The deficit you can see is not the deficit you have
Most leadership teams I have worked alongside know the size of their budget gap to the pound. The finance team has done the work, the figure is on the spreadsheet, the board has been briefed. And in almost every case, the real number is bigger. Not because anyone has got their sums wrong. Because the deficit an organisation can see is rarely the deficit it has. I see it in councils, universities, and the regulated industries we work with. The shape is the same.
This is not a criticism. Organisations under sustained pressure rarely have room for the structured look at the whole estate that would reveal the full picture. Whether the pressure is a funding settlement, a regulatory shift, or a change of leadership, the people doing the work know better than anyone that visibility is the first thing to go.
The new Local Government Finance Settlement is the version playing out most publicly right now. £83.5bn in 2026-27, rising to £90.5bn by 2028-29. The first multi-year settlement in a decade. None of it, on its own, will close the gap the Institute for Government has identified: spending power in 2028-29 still 2.7% below 2010-11 in real terms. What councils do with it, and what every leadership team facing a similar gap takes from it, is the question.
What the visibility gap looks like
In Wales, one council has answered that question. We worked alongside Caerphilly County Borough Council from 2023. They began with an assumed deficit of £37m. Six weeks of structured discovery, looking at projects in flight, supplier contracts, spend patterns and demand, revised the figure to £45m. By the end the real number was £65m.
The deficit had not got worse. It had got visible.
That progression is the pattern, not the exception, and not confined to councils. Most large organisations run on a partial view of themselves: hundreds of live projects with no single owner, suppliers whose products are half-used, processes built around an operating model nobody has revisited in a decade. Each is a place where money is leaking. None shows up on the budget gap.
The organisations succeeding are not the ones with the cleverest savings plans. They are the ones that have put the whole operation in a single view, then made decisions against that view, in public, at pace.
This is not an efficiency conversation
The word “efficiency” has done damage to this conversation. A decade of austerity made it shorthand for cuts made by people who could not see what they were cutting. That is not what this is.
Visibility is not a precursor to cuts. It is a precursor to choice. Caerphilly banked £20m in 18 months on a £1.9m investment, with £34m more identified for the years ahead. The savings were a by-product. The primary output was the ability to make decisions on evidence, in forums where the trade-offs were visible to everyone.
This is also why technology alone will not rescue any organisation under pressure. An organisation that cannot see itself cannot use AI well, rationalise its platforms, or tell whether automation is removing waste or just speeding it up. See the work, then change the work, then automate what remains. The order matters in a council. It matters just as much in a bank.
What this means in practice
Wales has a policy environment built for long-term thinking. The Well-being of Future Generations Act asks public bodies to consider long-term impact and work with communities. Across sectors, organisations are being asked to plan further under tighter constraints.
Three things have worked.
- Spend the first six weeks looking, not cutting. A short, structured discovery is the highest-return six weeks a leadership team can spend.
- Consolidate before you prioritise. Bring the work into a single view and the priorities reveal themselves.
- Make the work visible to the people accountable for it. The organisations moving fastest are the ones where the work sits in the open.
None of this is new. It is what good delivery has always looked like, harder than it sounds under the pressures most organisations now absorb. The teams that do it will be the ones the next three years reward.
Reference:
The full Caerphilly County Borough Council case study, including the detail behind the figures cited here, is available alongside this post.
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