Elected Member Briefing Note - Local Government Benchmarking Framework - Overview Report 2023-24

About this Briefing Note

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Purpose

This briefing note provides a summary of the Local Government Benchmarking Framework (LFBF) Overview Report 2023-24 and provides national and local contextual performance information.   

Briefing Information

The Improvement Service recently published the thirteenth annual report for the Local Benchmarking Framework. The National Benchmarking Overview Report 2023-24, shows the extraordinary effort and achievements delivered across local government against unprecedented financial, workforce and demand pressures.  

This briefing provides a summary of the key information from the report, including national trends, and an assessment on whether PKC is in line with those.  Strategic Leads have provided in-depth profile briefings for each themed area.  These also outline the impact of budget decisions and transformation projects on performance levels. These profiles will be shared with elected members under separate cover. 

It should be noted that information in this briefing represents a snapshot in time and some indicators may have changed since 2023/24. Officers and elected members can access benchmarking information at any time on the Improvement Service dashboard and metadata is also provided for each indicator which gives a definition of the indicator and any calculations used.  

The Accounts Commission has a statutory duty to direct councils to publish information that will enable comparisons of performance between councils and over time and also show how well they are improving local outcomes in partnership with other public bodies. The Commission fulfils this duty by issuing a Statutory Performance Information (SPI) Direction to councils. In 2024, the Accounts Commission published a new SPI Direction, which will apply to reporting of performance in the financial year 2025/26 onwards. The new SPI Direction expects councils to maximise the use of the LGBF as a primary means of facilitating comparisons, alongside or in conjunction with other locally appropriate measures of performance.  

Key Messages from the Improvement Service  

While this year's report shows the extraordinary effort and achievements delivered across local government against an increasingly challenging backdrop, it also shows how sustained financial, demand and workforce pressures have substantially disrupted performance and efficiency improvements gained in previous years. Councils are having to make increasingly difficult decisions about how they deliver services and what services may have to stop or reduce if they are to deliver balanced budgets.  In its latest review of council finances, the Accounts Commission also highlighted these intensifying challenges and the real risks for the future they present.  

Local government, as a sector, is taking clear pro-active steps to mitigate the effects of these challenges, through performance improvement and transformation.  While councils are clear on the urgent need for transformational change, they are mindful of the challenges faced in achieving this whilst also delivering vital services. The Accounts Commission has emphasised that this burden of transformational change should not fall on local authorities alone given the need for wider public service reform. 

Funding Pressures 

In 2023/24, revenue funding for councils was £12.7 billion, a 4.2% cash increase on the previous year but 1.8% lower in real terms.  Funding of local government has not kept pace with other parts of the Scottish budget for many years. While the budget for Health has grown by 20% since 2013/14, the budget for local government has fallen by 0.9% in real terms in that period.  

Where there have been uplifts in funding for local government in the last decade, almost all of this has been to fund new services and new policy priorities which have brought with them new demands which councils have had to meet. The Accounts Commission report that at least a fifth of funding provided in 2023/24 is ringfenced or provided with expectation it will be spent on specific services. 

Growing Demand 

Ageing populations, along with rising costs for every day essentials are leading to increased demand for services, particularly in statutory services like social care and housing. An ageing population means more people in our communities with multiple and increasingly complex needs relying on essential council services.  

The cost-of-living crisis has further increased demand for council services especially among the most vulnerable, at a time when councils have less capacity to support them. Deepening fiscal, workforce and demand pressures pose real risks to the future sustainability of vital services, including those that are essential in preventing and mitigating the effects of poverty.  

Further demand pressures are evident in the increasing growth in the number of pupils in need of additional support for learning, with a 41% increase since 2017-18. This is an area of increasing priority for the local government sector with councils working more closely than ever with partners to ensure children have access to the support they require to help them achieve their potential.  

Workforce Pressures  

Councils continue to face multi-faceted workforce capacity pressures including an ageing workforce, increased service demand, skills gaps, and recruitment and retention difficulties which are impacting on overall organisational capacity and resilience. Against this context, it is perhaps unsurprising that LGBF data continues to record increases in staff absence across the sector, particularly for reasons of stress, mental health and fatigue. In 2023/24, council staff absence levels reached the highest level ever reported. These rates of overall absence combined with high levels of vacancies in some roles will be impacting on councils' capacity to deliver essential local services.  

Adult Social Care Sector  

Councils and their partners face significantly growing social care demands largely due to supporting the increasingly complex needs of people with disabilities and an ageing population. Since 2010/11, the over 65 population has grown by over 26%, whilst the deepening crisis in workforce recruitment and retention is intensifying pressure. While adult social care is an area of expenditure growth, this is not keeping pace with demographic demands, and financial pressures from rising inflation, pay uplifts and Covid-19 legacy costs are making it difficult to sustain services at their current level.  

With a £4.1 billion shortfall in social care funding, service cuts have been necessary, making it increasingly difficult to meet statutory service delivery and public expectations. Resources are now focused on fewer people with higher needs, rather than early intervention. Despite challenges in shifting care out of hospitals, progress has been made in relocating support to homes and communities. This includes closing long-stay hospital care, moving rehabilitation services to community settings, and expanding primary and community care services. A commitment to a "whole system" approach to population health is needed, including investment in preventative and early intervention services to address social determinants of health. 

