New APSE and NLGN research: ‘Better business: Councils shaping markets for public value’
15 October, 2014

Local councils urged to do more to shape private markets for public value.

Two influential local government think tanks have called on local authorities to lead the way in encouraging businesses to work better to develop more socially responsible practices.

In a new research report ‘Better business: Councils shaping markets for public value’, which was commissioned by APSE and written by NLGN, the organisations argue that whilst local businesses can bring valuable social, environmental, and economic benefits to local places, some private sector markets are failing to meet social needs and creating negative outcomes relating to ill health, financial vulnerability, and poor educational attainment which are picked up by local public services. Whilst national governments have a clear role to play in fixing these, local intervention can be preferable, or complementary, to a wider national approach.

Speaking at the launch Paul O’Brien, APSE Chief Executive said

“From energy pricing through to fast food outlets, local councils and other areas of the public sector pick up a cost created by irresponsible or poorly regulated markets. Whether it is issues relating to fuel poverty, or obesity related to poor diets, a cost is created on an already overstretched public purse.

“Whilst most councils have a good relationship with business, and positively encourage vibrant local economies, the damage created by irresponsible business practices can’t be ignored. This report calls on councils to use a range of tools at their disposal to challenge businesses. From simple measures such as collaboration with business and encouraging behaviour change amongst residents, through to more strident interventions such as the use of enhanced statutory powers, councils can be much more effective in ensuring that they help to develop responsible business practices in local areas.”

Simon Parker, Director of NLGN said

“The private sector creates jobs and growth, but some companies have adopted business models which push costs onto the public sector. At a time of unprecedented austerity, councils need to seek innovative new ways to give citizens better choices, so they are not forced to rely on overpriced payday lending, expensive consumer credit and inflated energy bills. Formal regulation and prohibition should remain the weapon of last resort; the best local authorities are setting up their own businesses to play the market at its own game and return a sustainable profit.”

The report provides a range of positive recommendations to enable councils to nudge or ‘budge’ business towards more socially responsible products and business practices. It outlines the opportunity for
councils to:-

  • Support new socially beneficial entrants to the market or provide of goods and services themselves to put competitive pressure on the private sector and retain the capacity for choice in service delivery
  • Rethink use of council assets and buying power to regulate within the council domain
  • Make the case for councils to have the freedoms to better regulate local markets to support national policy objectives
  • Scale up market shaping activities and make these much more effective through greater use of insights from behavioural science
  • Demonstrate strong political leadership to take effective action locally

The report launch will take place at 5pm on Wednesday 15th October at Hub Westminster, London
New Local Government Network (NLGN) is an independent think tank and collaborative network of leading edge local authorities and dynamic private sector thinkers. They connect members of the network to each other through a high level events programme and creative research work.

The Association for Public Service Excellence (APSE) is a not-for-profit local government body working with over 300 councils throughout the UK promoting excellence in public services. APSE is the foremost specialist in local authority frontline service provision in areas such as waste and refuse collection, parks and environmental services, leisure, school meals, cleaning, housing and building maintenance and energy services. APSE leads a research programme exploring a range of issues which impact upon both local authority frontline services as well as strategic public policy issues.

To arrange for interview or a press pack please contact Mo Baines at APSE ( or 0161 772 1810) or report author Maia Beresford at NLGN ( or 0207 148 4605).

The report can be purchased from APSE priced at £20 for APSE members and £40 for non-members. Email for details.