The announcement by the Convention of Scottish Local Authorities (Cosla) of a review into the future of local service delivery is the latest step in Scotland's public sector facing up to a very different future.
What has been clear for several years is that public services of all kinds - local authorities, NHS boards, police services and more - can no longer rely on the budgets that previously existed.
The president of Cosla, David O'Neill, argues for a greater emphasis on localism. Regardless of the outcome of the inquiry in the spring, it will be a useful exercise as our public services continue to adapt to operating in a massively changed world.
Political arguments aside, the UK and Scottish governments face budget constraints on an unprecedented scale. That in turn impacts on how Scotland's public sector bodies must approach the challenges in their respective areas.
No longer can public services increase spending to improve housing, child protection, healthcare and so on. Reducing spending has been central to the Coalition Government's plan to reduce the UK's budget deficit, although Scotland has been protected from the brunt of the cuts to date.
While most economic indicators provide encouragement that the private sector is experiencing a convincing return to growth, public services can look forward to no similar boon. What has not dwindled with budgets is the demand on public services; quite the opposite. The bare fact is this: public spending over the past decade has increased at an incredible pace, in Scotland and the rest of the UK.
The level of spending is unaffordable. When the state pension was introduced early in the twentieth century, the average life expectancy was 48 years. Now it is 81. In Scotland, the introduction of free personal care increased the cost of these services to local authorities from £219 million in 2003/04 to more than double that, £458 million, in 2011/12. And Scotland currently has the second-highest public spend per head in the UK at £10,088. If we look ahead even another 50 years, when today's 30-somethings will be in their 80s, the implications are clear.
While the challenges for Scotland's public services remain significant, there are bright spots. Our latest State of the State report, drawn from detailed conversations with public service leaders throughout the UK, shows an optimism that budget constraints provide as much of an opportunity to innovate as an obstacle to overcome.
All of this points to a long-term challenge for public services that cannot be remedied by reining in budgets in the short-term. While a few years of spending cuts can help balance the books, only a fundamental reshaping of public services will help meet demands in decades to come.
The kind of deep reform required has already started. Police Scotland, formed from eight regional police forces, and the Scottish Crime and Drug Enforcement Agency were created earlier this year, on the same day as Scotland's eight fire and rescue services also merged. The reforms aim to save £1.7 billion over the next 15 years. Leadership skills are an ever-more critical element of public service delivery. There is a sharper focus on performance management, hiring the right people with the skills for the job, and engaging staff in the necessary change underway rather than simply imposing it. This crucial as staff morale is vulnerable and delivering the public services required needs an engaged, committed workforce.
The knock-on effects of welfare reform, the health of local economies and ageing populations are yet to be fully understood, so a "new" public service has to be sufficiently adaptable. That is the nub of the issue. We have had several years of what history will probably judge as a short, sharp tug on the public spending reins.
Public service leaders are responding with a determination to capitalise on the opportunity to reshape Scotland's public services for the complex challenges ahead.
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