, and Department of Health, among others). These departments have different responsibilities and budgets, making it difficult to allocate funding for such initiatives.

To address these challenges, there is growing interest in using systems thinking as part of policy design and evaluation. Systems thinking helps understand how different parts of a system interact and how interventions can achieve sustainable outcomes. Approaches derived from systems thinking offer useful techniques to grapple with complexity and identify key assumptions about how policy implementation aims to affect wider system change. For example, in 2019, the Centre for Homelessness Impact (the UK government’s What Works Centre for homelessness) convened central government actors, local services, and charities to develop a systems map¹⁴ to assess the causes and consequences of homelessness, which informs the design of ‘Test and Learn’ interventions to end homelessness.

While locally-defined interventions are important, it is crucial to consistently measure outcomes and generate learnings. This requires stakeholders to work together in a ‘data stewardship’ approach, rather than focusing solely on ‘data ownership.’ For example, in our interview with Dr. Carter, she discusses the DCMS Life Chances Fund which enabled local commissioners to take an outcomes focused approach. Every project was locally-designed and focused on a variety of challenges, including supporting children in care and healthy ageing. While each intervention produced outcome data, creating a ‘data rich environment’, the lack of comparability across projects limited the assessment of overall impact. To overcome this, discussions were held to create a meaningful dataset for measuring success and integrate data collection into existing systems locally.

"In theory, this should be a really data-rich environment, because each project is tracking the types of outcomes that are being achieved by participants. But we actually found that there wasn’t very much standardised tracking or recording of some core information when we started researching and walking alongside these projects. So we needed to [facilitate] conversations between local teams on what a meaningful dataset would look like."

- Dr. Eleanor Carter, Research Director at the Government Outcomes Lab 

3. BUILDING CAPABILITY FOR LEARNING AND INNOVATION

This final step in our three-step approach involves fostering innovation and learning throughout the policy implementation and delivery cycle. Local governments need the capacity to understand the problems in their areas, design and trial interventions, and iterate or change course based on what works. This is not always possible in the current commissioning process, where targets must be reported under centrally defined programme requirements that lacks flexibility to accommodate local priorities and changing focuses. To resolve the tension between central accountability and local decision-making, it is important to provide more flexibility for local government to explore the problems, define solutions, and share good practice. This can be achieved by allowing local areas to hold themselves accountable for the process and longer-term targets, while also promoting learning and scaling up innovation through the use of central and regional government offices as a structure.

"Part of the opportunity is making space for innovation and learning… How can government be a convener or a shaper of a conversation, not a director of a plan. That’s a very different set of capabilities for policy teams and I also think it can change the work of evaluators and academics… we need tools that are really adaptive and capable of picking up on these subtle changes that need to happen over time."

- Dr. Eleanor Carter, Research Director at the Government Outcomes Lab 

In addition to fostering innovation and learning, evaluation approaches that allow for adaptation and capture incremental change over time in complex systems are crucial. To enable this, policymakers should complement counterfactual impact evaluation with theory-based, learning-oriented approaches. For example, recent programmes such as Changing Futures and the Partnerships for People and Place Programme have developed learning partnerships that encourage sharing throughout delivery. Ipsos’ evaluation of the Partnerships for People and Place Programme used developmental evaluation approaches to capture and synthesise learning throughout the programme, working in partnership with DLUHC to engage wider stakeholders from central government, academia, and sector partners and encourage dissemination. The programme is funded through the government’s Shared Outcomes Fund, which has provided £400 million for pilot projects aiming to test innovative ways of working across the public sector. The Fund was developed with the recognition that difficult challenges often sit at the intersection of multiple public sector organisations and central government departments.

Efforts to build capability for learning and innovation are also being supported by organisations like The Royal Foundation and the Health Foundation. For instance, the Tech for Better Care programme, in which Ipsos is the evaluation provider, takes a developmental approach to scaling care-led tech innovation in the social care sector. We work closely with cross-sector partnerships formed of councils, NHS trusts, academics, and private tech companies as they develop concepts that are locally-led and address the needs of care providers and people in care. Through a flexible and needs-driven approach, the project is fostering innovation and filling the gaps left by central government funding.

While these programmes and initiatives are making progress, there is potential for central government to address challenges relating to data stewardship, scaling-up learning and innovation from evaluations, and embedding systems thinking into policy design.  By going further in these areas, policymakers can enhance the capability for learning and innovation in place-based policy.

Where next?

To fully harness the potential of place-based policy making, there are three key actions that public services and central government should consider:  

1. Creating a clearer role for central government. This involves setting a clear strategy, convening stakeholders around a shared vision, and enabling adaptation while also holding local government and other organisations accountable.
2. Setting a new model of working with local authorities. This model should provide the necessary flexibility for local authorities and facilitates data sharing and innovation across organisational boundaries, including with private and voluntary sectors.
3. Adopting a systems-view approach to policy development and target setting. This approach considers the broader impact and interdependencies of policies, taking into account the complex and interconnected nature of the challenges faced.

By taking these steps, policy-makers can unlock the full potential of place-based policy and effectively address the challenges posed by our increasingly complex and fast-moving world.

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References 

1 Myles, D. (2023). UK's inequalities biggest among OECD peers, fDi Intelligence 

2 Ipsos, The Policy Institute & Kings College London (2021). Inequalities around the globe: what the world sees as most serious.

3 GOV.UK. What is Levelling Up?

4 Ipsos (February 2023). Ipsos Levelling Up Index

5 Ipsos (February 2023). Ipsos Levelling Up Index

6 The 12 missions include increasing pay, employment, and productivity; investment in research and development; public transport connectivity; internet coverage; primary school education; skills training; life expectancy; well-being; pride in place; home ownership and decent homes; crime reduction; and devolution. 

7 Turner, D. et al. (2023). Why Hasn't UK Regional Policy Worked?, Harvard Kennedy School 

8 As demonstrated in evidence from our forthcoming evaluation of the Department for Levelling Up, Housing and Communities’ Partnerships for People and Place programme, and extensive research on the need for more localised and person-centred approaches. 

9 The paper by the Harvard Kennedy School finds little consensus on solutions and leaves a series of ‘open questions’ on what reforms should be made.  

10 Gibson, M., van Lier, F-A. & Carter, E. (2023). Tracing 25 years of 'initiativitis' in central government attempts to join up local public services in England, Government Outcomes Lab 

11 See for example, the GO Lab’s work on ‘Partnerships with Principles: putting relationships at the heart of public contracts for better social outcomes’, or more recently, ‘Harnessing Complexity for better outcomes in Public and Non-profit Services’ by French et. Al.

12 Greater Manchester Combined Authority (2023). Greater Manchester strikes trailblazing new devolution deal

13 Ipsos, Royal Foundation & Homewards (2023). Understanding public perceptions of homelessness in the UK

14 Homelessness Prevention Map