A good example of how this can be done is Wandsworth Council’s latest transparency release. It has published a list of 96 indicators that rank all of their services, highlighting in particular the 27 that residents will be most familiar with. 

The ratings are also benchmarked against every other authority in London, meaning polticians and council officers, as well as residents, are able to see areas in which they can improve service delivery. Where the council’s performance is below the London average, a Cabinet Member explains why and details potential actions being taken to see it improve.

Which shows that this isn’t a vanity exercise, either; Wandsworth haven’t just picked the services they perform the best in to show off. One indicator shows they have the lowest Council Tax in London, but then others show the Borough ranked 15^th (out of 32) in terms of major roads in need of repair, 15^th for pupils achieving 5 A*-C grade at GCSE and 7^th for good management of conservation and nature areas. These are clearly areas they can improve in, relative to other Boroughs. And if other indicators are more important than the 27 selected, then residents can vote into the top 27 those most important to them.

Wandsworth’s initiative also demonstrates that the arbitrary star rankings and traffic light scores dished out by the Audit Commission are unnecessary. They cost taxpayers’ money as councils scrambled to score well and comply with top-down targets. Residents are far better judges than a faceless, bureaucratic quango.

While this information is often in the public domain in some form or another, Wandsworth should be congratulated for presenting it in clear and understandable way to local taxpayers. Let’s hope other councils follow suit and allow all taxpayers across the country to benefit from this kind of openness and transparency.

The proposal – if passed by the full council in February – ensures residents in Windsor and Maidenhead will pay the lowest Council Tax in the UK outside London. This means real savings for hard pressed taxpayers – for band D residents, Council Tax has fallen by £61 over the last 3 years.

The council have made  significant savings to make the Council Tax cut possible:

• The business improvement programme saved £1.6 million
• £10 million was saved from a renewed waste contract (over seven years)
• £296,000 was saved by adjusting the sweeping and litter contract
• £850,000 was saved by proposals to reconfigure a number of service
• £100,000 was saved through re-tendered insurance contracts

While making these savings the council has actually increased spending in other areas, like an additional £2m in adult services, an extra £1.2m for highway resurfacing and £400,000 for street lighting repairs.

Spending priorities will obviously vary from council to council, but Windsor and Maidenhead show that savings can be made and passed on to taxpayers. Unfortunately many councils are planning the exact opposite, announcing planned increases in council tax of up to 3.5 per cent (the limit at which councils can get away without consulting residents). We’ll be keeping a watchful eye on them as next year’s budget plans are released over the next few months.

Staff are shared between the two authorities, and most services are integrated. This has included shared terms and conditions for staff, and joint department managers between the two councils. Of course, each authority provides different services depending on their local area, but the way they have co-ordinated their operations have allowed South Oxfordshire to pass on the savings to local residents.

This is good news. Individuals have to make savings to their own budgets and councils have to cut back too; why shouldn’t councils look to ease the pressure on their residents? It was disappointing to see Brighton and Hove Council reject central government’s incentive to freeze council tax last week, opting instead to increase it by 3.5 per cent. Their refusal to do so led to Brighton and Hove Council’s Cabinet Member for Finance and Central Services, Cllr Jason Kitcat, being named as the TPA’s November’s Pinhead of the Month. While it’s good to see most local authorities have accepted the freeze, it is even more encouraging to see councils go one step further and reduce council tax for their residents.

Earlier this week, Hammersmith & Fulham council announced they are to cut council tax next year by 3.75 per cent. Due to a variety of cost-cutting measures, including combining services with Westminster and Kensington & Chelsea councils, they have been able to cut management and overhead costs by half. As a result they are able to cut their council tax for the fifth time in six years. It is disappointing that more local authorities do not look to pass on savings to residents through lower council tax bills.. Many could start by ending recruitment to non-jobs, and our research archive contains a whole host of other savings to be made.

Local authorities across the country should take a closer look at tax-cutting councils to see how it can be done, even with necessary spending reductions.

This tax cut will be realised without resorting to the kind of ‘bleeding stump’ approach of shutting libraries and cutting services that some councils have taken, say H&F:

“While planning to cut [council] tax, H&F is intending to freeze parking charges, keep all its libraries open, maintain weekly or even twice-weekly refuse collection and plough £1.3 million into extra town centre police.  It is also one of just two councils in London offering homecare to people in the ‘greater moderate’ as well as ‘substantial’ or ‘critical’ banding.”

Further savings are to be made by selling off underused property, co-locating services among other measures in order to pay off about half the council’s debt and reduce annual interest payments.

We are pleased to see that some councils are giving taxpayers a break. The dramatic savings that H&F are proposing show that other councils can follow suit with tax cuts by cutting out waste. Sharing services can be a sensible way forward, too. It’s a shame that other councils are choosing to increase council tax, like Brighton & Hove who are looking to impose a 3.5 per cent hike.

