Beyond balanced budgets. Is your council actually resilient?

If you work in local government finance, you already know the headline figures by heart. Three-quarters of English councils drew down reserves to balance their 2023–24 budgets. Two-thirds expected to do it again the following year. More than half now fear a Section 114 notice within five years. What used to be an exceptional failure is starting to look like a systemic norm.

Faced with that, most of us reach for the same instinct: tighten the numbers. Freeze spending, trim services, find the one-off saving. It stabilises the position — until next year, when the same pressures return a little heavier and the room for manoeuvre is a little smaller.

A new report, Resilience in Practice: A Toolkit and case studies for local government, makes a simple but uncomfortable case: a balanced budget is not the same thing as a resilient council. You can have healthy reserves and still be fragile — if no one owns the savings plan, if planning functions are siloed, if leaders read the same risk in three different ways. And you can be flagged as "at risk" on the metrics while quietly having the culture and coordination to cope. The report's answer is the Government Financial Resilience Toolkit (GFRT) — and it's worth your attention.

The bit the index can't see

Most finance teams are familiar with CIPFA's Financial Resilience Index. It's a genuinely useful diagnostic: reserve levels, external debt, reliance on central funding, the share of spend tied up in statutory services. It tells you where you might be exposed and whether you're an outlier against your peers. What it can't tell you is why. It doesn't see organisational behaviour, governance capacity or leadership culture. It doesn't capture how your council actually prepares for and absorbs a shock. Two councils with identical numbers can respond to the same pressure in completely different ways — and the difference usually lives in the things a spreadsheet can't measure.

That's the gap the GFRT is built to fill. It's grounded in years of academic research into how local governments survive austerity and crisis, and it organises resilience around three lenses:

• Perceived vulnerability — how your people actually interpret risk. Not the objective pressure, but whether leaders read it as an existential crisis or a manageable challenge. That interpretation shapes the tone and urgency of every response that follows.

• Anticipatory capacity — how well the organisation sees trouble coming. Horizon scanning, critical thinking, open information sharing, cross-service collaboration.

• Coping capacity — what you can draw on when a shock actually lands. Adaptability, speed of decision-making, internal and external coordination, the ability to learn from last time.

The insight that runs through all of it: when perceived vulnerability is high but anticipatory capacity is weak, councils default to short-term retrenchment — cuts, freezes, firefighting. When vulnerability feels manageable and the underlying capacities are strong, councils can do the harder, better thing: redesign, adapt, "bounce forward" rather than just bounce back.

GFRT has already been road-tested

This isn't theory. The report follows two English district councils through the full journey of adopting, implementing and using the toolkit. They took deliberately different routes, and the contrast is where the practical lessons live.

Council A went broad and decentralised: senior leaders nominated participants across every department, backed up by drop-in sessions, an internal FAQ page and direct encouragement from heads of service. Passive channels — the newsletter announcement — barely moved the needle. Personal, visible support did. Seventy-eight people engaged; 53 completed it across all departments. The team exported the data into Excel, started spotting departmental trends, and took the findings to their SMT, where the CEO endorsed repeating the exercise with everyone next time.

Council B went targeted and structured: around 30 named individuals from the corporate and senior management teams, introduced in a single in-person briefing. Cleaner oversight of coverage — but a thinner explanation up front, a rollout that collided with the school holidays, and participation framed as optional, all dampened uptake. Twenty of the 30 completed it. Their honest reflection: the lack of early framing created sensemaking barriers, and a one-off run takes real effort to interpret without support.

Two different organisations, two different approaches, one shared conclusion. As one Council B project leader put it, the tool let them see "where we might not be talking the same language" — and could "help steer the ship." A Council A leader described it as a prompt to "think differently about how we approach work, how we cope, how we don't cope, how we anticipate."

What this means for you

The report distils a clear roadmap any council can lift and adapt:

• Frame it as reflection, not audit. Use briefings and personal engagement, not just written notices. People engage when they understand it's about perceptions, not a test of technical knowledge.

• Democratise participation. Pull in voices across departments and hierarchy. Empower internal champions, coordinated by a project leader.

• Lower the friction. FAQs, the freedom to skip questions or start with the easy sections, and clear reassurance that no documents or prior prep are needed.

• Use the data early. Don't wait for a formal report. Informal dashboard exploration is what builds momentum.

• Plan the conversation that follows. The value is in the structured reflection after the survey closes — turning divergence into action.

• Build a cadence. Run it alongside the budget cycle, agree a short action plan with named owners and dates, and repeat it to track how perceptions shift over time.

And crucially: use it with the index, not instead of it. The index tells you where you might be exposed and how you compare to peers. The toolkit tells you why, and what to do about it. Together they give elected members, audit committees and management teams a genuine 360-degree view — and they shift resilience from being "the finance department's problem" to a matter of collective leadership.

That combined view matters more than ever with reorganisation on the horizon. Restructuring reshapes roles, governance and informal networks faster than the numbers can show — and the loss of institutional memory can hollow out coping capacity even while the org chart looks stronger. A tool that captures real-time internal insight lets you see resilience eroding early enough to do something about it.

Read the report

Uncertainty is now the baseline, and the financial pressure isn't easing. The opportunity is to stop treating each year's gap as a fresh fire to put out, and start building an organisation that can see pressure coming, absorb it, and keep delivering.

Resilience in Practice: A Toolkit and case studies for local government sets out the framework, walks through both case studies in detail, and gives you a step-by-step roadmap for running the GFRT in your own authority.

If your council is balancing the budget but you're not sure it's truly resilient, this is the report to read — and the toolkit to try.

Explore the toolkit at www.financialresiliencetoolkit.com.