Local Government Financial Sustainability and Spending Decisions 

Councils' financial plans and spending patterns show a system under pressure and highlight the difficult decisions that are being required to deliver balanced budgets. To bridge the growing budget gap, councils are relying increasingly on recurring savings, increases to Council Tax, and the use of reserves. Budget performance trends also indicate a system under pressure, with actual outturn in 2023/24 at 99.6% of budgeted expenditure, which is the highest level since reporting began.  

Local government revenue expenditure has increased in real terms by 2% in 2023/24, and by 7.7% since 2013/14. This expenditure growth has been insufficient to keep pace with demographic trends. In 2023/24 alone there is a £6.5 billion shortfall in terms of the level of spend required just to keep up with demographic change and inflationary pressures.  

Expenditure Trends (Since Base Year, 2010) 

National  

Nationally, expenditure within social care, education, and support for care experienced children continues to be sustained and enhanced, growing since 2010/11 by 29%, 19% and 18% respectively. Meanwhile, increased and disproportionate savings are targeted on those areas which are not protected by Scottish Government policies to provide balance to statutory and ringfenced commitments elsewhere. Further trend information (since 2010/11) is shown in Figure 1, however the following are of particular note:  

• 26% reduction in culture and leisure spending  
• 13% reduction in roads spending  
• 25% reduction in planning spending  
• 30% reduction in tourism spending  
• 23% reduction in corporate support services spending  
• 30% reduction in trading standards and environmental health spending  
• 39% reduction in street cleaning spending  
• 11% reduction in waste service spending  

Local  

Locally, expenditure trends reveal that our pressure areas are similar to those highlighted nationally, but with a greater proportion of cuts to support services. Where nationally cuts have been applied to roads, this shows as an area of increase at a local level. However, this was following years of decline from 2017 and monies being significantly allocated to this area from 2020 onwards and reflects policy decisions to invest in our road infrastructure.  Proportionally there has been a greater change in expenditure in Looked After Children and Economic Development than at a national level, with a significant increase in expenditure in the latter from 2019 (including non-recurring external funding, such as the Tay Cities Deal and Employability).  Local changes in expenditure since 2010 are shown in Figure 1. 

Expenditure Trends in Most Recent Year  

National  

Nationally, in comparison to the most recent year (2022/23), although Social Care and Looked After Children are still protected, this is to a much lesser extent and Education shows a very slight decrease of 0.3%.  Conversely, services that have previously experienced cuts, such as Environmental, Roads, Planning and Support Services have all seen slight increases. 

Local  

Locally, the overall position is reflective of the national picture, with Social Care, Education and Looked After Children all having slight decreases in expenditure (1.4%, 0.7% and 1.1% respectively).  However, where nationally there have been slight increases to Environmental and Support Services, locally these continue to be areas of pressure.   

Performance Overview Since Base Year (2010) 

National 

Overall, the long-term picture remains positive, with 68% of performance indicators within the LGBF showing improvement since the base year. In recent years, however, year on year trends show a slowing in improvement and an increase in the number of performance indicators which are now declining.  In the last two years, the rate of decline has overtaken the rate of improvement (45% compared to 39% respectively). However, while the overall picture points to a slow-down in performance improvement, there are long-term improvement trends which have been sustained and strengthened in policy critical areas.   

Local 

Within PKC, since the base year, 52% of all indicators have improved; 38% have declined and 9% have remained the same since the base year. It should be noted that in the base year (2010) we were considered a very high performing council compared to the national average. However, the most recent data shows performance in line with the national position, in that we have also seen the rate of decline overtaking the rate of improvement in our most recent data (45% compared to 35% respectively). 

Summary of most recent local data (comparison with 2022/23) 

Performance Overview:  

There are 107 LGBF indicators with recently published data (2023/24 unless stated otherwise). Within this, there are 85 non-cost indicators (performance and satisfaction indicators), and 22 cost indicators. Locally we do not rank cost indicators as reduced costs do not necessarily mean improved outcomes for local communities.  

Within the most recent data for Perth and Kinross Council non-cost indicators, 32 (38%) performance indicators improved, 45 (53%) declined and 8 (9%) stayed the same from the previous year (2022/23). This represents less favourable outcomes and follows the national trend, with the rate of decline overtaking the rate of improvement.  Changes in improving/declining performance and performance against the Scottish average are demonstrated in figure 3. Figure 4 shows the breakdown of whether costs have increased or decreased in our most recent cost indicator data. 

Rank Positions: 

The Improvement Service rank all indicators in terms of their performance out of the 32 Scottish local authorities, then consider these in ranking groups, known as quartiles. Looking at how PKC performance indicators sit within these quartiles gives a sense of how PKC is performing in comparison to other local authorities. However, it is necessary to consider that legitimate variations in data will exist across councils due to local policy choices and demographic profiles. 

In the most current data, more than half (60%) of our non-cost indicators are in the upper two quartiles. This is an improvement of 5% to how we ranked last year.