The welcome move by the Department of Communities and Local Government to use money generated through other taxes to help councils freeze council tax bills cannot compete with genuine tax cuts. Funding from central government grants may be falling but since council tax has doubled over the last ten years, there is plenty of space for efficiency savings and for more creative solutions.

Cllr Stephen Greenhalgh, Leader of Hammersmith and Fulham council, spoke at a TaxPayers’ Alliance fringe event at the 2011 Conservative Party Conference. He explained the position they were in when they took over and how things have changed since then. Council tax has fallen from one of the highest levels in the country to one of the lowest, while debt levels have been reduced at the same time.

Other councils should look at how tax cuts across the country have been achieved and copy good ideas.

Perhaps the most worrying figure in the report is the UK has a liability of £2.4 trillion – the amount of money that taxpayers are currently committed to paying out if there was no change in government policy. This is a staggering sum – equal to 170 per cent of GDP. Even if the government sold off every asset it had, from the Royal Navy’s ships to the road network, we would only be able to pay off less than half this liability.

It’s a stark reminder of the challenge facing the government. The deficit is equal to 92 per cent of the public sector wage bill. The net public service pension liability (not including state pensions) is over one trillion pounds.

There are still many organisations not included in the report, perhaps most notable the banks in ‘temporary’ public ownership and various transport organisations, so the total size of the state is yet bigger than the report suggests. However, they may be included in future releases to give a more representative picture.

There is a huge amount of information presented in this report so it is well worth a look, whether you’re interested in pensions, the cost of services or simply curious to see where your money goes.

This degree of transparency is still in its infancy though, and will hopefully become more efficient and more meaningful in some areas. After all, allowing residents to properly analyse spending without having to wade through a maze of indecipherable data is the whole point.

Some councils are going beyond the £500 limit. Hammersmith and Fulham have recently published all spending, not just to suppliers and not just over £500. They have acknowledged the benefit of this exercise to taxpayers and ultimately to the council themselves.

While they admit there are limitations to the data at this early stage, it is undoubtedly a big undertaking and one which we would encourage all other councils to follow.

“big expenditure cuts are always hard but auditors feel that well-managed councils can deliver their 2011-12 budgets. Facing big cuts is not, on its own, enough to worry auditors. It is councils with big cuts and weak management that are at higher risk of not achieving their budget. Good financial management is helping most councils cope in 2011-12.”

The report explains three ways councils can help plug the financial gap. They can either raise charges and/or council tax, dip into reserves or make reductions in spending.

Many families are struggling, making savings to household budgets and coping with increasing fuel and energy bills. That means raising council tax or charges is unacceptable. It’s a lazy option.

At the start of the 2011-12 financial year, councils held £11.8 billion in reserves. This was equivalent to 30 per cent of total revenue spending in 2010-11. According to the report single tier and county councils held unallocated reserves equivalent to two-thirds of their central government reduction in funds, and district councils around twice the value. If earmarked reserves are included in this figure then the picture is markedly different: district councils reserves are then six times the value of their cuts and single tier and county councils nearly three times.

But when it comes to using reserves, Sir Merrick Cockell, Chair of the Local Government Association makes a strong point: that councils should only consider dipping into their reserves in extreme measures and only for use in the immediate term.

The final way of making up the shortfall – cuts to spending – is something the Audit Commission says is essential. Once falls in income and reserves are taken into account there is a net gap of 7 per cent in total income available to fund services for single tier and county councils and 8 per cent for district councils. But those figures relate to existing services. Councils must consider the difficult but necessary options of scrapping services or departments that are not a priority, or can be performed by someone else.

Besides, the report states that there was no identifiable link between the extent of impact on services and the size of cuts. It is something that is more affected by local decision making and individual council priorities, meaning many councils’ excuses don’t stand up to scrutiny.

Much of this report confirms what the TPA has been claiming for some time – that spending cuts are achievable through good management and the willingness to make difficult decisions. Councils should look through our research archive for suggestions on what to cut. Harry Phibbs’ list of 100 ways to cut council tax without cutting key services also has some excellent suggestions.

Most reporters have focused their write-up on eye-catching cons like the local government officials tricked into paying £7m into false bank accounts. But of far greater significance are the everyday, bread-and-butter frauds that make up the vast majority of the stolen money. Of the £185 million detected, £110 million was lost in illegal claims for council tax and housing benefits, and £22 million in false claims for student and single person council tax discounts. The value of the 1,800 homes recovered from social-housing fraud stood at £266 million.

But these are just the amounts detected. It’s welcome news that detection is up 37 per cent, but from such a low starting point the rise is minuscule. £185 million is still less than 10 per cent of the total estimated local government fraud.

