How Participatory Budgeting works

Participatory budgeting directly involves local people in making decisions about the public money being spent in their community.

Every year your local council and also bodies like the Police, Housing Associations and the National Health Service (NHS) make decisions about what they feel needs doing to our communities and in making their budget they decide how to share out the public money they control to achieve those goals. Participatory Budgeting allows the citizens living in an area (or within a specific community) to participate in the debate about what needs to be done and take decisions on the allocation of at least some of the available public funding.

Just like your household budget at home, public bodies have to make plans that try to balance the books while investing in new things. That budget includes all the things they have to do, the things they should do, and the things about which there are choices.

Participatory Budgeting will work in different ways in different places to suit local circumstances. That is because each community is different. But there are a few basic rules to follow that will help to keep citizens in control.

Participatory Budgeting aims to increase public knowledge about how our taxes are spent. So information must be simple to understand, relevant and easy to get hold of. For example written in plain English, be up to date and in sufficient but not too much detail.

• Participatory Budgeting is all about local politicians and public employees being more accountable. That means discussions about the public budget should take place in the communities they affect, not behind closed doors.
• Participatory Budgeting is about making sure local people have a fair opportunity to have their say and make a real contribution. That means they are involved before decisions are made, not asked afterwards for their opinion. Everyone has a chance to be heard, and given the time they need and the respect they deserve to participate.

The people behind The People’s Budget have helped develop a particular form of Participatory Budgeting called ‘participatory grant making’. Rather than a small committee deciding on grants for community groups based on long written applications (which can be very boring and off putting particularly for smaller groups) all the bidders are invited meet up, make verbal presentations and then the whole audience votes in an open and direct manner. Lots of positive community development outcomes seem to emerge from participatory decisions like these. There are some great videos here that explain more.

Community and small scale grants are vital to local communities. So we are very proud of the good experiences we have observed since being involved participatory grant making. Now, we at The People’s Budget Campaign feel lots more could be done to open up the decision making about local grants.

The problem of concentrating on small scale grant making is a risk that citizens are still left out of bigger decisions. Keeping communities and community activists busy, whilst often the real power and the big money lies elsewhere isn’t always a good idea. That is why we decided to set up the People’s Budget website and promote this campaign.

So where is this big money, we hear you ask, and how do we have our say….We know every year public bodies spend millions of pounds in our name. They do this by a process of public budgeting known as ‘commissioning’. That is, deciding what services are important and then going on to buy those services on our behalf.

One important thing we’ve realised whilst looking at public budgets is that 95% of local public expenditure is beyond the direct influence of local people. Sometimes there are because of the rules imposed by central government on local authorities. Statutory responsibilities, employment contracts with staff and a host of regulations and laws place most public money beyond direct democratic influence by citizens.

We understand there are many good reasons for this. After all we don’t want our hospitals being run by amateurs who don’t know what they are doing. Or for one vocal part of the community to always get its way and receive an unfairly large amount of the money. So we elect local councillors and we pay professionals to help manage the more complex problems for us. That is what a representative democracy does well most of the time. Saying local people can always have direct control over all public money is, we believe, not very realistic.

But about 5% of public expenditure every year is up for grabs, and not yet committed, so available to invest in new services or in new needs within the community. This ‘investment’ budget is where deliberative and democratic processes (like Participatory Budgeting) operate best, and where some real change becomes possible. The investment budget is also the fun bit. Where the opportunity to engage people meaningfully really does exist.

The ‘trick’ is to design strong decision-making processes that ensure that public investment isn’t captured by vested interests who naturally want to use it for their own benefit.

That’s where The People’s Budget comes in. Helping you design better Participatory Budgeting processes that will work in your community to empower citizens.