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Central government’s steering of municipalities (2016:24)

On behalf of the Government, Statskontoret (the Swedish Agency for Public Management) has conducted a survey of central government’s overall steering of municipalities and carried out a comprehensive analysis of the consequences of this steering.

Central government steering has increased

Statskontoret’s assessment is that central government’s overall steering of the municipalities has increased in scope, complexity and degree of detail in recent decades. There are many agencies steering municipal operations, and some areas are also subject to steering from the EU. New forms of steering have emerged, including agreements, action plans and knowledge management. Steering by means of specially allocated state subsidies has also increased. Municipalities have also been assigned new areas of responsibility, such as providing housing for newly arrived immigrants who have received a residence permit.

The municipal politicians and officials who were interviewed are in agreement as regards their view of central government’s overall steering. They perceive this steering to provide something explicit to relate to as they implement municipal operations, but the steering is also described as short-term, stop-and-go and unadapted to local conditions.

At the same time, Statskontoret notes the difficulty in giving a comprehensive description of central government’s overall steering, which in turn makes it difficult to assess the overall effects of this steering. One of the reasons for this is that steering is directed towards different levels in the municipalities.

Central government steering is most tangible in the areas of schools and social care

Of the municipal managers who responded to Statskontoret’s survey, nearly 95 per cent believe that central government’s steering has increased both in scope and degree of detail in the past ten years. It is above all the major municipal areas of schools and social care that are affected by central government steering. These areas have a large number of regulations, special supervisory agencies and a large number of state subsidies.

While overall steering has increased, there are individual areas of operations where it has decreased. This is true of the area of rescue services, which has moved towards management by objectives instead of management by rule, and of the area of culture, with its introduction of the cultural collaboration model. Statskontoret’s survey shows that central government steers the various municipal operations to different extents and with different policy instruments.

A current challenge is the large number of asylum seekers and newly arrived immigrants, which has resulted in a rapid increase in demand and in requirements for various kinds of municipal services and housing. In some cases, it has been difficult in a short period of time to employ people with the necessary skills. Asylum reception, which is primarily a central government responsibility, has increased requirements for municipal service in the municipalities that have many people living in refugee facilities. This is not least true of municipal schools, which often require special resources for children living in refugee facilities.

Some operational areas are steered by many agencies, which places demands on coordination

Some areas of municipal operations, such as physical planning, emergency preparedness and health and environmental protection, are steered by several central government agencies. In several of these areas, municipalities perceive there to be a lack of coordination between the responsible agencies. This can lead to additional administrative work for the municipalities, for example, when multiple agencies request similar or different types of follow-up information. Lack of coordination can also contribute to municipalities making different regulatory interpretations and different trade-offs between various objectives.

In the area of social care, central government has sought to strengthen coordination through measures including the formation of the Council for knowledge-based governance.

The County Administrative Board plays a role in many areas. This might involve exercising supervision, issuing regulations and providing advice and support, as well as coordinating central government initiatives within the counties. That the resources and skills of county administrative boards may vary has been mentioned as a problem within several of the operational areas studied.

Specially allocated state subsidies affect municipal priorities

Many municipalities believe that the design of state subsidies leads to them setting reactive and short-term priorities that are not always consistent with their needs and opportunities. Planning at municipalities can be complicated by what some of them perceive as an unpredictability in terms of if or when a decision on a new state subsidy will be made. Many, mainly smaller municipalities, say that they do not have time to plan for meeting state subsidy requirements and therefore miss out on all or part of the subsidies.

If the subsidy relates to employing personnel for a particular operation, there is a risk that municipalities will have to finance the salary costs when the state subsidy ceases. Many smaller municipalities are therefore cautious about financing ongoing operations with state subsidies that are not assessed to be a permanent source of financing. This means that state subsidies – perhaps contrary to their purpose – might increase the differences in quality between, e.g. smaller and larger municipalities.

State subsidies are perceived to be a strong policy instrument, especially in terms of school operations. Most of the school heads interviewed believe that targeted subsidies make it possible for operations to hold on to their funds so that the subsidies do not disappear into the general municipal treasury. However, several of the school heads interviewed believe that it is not worth the effort to apply for state subsidies. In relation to the administration required by the subsidy, they argue that the subsidy is often too low. This is particularly true in small municipalities.

The types of problem that the municipalities highlight with respect to some of the specially allocated state subsidies are well known and have been the subject of various studies. For municipalities, it is of course easier to manage a general and permanent state subsidy than a targeted state subsidy. A general subsidy can be used freely in the same way as municipal tax revenues, requires no particular administration and makes planning easier. Against this weigh the Riksdag’s and the Government’s objectives for subsidies to influence operations in a certain direction.

