Birmingham cityscape

Understanding the cost of the cuts

When the global financial crisis hit in 2008 and cuts in UK public spending were announced, our researchers sought to look at the real cost of austerity. Who was going to be more or less impacted by these cuts? How could this be mitigated to avoid having a disproportionately negative impact on poorer communities?

It became quickly apparent that local government was going to be the main victim of the early stages of austerity. Budgets were cut by around 40% in England and 11% in Scotland. Services provided by local government are very important to everyone, but people living in poorer communities rely on them more to provide for their basic needs.

“I'm particularly interested in issues of inequality between different kinds of neighbourhoods; more affluent and less affluent neighbourhoods,” explains Annette Hastings, Professor of Urban Studies. Professor Hastings led a research project to assess the impact of the cuts and created a toolkit to mitigate negative results. The findings have influenced policy at a national and local government level, inspired public debate and influenced budgetary decision-making in specific local councils.

Funded by the Joseph Rowntree Foundation and delivered in conjunction with Glen Bramley, Professor of Urban Studies at Heriot-Watt University, the research was completed in several stages. The team began by looking at how these cuts would affect people living in different neighbourhoods and understanding who would be more or less impacted.

“We started talking to finance directors and chief executives in a range of local authorities,” says Professor Hastings. “We wanted to understand their approaches to managing austerity. What were they planning? What were their challenges?”

They talked to those making the decisions and to the people directly affected by the reduction or removal of services, including people delivering the strategy at the front line and those experiencing the cuts. They also spoke to voluntary organisations who had increasingly been asked to fill in the gaps in services. In-depth case studies were then carried out with three areas: Renfrewshire Council in Scotland, and Newcastle and Coventry Councils in England. 

“They were all selected because they wanted to know how to make cuts in ways which don't impact disproportionately on those who need their services the most. We developed an analytical framework to help them understand that,” she explains. The framework uses data that allows the local authority to understand whether the cuts were impacting more or less on different groups.

Inequalities became apparent

Through these initial stages of the research, a national picture became clear. Local councils in post-industrial parts of the UK – the bigger urban councils – were bearing the brunt of austerity and losing more resource.

“People who live in a poorer city were experiencing a lower quality of service than they might otherwise expect to receive,” says Professor Hastings, who could see through their research that these poorer groups were experiencing very severe hardship as a result of the cuts.

They also learned that councils are interested in minimising that harm, but doing that was challenging. Professor Hastings explains: “The research showed that despite that mitigation it is very, very hard to protect those who need the services the most when working in a very tight resource environment.”

Our researchers could see that extra support was needed to help local government make financial decisions that would minimise their impact on poorer groups.

A toolkit to address inequalities

Drawing from the analytical framework created for the three case study councils, a new Social Impact Tool was co-produced with Birmingham City Council and is available for anyone to use.

“It’s basically a spreadsheet that councils can input their savings data into. It does a number of calculations that allows them to assess the distributional impact of their savings plans,” says Professor Hastings. “It provides charts and graphs, a quick visual that can be shown to councillors or residents.”

Using data from the Chartered Institute of Public Finance & Accountancy, an accounts organisation that gives a baseline for every local authority about what they spend, the tool tells you who uses particular services more frequently and with greater intensity. For example, social care, children’s services and housing services are used more by poorer groups. There are services that everyone uses almost equally, then there are services which are accessed by more affluent groups such as parking and the arts.

Cuts that may appear simple on the surface can have a disproportionate effect on poorer communities. “If the library closes, for example, they can’t just go to a bookshop. If the local leisure centre reduces its opening hours, they’re less likely to afford a gym membership elsewhere,” explains Professor Hastings.

The tool has proved popular. By September 2017 it had been downloaded 370 times, and council staff in England and Scotland were responsible for 221 downloads. Voluntary organisations, private consultancies, government departments and academia have also downloaded the tool.

Wide-reaching debate

As well as producing a practical tool, the research has influenced policy and stimulated debate, keeping issues of inequality on the local and national government agenda.

In 2017 a socio-economic duty aimed at protecting poorer groups was introduced by the Scottish Government. The duty had been included in the UK Government’s Equality Act 2010 but it was never implemented. Our researchers could see the value of the duty, and how it could help to make sure that strategic decisions are as effective as they can be in tackling socio-economic disadvantage and reducing inequalities. Professor Hastings and her team contributed to policy debates around the duty, using their research to provide an evidenced rationale for its introduction and how it could reduce the impact of cuts on poorer groups.

As a director of the Scottish Regeneration Forum, Professor Hastings also drafted part of their manifesto which argued for the introduction of the duty during the 2016 Scottish Government elections. She also discussed the duty with the Scottish Government’s Independent Advisor on Poverty and Inequality, Naomi Eisenstadt, who eventually included the duty as a recommendation in her Shifting the Curve report in 2017. The team also responded to the Scottish Government’s 2017 consultation on the duty.

What’s next?

The team have been working closely with the Scottish Parliament Information Centre (SPICe) on research into the impact of local government spending cuts since 2016 and hope that this will be a long-term collaboration. For Professor Hastings, her interest in public services and who really benefits from them continues. Next, she’ll be looking at how their methods for managing austerity have really been working.

“We’ve got a long history of doing research which is grounded in evidence, which is theoretically informed, but which is about trying to make a difference,” Professor Hastings explains. “That’s the culture of our team. That’s what gets people into their work on a day-to-day basis.”

About the researchers

Professor of Urban Studies Annette Hastings is interested in the impacts of austerity on cities, neighbourhoods and local government. She is also the Chair of the North Lanarkshire Fairness Commission, which was set up to tackle poverty and inequality in the area.

Professor Nick Bailey is the Associate Director of the Urban Big Data Centre in Glasgow and has particular interests in poverty, inequality and issues of equity in access to public services.

Ms Maria Gannon, Research Associate, Urban Studies has experience in applying quantitative methods in social research in relation to poverty, social exclusion and problem drug use. She has been on secondment with Scottish Parliament Information Centre (SPICe) in 2016 and 2017 collaborating on research into the social impact of local government budget cuts.

Professor Glen Bramley, Heriot-Watt University is one of Britain's leading academics in housing and urban economics. He has been engaged in academic and applied policy research in this field since the mid-1970s.