Annual Conference

We report back on the events at CIPFA in the North East's Annual Conference

On 25 November 2016, CIPFA members from across the region and elsewhere gathered at The Sage, Gateshead, for the CIPFA in the North East Annual Regional Conference.

CIPFA in the North East President Clive Johnson opened the conference – the theme for the day was 'Commercialisation and Collaboration'. Sir Tony Redmond, Past President of CIPFA & our Conference Chair, introduces the day. This is our sixth Annual Conference, and his sixth as chair. He said that the public sector is reaching the limits of efficiency savings. The status quo is being challenged; there needs to be an end of a silo mentality.

Andrew Burns, CIPFA Vice President, was the first speaker. He confessed this was his first visit to Newcastle since the FA Cup in 1974! He asked whether the British public were expecting Scandinavian-level public services whilst only paying American-level taxes. A stronger medium term planning focus was needed; not just focusing on next year's revenue budget. Collaboration was a human and political challenge, but can bring significant financial benefits. There were risks from collaboration in areas such as governance, risk management, transfer of assets and liabilities, and so on. But health and social care integration was leading the way in public sector collaboration.

Richard Harrison from CIPFA spoke about the commercial approach to providing public services. A commercial approach in public services was nothing new; it lay behind the Victorian infrastructure programmes for gas, water and electricity. Another early example was the creation of Newcastle Airport in 1935. 58% of councils now own a trading company, and there had also been an increase in shared services. A wide range of public services (schools trading, adult social care, leisure trusts, back office and property development companies) were becoming commercial. There was no magic ingredient for success. But you need to have a clear business case and be clear on governance.

After a break for refreshments, conference resumed with Ian Cosh from Lancashire Constabulary, talking about financing policing using a collaborative approach. The key was Early Action, ie a focus on preventing crime and keeping a local presence in communities. There was a common workload across public services in Lancashire, dealing with vulnerable children and adults. His role was to keep the people of Lancashire safe – using his accountancy skills as a CIPFA member to help.

Jon Walker from Tyne and Wear Archives and Museums Service spoke about The Entrepreneurial Museum. His background was retail, but he joined the Archives and Museums Service in 2005. The service directly runs nine museums across the region, and supports 55 other through its development programme. It covers 18% of its costs from generated income; the rest comes from its funding partners. Council funding for the service has dropped 43% since 2009. So it needed to focus on commercial performance and generating income. From 2013, the service has looked to identify areas of weakness and improve on them. Cultural change was needed at the service, involving a clear vision for the future, and accepting a certain degree of discomfort. An enterprise team was established to meet monthly, monitor KPIs and challenger and support each other. Exhibition entry feeds were introduced for special exhibitions; traditionally, all exhibition entry had been free. Events, talks, tours and experiences were also developed to bring in new people and generate income. Twenty-seven weddings had been held at their venues last year!

After lunch, Louise Kempton of CURDS Newcastle spoke about the issues, principles and practice of decentralisation. Sadly, they had to launch the results of their research on decentralisation at a London venue in order to get any media attention! There were different forms of decentralisation, from administrative to full devolution, as in Scotland, Wales and Northern Ireland. There was asymmetric decentralisation across the UK. There are multiple and competing goals of decentralisation, which may contradict each other. You need to be clear on the rationalisation for decentralisation in each case. Even amongst the devolved nations, the funding, powers and responsibilities differ between Scotland, Wales and Northern Ireland. The UK is moving the other way to the rest of Europe on the percentage of taxes raised locally, from 11% in 1975 to 5% in 2012. This needs re-balancing. Accountability, transparency and scrutiny need to be considered as part of decentralisation proposals. The UK needs a National Constitutional Convention to consider and co-ordinate the myriad forms of decentralisation that exist. She asked what the future (eg 2030) looks like for decentralisation in England. Ironically, we need the centre to take the lead on decentralisation in our currently highly centralised nation.

Rob Whiteman, Chief Executive of CIPFA, talked about the forecast for public sector finance. He did a whistle-stop tour of the changes since he was with us last year – a mistrust of political cultures across so many countries. He noted that great leadership in greater Manchester had led the way in leading to decentralisation for that city region. He predicted that the government will have to put more money into the NHS and social care within the lifetime of this parliament. His advice to all public sector bodies was to not be over-optimistic on public finances. Organisations are likely to have to dig deep into reserves over the next few years. He was also enthusiastic about Big Data and analytics and how they can be used in the public sector.

Maxime Hewitt-Smith, Director of Finance at South Tees Hospitals spoke about sustainability and transformation planning in the NHS. She is also chief finance officer of the local STP, covering Tees-side and parts of North Yorkshire. There are 41 STP areas across the country; these each have to submit a plan answering 60 questions about health and social care services in their areas. There will be a £281m gap in her STP area by 2021 if nothing changes. Services need to deal with rising demand. She looked at the STP through the prism of four fictional patient journeys - Oscar, Ethel, Frank and Alice.

The conference then broke into a panel session featuring the speakers, with the audience asking questions about the key issues from the presentations. Sir Tony Redmond wound up the Annual Conference with a summary of the main themes from the day – commercialisation and collaboration. The delegates then headed out to the lobby to end the day with a drinks reception, kindly provided by our sponsors EY.