Heavy administrative burden in some areas

Several municipalities point out that the follow-up and documentation requirements in the area of social care are extensive. The Council for knowledge-based governance is running several initiatives to reduce this administrative burden. These include coordinating the regulations and general advice of the agencies concerned, but the agencies’ documentation requirements will also be coordinated.

The cost retrieval related to specially allocated state subsidies is considered to have an especially heavy administrative burden. Municipalities primarily mention subsidies within the areas of schools and migration.

A survey by Statskontoret has examined how employees in central government, municipalities, county councils and the private sector perceive employeeship and leadership at work. The survey shows that employees in municipalities and county councils to a higher extent  believe that administration takes time away from important duties, compared with central government and the private sector. Municipal employees are also those who most tend to agree that they spend more time on administration than what is reasonable.

Supervision and follow-up increase administration

Many municipalities believe that they are imposed with excessive requirements for follow-up and the reporting of data to central government.

For example, supervisory visits from the Swedish Schools Inspectorate entail a great number of hours spent on preparations, receiving the visit and subsequent work. As regards social care, several municipalities highlight that control in connection with supervision often focuses on processes, regulations and formalities rather than on quality and user needs. Supervision is perceived to be too focused on control rather than on operational development. The knowledge management model can also result in greater requirements for documentation and follow-up.

Central government steering presupposes broad expertise in all municipalities

Central government steering and the demands placed on municipalities are mainly the same for all municipalities, and steering is largely general for all municipalities. This is essentially based on the principle that municipal operations are to be uniform and be provided in an equivalent manner all over Sweden. This means, however, that all municipalities must have many different types of expertise. Some operations require specialist skills, and others have special staffing requirements in terms of skills and level of education.

The conditions for recruiting and financing the necessary expertise vary from municipality to municipality. It can be especially difficult for smaller municipalities in rural areas to maintain this expertise in all areas. One way to manage the skills requirements is collaboration that allows municipalities to share expertise and resources in certain areas.

Micro-management can affect municipal skills provision

Statskontoret’s overall view is that central government exercises extensive micro-management of how municipalities conduct their operations, albeit with variations between operational areas. Our survey shows that municipal needs and priorities regarding certain skills might look different and might not always be consistent with general steering. In several contexts, municipalities identify the specially allocated state subsidy for raising teacher salaries as particularly problematic. This initiative is considered to affect opportunities to recruit not only teachers but also many other key skills in the municipalities, whose salaries might be affected by those of teachers.

Many municipalities also see the increased responsibility for school heads as a problem. With the Education Act stipulating the powers of a school head, municipalities have less opportunity to steer school operations. A discrepancy between resources and responsibility arises in the municipalities, and this can have an impact on their recruiting and priorities. School heads end up in a situation of increasing responsibility without, however, having any direct influence over the budgetary priorities in their municipalities.

Micro-management can reduce the scope for staff to act

In reducing the scope to take independent initiatives, a high degree of micro-management can affect the opportunity to utilise existing skills and experience to design operations. It can also reduce the scope for adapting operations to local conditions and needs. At the same time, central government might have a need to micro-manage operations, in order to increase their equivalence, for example. Micro-management can also serve to ensure compliance with safety levels and various technical requirements.

Among the municipalities we have interviewed, it is mainly the steering of how operations are conducted that is considered to limit the opportunity of employees to design operations. Several municipalities point out that central government steering has an excessive focus on process metrics and quantity rather than on results and user perceptions. As a result, staff place too much emphasis on formal requirements for processes instead of quality development based on operational results or user needs.

Knowledge management opens up for greater influence from different professions

Knowledge management aims to change working practices and methods so that operations are based on research and proven methods. A significant part of this knowledge management directly targets different professions and categories of staff. Our survey shows that knowledge management is used in several areas of municipal operations, such as schools, social care and emergency preparedness. However, the implementation of knowledge management varies. In social care, steering has an emphasis on interaction, i.e. the involvement of responsible authorities and professions in the development of knowledge together with central government actors. In emergency preparedness and schools, knowledge management follows a more traditional top-down steering from central government agencies.

EU membership has led to a greater number of more detailed rules in certain areas

The EU primarily influences areas in which municipalities do not themselves conduct operations but act as the supervisory agency. EU membership has contributed to a greater number of more detailed rules in these areas.

Interviews with municipal representatives have revealed that they do not think about whether steering comes from the EU. This might be due to the fact that many EU rules and guidelines are incorporated into national regulations.