Financial Resilience of UK Local Authorities During Austerity Era
UK Local Authorities face financial challenges in the era of austerity, impacting their ability to meet community demands. Research on financial resilience and responses to austerity is crucial for sustainability.
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European Group of Public Administration PhD and Early Career Symposium Queen s University, Belfast 9th- 10thSeptember, 2019. UK Local Authorities Financial Resilience during the Era of Austerity Bernard Kofi DOM, PhD Student Dr. Martin JONES Assistant Professor in Financial Resilience and Accountability Professor Alan COLLINS Professor in Economics and Public Policy
Outline Outline Introduction (Background) Research Problem . Research Aims/Objectives Methods & Literature Review Research Project (Contingency) Plan UK Local Authorities Financial Resilience during the Era of Austerity Possible Research Project References
Introduction (Background) Introduction (Background) UK government implemented austerity measures to manage public service after the Crisis UK Local Authorities (LAs) are challenged with demand and financial pressures in their communities. Financial Failure at More LAs to follow?
Demand and Financial Pressures Demand and Financial Pressures 97% of LAs Planning to increase Council Tax in 2019/20 (Three quarters by more 2.5%) Over 50% of LAs Planning to use some of their reserves this year (40% have been using their reserves for two years running) Almost 33% of LAs risk depleting their reserves in 10 years (Almost 20% of LAs set to be at risk by 2021) Survey by Local Government Information Unit (LGIU, 2018) New funding formula with 75% Business rate retention is due in April 2020. (HMT 2019)
Research Problem Research Problem UK LAs have been challenged with cuts in their RSGs from the government (CIPFA, 2017). Research gaps exist in financial resilience as a new research term which is currently rarely defined and understood (Turcu et al., 2015). How have UK LAs fared to survive austerity?
Research Aims/Objectives Research Aims/Objectives Austerity Era - A great opportunity UK LAs responses through the lens of financial resilience during the era of austerity. Austerity impacts on UK LAs Choices made to sustain challenges experienced during the austerity era Prioritisation and Reprioritization Financial resilience trends/patterns in UK LAs response to survive pressures from the austerity era. Research findings will further help to develop financial resilience in the English perspective.
Methods & Literature Review Methods & Literature Review Research Objectives Quantitative Impact of Austerity measures on UK Local Authorities - Changes in Regulations - Increase in Demand (Service Pressures) Financial Resilience (Choices) - Capital receipt - Changes in initial reserves - Shifting of expenditure priority RESEARCH DESIGN LITERATURE REVIEW Qualitative Perception of Vulnerability Impressions of austerity impacts Themes and Theories - Perceived Vulnerability - Governance and Accountability - Control & Quality Management - Financial and Organizational Resilience - Public Service Management - Changes from Government Funding (RSGs) - - - Increase in income - - - - What Why How Any change in plans Theories Keynesian Classical Theory, Vroom s Expectancy Motivation Theory, Financial Resilience Theory, NPM Theory (Public Value, Managerialism, TPA), Cutback Management Theories, Theories on Agency, Stakeholder, Signalling, Resources Dependency, and Maslow s Theory of Needs. Financial Resilience (Trends and Patterns) - Clustering (Regression/Correlation) - - Clustering Coding
Research Project (Contingency) Plan Research Project (Contingency) Plan S/N Incident 1. When LA dataset lacks consistency in proposed time series Response I will select and use a dataset that has a consistent time series from 2005 to 2020. 2. If the study looks similar to an article in a 3* journal The research question(s) will evolve over time. As I will adopt a longitudinal study, the project will develop with time to enhance credibility to avoid similarity. I will adopt a snowballing technique to ask participants for introduction to their fellow CEOs/FDs of other local authorities. 3. When participants (CEOs, Finance Directors of Local Authorities) are unavailable and participate for the structured interview. Interview questions seem to deviate from the research idea. unwilling elite to semi- 4. I will conduct a pilot study to test questions and review the structure interviewees/participants. of questions for 5. Limited time to meet Project Transfer Deadline I am writing up whilst reading reviewing literature and analysing data. I have structured the Gantt Chart to allow a grace period of 4-6 months.
Possible Research Project Possible Research Project Contribute to existing knowledge and literature - Larger scale (UK LAs by type and location) - Rich and Informative Dataset (delve more into services) - Apply knowledge to other sectors (Education) - Conduct comparative studies Develop a conceptual model which helps to understand financial resilience. To assist in formulating policies (by key stakeholders responsible for key decision making) to enhance resilience at the local government level.
Any Any Questions? Questions?
References References CIPFA. 2017. Building Financial Resilience: Managing Financial Stress in Local Authorities. London: The Chartered Institute of Public Finance and Accountancy. National Audit Office (NAO). 2018. Financial Stability of Local Authorities 2018. Report by the Comptroller and Auditor General Norwich: TSO and London Houses of Parliament Shop, London. Turcu, C., Karadimitriou, N. and Chaytor, S., 2015. The impact of the global financial and economic crisis on European cities.
