2. Invest to Prevent Future Need

Now the election is upon us in the UK, conversations about cutting public sector services will begin in earnest. These will not be happy conversations. Many children and families will receive less support. Many people will loose their jobs.

In the next few weeks we will contribute to this conversation with suggestions about how to introduce efficiencies and improve child outcomes.
 
But before we get to that discussion we want to encourage policy makers to invest to prevent future need. At first glance it might seem a crazy proposition. Does it make any sense to ask local authorities to make new investments at a time when they are slashing others?
 
Let us first explain the rationale. It stems from what we call the Parker-Loughran paradox. Roy Parker is Professor Emeritus at the University of Bristol and a Fellow of the Centre for Social Policy at Dartington. He and his colleague at Bristol Frank Loughran looked at the relationship between expenditure on children’s services and the economic climate over a 100 year period. As sometimes happens with well done studies answering a well thought out, simple question, the results are at the same time both hugely surprising and obvious.
 
The state spends more on disadvantaged children during economic upturns. And it spends less on disadvantaged children during economic downturn. So when there are more needy children, there is less resource available.
 
There is no reason to think it will be any different during this economic downturn. But it needn’t be the same. Let us make a proposal for local authorities wanting to take an alternative course.
 
How big will be the cuts in children’s services in each local authority? Let us pluck a figure from the air. Twenty per cent over the next five years. In other words if a local authority department of children’s services is spending £500 million per annum in this financial year, by 2015 it will have £400 million on which to call. This is the horrible truth that faces most local authorities.
 
What if the local authority were to institute a 21 per cent cut, with the extra one per cent being snipped off from year one. This would leave just £395 million to spend each year after 2015. But in the process the local authority has created a war chest to which £5 million would be added annually. Over five years that adds up to a healthy £25 million. Twenty five million doesn’t sound a lot in a world where there will be more unemployment, greater stress on families, and less support for kids in schools and the community.
 
But what if that £25 million is allocated to an invest to save portfolio of evidence based prevention, early intervention and treatment programmes? For example, £5 million spent on a school based intervention like Life Skills Training might reasonably be expected to reduce drug, alcohol and substance abuse for about 140,000 adolescents. And it would also produce savings to the local authority and state services of about £69 million. Or £5 million allocated for Family Nurse Partnership would improve parent and child outcomes for about 800 teenage mums.
 
Before we get worried about spending so much on school age parents, let us also add to the mix a saving to local and central government budgets of about £14 million. Of course, to get the real benefit the local authority children’s services will want some certainty that the money it saves will come back into the war chest for future re-investment in evidence based cost beneficial models.
 
The result will not compensate for the pain of losing £20 million each year from the overall budget. But it could make the pill easier to swallow. And it could alleviate the impact of the Parker-Loughran paradox by preventing increased need during the economic downturn, intervening early when problems first emerge and offering evidence based solutions when they solidify.
 
Plus, from a human standpoint, the strategy might create at least a small space for optimism and innovation in what promises to be a rather dismal time for children’s services policy makers, managers and practitioners.