Case: The City as a Listening Government
After decades of industrial decline as a port city, Sefton faced 50% in budget cuts at a time of rising social needs following the 2007–8 financial crisis. Instead of resignation, city leaders and officials responded by reinventing the city government as an equal partner to residents and community organizations, working together to help the community thrive, creating a promising model for the participation of citizens and social entrepreneurs.
This is the blog version of Cities and Social Entrepreneurs: A Playbook for Catalytic Change that I wrote in collaboration with Manmeet Mehta and David Lubell, published by Ashoka and Catalyst 2030.
Here is how it happened. A story in three Acts.
Act I — Remove a Meal to Improve a Meal
Faced with severe budget cuts, Sefton chose to partner with community organizations to reinvent, rather than eliminate, their community meals service.
In 2012, Peter Moore was given an unpleasant job to do. He was a social service commissioner in Sefton, a city of 275,000 next to Liverpool in the UK. The city could no longer afford to provide its community meals service, which brought hot meals to about 350 vulnerable, mainly elderly, people in the city. It cost the city about $300,000. The local council asked Peter Moore to cut that cost to zero.
Many families in Sefton were already facing really hard times. Sefton used to be a rich city with a big industrial port. As you walk through the city, you can see the docks, where most of the workers in the city would have earned their living for generations. It clearly had been a thriving community. Fathers and sons working side by side in the docks for decades. The port meant more than work, it is an inseparable part of the soul of the community.
But then, starting in the 1970s, slowly at first, the port lost its importance. Jobs were cut, unemployment rose. Families lost their income and young people had no job prospects. In 1981, in nearby Toxteth, thousands of desperate people protested and rioted against racism and poverty. Margaret Thatcher, the prime minister, wanted to free businesses from having to deal with workers they no longer needed. She wanted to put the economy firmly on the Fast Lane of globalization. Many families in Sefton were the problem left behind.
By 2012, when Peter was tasked with the job of saving money to deliver food to 350 of the most vulnerable homes, things were dire again. Not only had families lived through almost forty years of decline, but now the global financial crisis had hit them also. Once again, families in Sefton found themselves suffering from a major global event that they had nothing to do with. The docks were already gone, unemployment was high. In 2010, to respond to the financial crisis, prime minister David Cameron determined that the country would face austerity for years to come. Austerity means spending less. In the case of Sefton, it meant cutting about half the money the city could spend to provide its services. Community meals for the most vulnerable was just one of many services to be cut.
Peter’s assignment came at a time when his government already could no longer keep up with helping families in Sefton. Child poverty, poor health and unemployment were rising fast. Many families had to make very tough choices like choosing between buying food or heating their homes in winter. And here he was tasked with cutting the spending on hot meals for some of the hardest hit. Peter’s hope was to not just take something away from people, but somehow find a way to not let them down.
Here is how community meals worked. People who needed meals had to pay $5 per meal to the city.
The city had an agreement with a food company to provide those meals. In all, the city spent $300,000 per year on top of the $5 per meal people paid. So he began investigating what people really needed. He found out quickly that the food they were providing was actually quite terrible. Everyone got the same meal. But by talking to people he also found out that the delivery of the meal, for many, was the only human contact they had. So, they were afraid of losing this small interaction, even if it was just “Hi there, here’s your dinner”. He decided to start with a more basic question: What do people using this program really need?
Peter reached out to all kinds of organizations in Sefton to see if they could help. Volunteers helped and visited the users of community meals in their homes, to find out what their needs were, not just the food. They also connected them to other activities and services in Sefton that fit their needs. Peter and his team went out to talk to other local food businesses that deliver hot meals, for example to offices. Forty businesses signed up to provide meals at similar cost. Now people could choose from forty menus instead of getting the same old meal every day. To make sure things went well, the partners trained food providers to understand the special needs of vulnerable people they would now be serving. By the time Peter was done, he had saved Sefton the $300,000 he had to cut. But Sefton had also secured the food supply, made community meals better, and connected users to other community services for social contact.
Act I — Take Aways
“Cities always have alternatives even in the most dire circumstances, like austerity measures. Peter shows how municipal officials, if given time and support from their leadership, can find creative ways of achieving meaningful outcomes.”
“Have a methodology for problem-solving. Peter succeeded because he used the commissioning framework, a practice widely adopted by cities in the UK, that takes a holistic view of all resources in the community to organize better public service outcomes.”
“Treat your residents and volunteers as equals and withstand the top-down temptation at times of crisis. Peter sought input from service users and volunteers from the outset, which was the secret to creating better outcomes with no budget.”
Act II — Reinventing a City Hall
Faced with severe budget cuts, Sefton chose to partner with community organizations to reinvent, rather than eliminate, their community meals service.
Paul Cummins, a city councilor in Sefton, was Peter’s boss at the time. Paul is the political leader responsible for social services. For more than ten years, in an effort to find three hundred million dollars in budget savings, Paul and his team applied the same tactics of involving residents at every step and empowering them to find creative solutions. This way of empowering people and looking for creative solutions gradually changed the way the whole city worked.
For example, when the city had to cut twenty percent from the 24 million dollar budget for supported living services, a program that provides cooking, cleaning, shopping and personal finance support to six hundred people with special needs, they brought both service providers and users into the process. They worked together to not only cut spending, but also to create a shared vision of how to save money while maintaining residents’ independence where it mattered most to them. Sefton also groomed local nonprofits to bid against corporate service providers the city had used in the past, in order to have more affordable options based right in the community.
When asked what this intense period felt like to him, Paul responded: “My party, the Labour Party, took over Sefton City Council in 2012. Politically, we were opposed to the central government’s austerity campaign, which had painted local governments like Sefton as lazy and wasteful. It was a political nightmare. And a moral nightmare because so many people were suffering. But we took that frustration and turned it into a mission to invest ourselves in making the best of a situation we knew we could not control.” Peter chimes in. “It was really exhausting work, we were all pushed to our limits. Especially because we had to be creative whilst carrying so much responsibility for vulnerable people.”
