From Firefighting to Financial Sustainability

Across the country, we’re hearing the same concerns from Section 151s, chief executives and service leads: in‑year overspends are persistent, savings are harder to deliver, and reserves are propping up budget pressures.

When Medium‑Term Financial Plans are creaking and the sentiment is “there’s nothing left”, the answer isn’t a bigger list of savings ideas, it’s a sharper way of finding and fixing the root causes across the whole council. That’s what a whole‑council diagnostic is for, and it’s why we run it at pace.

I’ve set out the questions below that I use to test whether a council is on a path to financial sustainability. These questions help teams move from symptoms to causes, from isolated projects based on preference to evidence-led, whole‑system change, and from optimistic spreadsheets to evidenced benefits business cases that support a sustainable MTFS.

1) Forensic diagnostic: get under the skin of demand, spend and pressure

The best diagnostics are forensic and practical: they combine cost-and-demand analysis, benchmarking, and service walkthroughs with frontline teams. Done well, they create a shared baseline, expose the drivers of growth in demand, volume, and spend, and turn insights into implementable opportunities that Services and Finance both recognise.

Questions to ask:

1. Demand and acuity in People Services
   • Which demand cohorts (by age, setting, need, complexity) have grown fastest over the last 12–24 months, and how does that relate to unit costs?
   • Is that growth impacting total volume, increased demand, change in case mix, or increased case duration? Understanding this to root cause will inform which approach can help mitigate that growth.
2. Unit costs and practice in People Services
   • • Where are unit costs outliers comparted to statistical neighbours, and is the this driven by market factors, specification, or decision making / practice?
3. Pathway effectiveness in People Services
   • For each demand pathway (e.g., ASC front door, TA placements, SEND panels), where do we see avoidable failure demand or rework, and what is the quantifiable impact?
4. Income and Charging
   • What proportion of the pressure is policy‑driven (eligibility thresholds, charging policies, rent/fee setting) versus operational?
   • Is the Council making commercial decisions relating to Fees and Charging, to ensure fee setting is full cost recovery, competitive in the private sector, or ceased if not commercially viable?
5. Getting a grip on Spend
   • Where are the areas of highest 3^rd party spend? And are your highest spend contract, providers, or services, undergoing regular performance review, contract management, quality assurance, and value for money reviews?
   • How many of your largest 3^rd party spend contracts have been extended without competition, quality assurance, or thorough performance / value for money review?

Why this matters in practice: in one London borough we identified 120 cross‑council opportunities, building validated business cases worth an additional £23–£32m over three years, over and above existing savings, by tracing cost drivers through end‑to‑end pathways and agreeing the evidence with Services and Finance together.

2) Coordinated transformation: deliver change as one council, not lists of projects

Diagnostics don’t deliver savings, delivery does. Councils that deliver financial sustainability quickly approach transformation as a single, coordinated programme with clear governance, a fit‑for‑purpose operating model, and clearly aligned enabling functions (finance, digital, procurement, HR, legal, comms). We’ve seen this approach help leaders overcome digital, delivery and finance issues while designing an operating model that makes the right thing the easy thing.

Questions to ask:

1. Operating model
   • Does your corporate operating model (decision making, accountability, spans and layers of control, corporate services) make delivery simpler or harder? Where do we need to redesign handoffs and responsibilities?
2. Single set of priorities
   • Do you have one council‑wide set of priorities, with transparent resourcing, interdependencies, and capacity planning? Or multiple lists competing for the same people?
3. Delivery governance
   • Do you have a single set of delivery governance that drives grip (decision‑making, removing blockers and risks, escalations), not just coordination—and is it fed by a live, trusted dashboard and reporting?
4. Aligning critical enablers
   • Are Digital, Data, Finance, Procurement and HR aligned from week one (not week 12), each with explicit owners and delivery SROs?
5.  Sustainability built in from the start
   • Are frontline teams co‑designing the change so the “new way” becomes the only way, with clear process, roles, controls, and performance measures included?

What this can unlock: we’ve sustained delivery through highly challenging contexts, supporting an authority under s.114 to deliver £14.5m savings in Adult Social Care over three years, equating to ~14:1 ROI, by coupling programme grip with embedded change capacity across operations and commissioning.

3) Benefits tracking: prove it, maximise it, and bank it in the MTFS

If I could fix one challenge sector‑wide, it would be this: treat benefits tracking as a financial control, not an afterthought. That means a transparent, council‑wide framework with baselines, named owners, reconciliation to the MTFS, and direct links to cost centres. We’ve built and implemented these methods so programme teams and finance colleagues speak the same language, see the same numbers, in the same place, throughout delivery.

Questions to ask:

1. Baselines and owners
   • For each initiative, do you have an agreed baseline, operational KPI, agreed financial impact, and a named owner in finance? Is the operational owner accountable to the same board as the PM?
2. Mapping to cost centres
   • Can you trace every £ of planned benefit to a specific cost centre and account code, with a timetable for when it will impact the bottom line?
3. Input vs output KPIs and controls
   • Have you agreed the input KPI that drives the financial impact? Can you monitor this so that you can evidence causality?
4. Reconciliation rhythm
   • Do Operations, Transformation, and Finance jointly reconcile delivery with shared language, visibility and understanding, to the MTFS, and is variance managed
5. Portfolio view
   • Can senior leaders see, on one page, the delivery status and impact on the medium‑term position? If not, the system picture is missing.

What “good” looks like in the first 90 days

• Set up for success. Confirm the diagnostic scope, data pack, governance and benefits framework up‑front; agree the single backlog structure and who owns what.
• Forensic analysis and validation. Blend cost/demand analytics, benchmarking and pathway analysis with Services and Finance to validate findings together, and avoid disagreements later.
• Convert insight to delivery. Stand up priority workstreams with clear TOM implications, embed enabling functions, and start monthly benefits tracking so improvements land in the MTFS on time.

We’re confident this can work because we’ve applied it repeatedly, from identifying whole‑council opportunities and designing the operating model, through to delivering multi‑year savings. These aren’t isolated case studies; they show what becomes possible when analysis, delivery and benefits control work as one system.

In Summary:

Financial sustainability isn’t about finding “the final list of savings.” It’s about building the muscle memory to diagnose the real problem, deliver as one council, and track benefits like you track cash. When those habits are in place, councils not only stabilise the medium‑term position; they create the conditions for better resident outcomes and a healthier organisation.

If this resonates and you want to compare notes, or test your current plans against the questions above, I’m always happy to have that conversation, please email me on tom.wheeler@peopletoo.co.uk