The news that the London Borough of Barnet is not finding it easy to deliver savings is unsurprising.
All local authorities are going to struggle due to the size of savings required. What makes Barnet’s difficulties newsworthy is that it claims to have found the answer to delivering public services, while still operating within a reduced budget. Barnet has proudly boasted that it intends to be the first “easy council”. It will meet ambitious efficiency targets by providing no-frills council services, using the model of the low cost airlines.
However, councillors in Barnet have found that it is not so easy to make the size of savings required and not possible to do it by simply making efficiencies. They were, at best, naive to claim that they had a way of making savings without making cuts to frontline services; their pre-election claims were based not on rigorous appraisal options but on an unproven belief that council services needed a dose of private sector realism.
And yet they will not be the only public sector organisation facing up to the fact that they need to make large scale redundancies, service cuts, closures and have longer waiting lists. They will not be alone in finding that such dramatic cuts are unpopular but also that they will take a lot longer to deliver than anticipated. In the face of hostility from local media, stays of execution will be granted while options are considered; closures will be phased to give time for alternatives to be found; compromises will be agreed because politics is the art of the possible - and frankly the original plans were, to all intents and purposes, impossible.
And then there are the efficiencies that never really existed, except on paper. The savings that allowed officers and councillors to claim that cuts to frontline services would not be necessary - the halving of absenteeism rates, the ban on over-time and the use of agency staff and better management of vacancies - and, of course, the total ban on the use of expensive management consultants.
All of this will also be true of NHS trusts.
What happens if the savings are not made? What would happen if over-ambitious efficiency targets resulted in a trust running out of money and being unable to pay its bills? Would new GP commissioning consortia bail them out? In this new business culture, can a foundation hospital actually go bust?