Despite cutting so many services, Paul’s team got re-elected. Voters seemed to buy into the new model of being transparent about hard realities and involving people in implementing cuts. “None of this would have been possible without voluntary organizations in Sefton. We realized, much like Peter did with the community meals, that these organizations are very close to the people who need support and understand their needs best. In the beginning, we did budget cuts the old ‘patriarchal’ way. What I mean is that we, the public leaders, sat down and decided what to cut. That’s how government used to work, it was part of the power we held. But quickly that changed to working with everyone to make sure that we would put the little money we had to good use. And it completely changed how the city does its business, how the whole government worked.”
Sefton provides at least three valuable lessons, not just for city halls facing severe budget cuts. The first is to accept changing realities quickly. Sefton’s leaders showed humility early on, knowing that a top-down approach to running government would not be a viable response to growing and complex challenges. By choosing to involve the community in difficult decisions, local governments can share the burden of services while creating a powerful political narrative of local strength.
The second lesson is to protect exceptional public servants, like Moore, from becoming demoralized. Their entrepreneurship, creativity and moral compass is critical to maintaining service levels, and as Moore told me, it’s exhausting work. Their efforts need to be recognized, both to boost them and inspire others.
Finally, instead of working with big outside companies that promise to be fast and cheap, cities should think more carefully about whom they contract with. If the key to getting through hard times or solving difficult challenges is listening and learning from people, then cities should have partners who do just that. Leaders should work with organizations and businesses who share their values and care for the community. Like social entrepreneurs.
Act II — Take Aways
“City leaders have a critical role to play, especially during times of crisis, to build morale and extend trust to stakeholders in a way that creates a safer environment for creative solutions.”
“Create a clear vision government, social entrepreneurs and residents can work together to improve outcomes in a city. Paul discovered that being upfront and involving city staff, volunteers and citizens de-risked the tough austerity measures both functionally and politically.”
“If the city government is serious about working with social entrepreneurs, it will need to go about contracting in new ways. Sefton shows how this transition can be managed, involving vulnerable residents along the way.”
Act III — A New Model For All
Other cities and governments have arrived at the same lessons and created a wealth of new practices to partner with social entrepreneurs and communities to transform outcomes and become more resilient.
The city of Wigan, also with a population of 170,000, had to cut 25% of its budget in 2012 to cover the fallout of the financial crisis, and launched a comprehensive transformation of its entire government, working with the community to prepare for years of economic hardship.
In Wigan, the terrible reality of austerity became a community project called “The Wigan Deal.” And it wasn’t just a government program, but a fundamental realignment to make the roles of funders, service providers and service users more collaborative. The Deal nurtured community assets and promoted self-reliance in the community. Its underlying philosophy was to make the community a real partner with the government and take an assets-based approach to services, promoting self-reliance. City staff and partners took up a collaborative approach to help each person unfold their potential as a capable citizen. By 2019, Wigan had successfully reduced its expenses, frozen council tax, kept services running, and improved the health and life expectancy of residents.
At the beginning of the program, Wigan, like many cities, shuttered most of its government-run community centers. But city leaders quickly realized that cost savings alone were not making the city more resilient, so they made other changes, too. As a result, Wigan re-invested a part of the savings into service contracts with 70 community organizations. These groups stepped up to provide a much larger variety of services than were previously available. In one case, Sam Broxton, a local resident, had the idea of taking over an underused building to operate a community hub. With support of the City, he set up a community interest company and received £120,000 (~$200,000) from the City’s Wigan Deal Communities Investment Fund. Located next to a tearoom, the Hindley Library & Community Centre offers a wide range of activities such as crafts, drama, health, and job programs. The center is largely staffed by volunteers.
Wigan succeeded by building close, more flexible relationships with citizens and investing in partnerships with collaborative community organizations. Being so close to the pulse of people’s needs and capabilities optimized the use of scarce resources. Like Sefton, Wigan also developed new techniques to make these partnerships work. In particular, it wanted more flexible arrangements with contractors. Today, for example, social care providers meet weekly with social and other public service leaders like the police, at neighborhood level to exchange experiences and prioritize actions for the coming week. As a result, residents receive more responsive services, with budgets and resources optimized based on needs instead of predetermined scopes. Further, the use of open-book accounting helped create transparency between the government and partners, who collaborate rather than compete for the allocation of budgets. Further, the use of open-book accounting helped create transparency between the government and partners, who collaborate rather than compete for the allocation of budgets.
Many of the lessons from Sefton and Wigan apply not just to budget cuts, but also facing other complex challenges. They created space for their staff to find room to look for alternatives and co-produce solutions with communities and social entrepreneurs. Importantly, they also provide practices as to how to truly see eye to eye with the partners they need to thrive. Power, funding, agency and respect have been thoughtfully re-allocated. Another small city in the UK, Southend on Sea, is training all its 1,800 local government employees to obtain the skills and techniques Peter Moore used to reinvent community meals in partnership with residents and community organizations.
Act III — Take Aways
“Help cities, including all stakeholders, develop a case for change and for opening to social entrepreneurs. Wigan and Sefton didn’t just deal with a live crisis, but used it as a moment to think deeper about their overall resilience.”
“What deal should cities make to signal a transition from top-down government to seeing eye-to-eye with residents and social entrepreneurs? How can cities create room to not just appreciate, but fund this kind of transition?”
“City officials need new skills and a new framework to guide their actions. Sefton, Wigan and Southend showed that such change is possible even at times of financial hardship and immense uncertainty.”