The figures also reveal sharp contrasts across the country, with some councils performing much worse than others in their counter-fraud efforts. The Audit Commission estimates that 1 per cent of social housing is occupied by illegal subletters and other fraudulent tenants, but the North East councils recovered only 3 properties – less than 0.002 per cent of their total housing stock. The picture isn’t good anywhere. Even if London councils did proportionally better – they clawed back 0.306 per cent of their housing stock – the Audit Commission estimates housing fraud is also more of a problem in London, with fraud accounting for 2.5 per cent of the housing stock. Some experts put the figure as high as 5 per cent.

So what can be done? Councils have responded to the report by complaining about staff and budget cuts. This ignores the highly successful measures taken by some local authorities at very low cost. Ashfield Council spent £10,000 on a whistleblowing and investigation campaign and recovered 8 council houses which would’ve cost £1.2 million to replace. Havering Council spent £40,000 investigating single-person discounts for council tax and saved £300,000. Effective anti-fraud measures can save councils money.

The Audit Commission has provided a long list of excellent measures councils can easily take to tackle fraud. They range from pooling resources to improved risk assessment. There are more general, but no less important recommendations like highlighting vulnerable spending and a ‘zero tolerance culture towards fraud’.

But these huge lost sums suggest a deeper problem with the benefits system itself. Labyrinthine layers of tax discounts and benefit hand-outs create opportunities for fraudsters and administrative difficulties for local authorities. A simpler tax and benefits system would close those opportunities, and increase the ability of local authorities to detect abuse.

It’s in taxpayers’ interest that fraud is attacked at both ends – restricting the ability of criminals to play the system, and ensuring that authorities notice fraud and consistently prosecute against it. Local government fraud forces up council tax, hinders legitimate claimants, and limits the money that can be spent on services residents want most. With the extra £50 million detected this year local councils could pay off debt, fund 700 libraries, or 11,000 care workers, for example.

GPCs are credit cards used widely throughout the public sector. For many items they are often the most efficient way to purchase goods and save significant sums in administering expense claims. Previously, civil servants had to pay for items themselves upfront and wait for claims to be signed off. With corporate credit card schemes, there is not the same concern. However the ease of making purchases has resulted in many dubious claims slipping through the net. Of course we are fully supportive of a scheme that if used correctly would save taxpayers’ money, however until now, spending by civil servants on credit cards has gone largely unchecked.

It is great news that the Government has been paying close attention to revelations such as those covering spending in Whitehall Departments, Local Authorities, the Equalities and Human Rights Commission, NICE, Ordnance Survey and the Health and Safety Executive. In addition to stricter oversight policies, publishing details of transactions online (in an easy to use format) will hopefully make civil servants think twice before booking into 4 or 5 star hotels, or making dinner reservations at Michelin starred restaurants.

But why only publish spending over £500? While it is consistent with other government spending releases, it is an arbitrary figure that would still exclude a huge number of transactions. Many of the claims made on GPCs are small in value, and indeed so too are many of the egregious claims, all of which would be exempt from publication. Strangely the Government’s own press release notes a couple of transactions to support their policy. Unfortunately one of the items, £258 spent at Puppets by Post which sells “finger puppets, hand puppets and glove puppets”, would clearly go unpublished under these new guidelines.

In our experience of requesting information on GPC/credit card spending, providing information for transactions above a certain threshold is often more expensive and demanding because of the transactions needing to be removed. Instead, the Government should consider revising its policy to cover the publication of entire GPC and credit card statements (personal details redacted, of course). Publishing entire credit card statements must surely be easy than filtering out claims under £500.

The Public Accounts Committee said:

“We questioned whether the culture within the Department was sufficiently focussed on value for money…While the Department had increased its focus on value for money, it acknowledged that it had not yet maximised value for money in everything it was doing and could do more.”

Time after time, the British public show their generosity – best highlighted by their amazing response to natural disaster appeals. But when it comes to how the Government spends taxpayers’ money, things are less rosy. Previous TPA research has shown that 13 per cent of DfID’s budget is spent on non-front line costs. And for every pound of taxpayers’ money spent by DfID through multilateral organisations such as the UN and the EU, 5 pence of this goes to the administration of DfID. A further 15 pence (on average) then goes on the administration of the multilateral organisations. That’s a fifth of the money not directly helping the people it’s supposed to reach.

And it’s these external multilateral organisations that the Public Accounts Committee has warned against giving more funds to, as DfID had planned. If too much money is being spent on administration, it is only right that DfID must look to cut these costs. The Committee indicates that it is more transparent if DfID spends the money itself, rather than giving it to organisations such as the World Bank and the EU. It must not be forgotten that how money is being spent is important, as well as the total amount.

British aid undoubtedly saves lives across the world, and DfID’s work on crisis appeals is admirable. But it is vital that aid spending is transparent, so that taxpayers can be assured it is effective for those it is intended to help. Simply hiking DfID’s budget at a time when public spending needs to be brought under control does not guarantee greater efficiency and could mean more money lost to administration and fraud.