Digital Transformation in Local Government: AI and Data Won’t Fix a Leadership Gap
Charlotte Whitehouse
Councils are no longer asking whether to use AI. A County Councils Network survey found that 85% of responding county and unitary councils have been using AI, with the other 15% considering adopting or trialling it. The more useful question now is why that activity isn’t adding up to digital transformation in local government at scale.
The evidence points the same way. It isn’t a technology problem, it’s a capacity and leadership problem, and local government reorganisation is about to make it more urgent.
Adoption Is Wide, But Maturity Is Uneven
A recent stocktake from the Local Policy Innovation Partnership, drawing on 101 published case studies, found that maturity varies significantly between councils, with the strongest emerging use in notetaking, transcription, drafting, translation and chatbots. These are useful, sensible applications. They are also not transformation.
The same report notes a lack of robust quantification of benefits, with the clearest gains in organisational efficiency and customer experience. A separate 18-month readiness study of 208 councils across the UK describes some of the most advanced councils operating alongside others at the very earliest stages.
So, AI in local government is a sector of pockets: pothole detection in one county, a transcription pilot in another, a chatbot in a third. What’s missing in most places is the connective tissue that turns experiments into change.
That means a clear owner, governed data and a credible plan for scaling what works.
What’s Holding Councils Back
The same barriers appear in almost every source:
- Capacity. Council leaders warn that staffing and funding constraints risk this AI revolution in local services running out of steam.
- Legacy systems and siloed data. Socitm’s view is that enthusiasm is growing, but councils are still working through legacy systems, siloed data and digital skills gaps.
- Governance. Researchers flag the risks of poor-quality outputs and shadow adoption of unapproved tools, which is what happens when tools move faster than policy.
- Procurement and skills. Staff understanding of AI varies widely, and the procurement of digital systems is a longstanding challenge for councils.
None of these is solved by buying another platform, as each need someone senior who can set direction, make trade-offs and hold suppliers and colleagues to account.
Data Is a Founding Decision, Not a Workstream
The most overlooked point in the debate is that data capability is an organisational question. As techUK puts it, data capability is an organisational question, not a technology project, and the new data architecture will shape what a council can do for a decade.
That matters because of reorganisation. The Government has confirmed, for example, that Lancashire’s 15 councils will be replaced by four new unitary councils from April 2028. Each new authority must decide how to merge fragmented data estates, rationalise suppliers and build a safe day-one technology offer.
The LGA is already commissioning workshops to support digital, data and technology leaders in councils affected by reorganisation to prepare for vesting day and beyond.
The choices made in these windows will be hard to reverse. Councils that treat data as something to sort out after vesting day will inherit the problems of every predecessor authority.
The Skills Question Is Really a Leadership Question
The LGA’s own research on reorganisation recommends, among other things, that councils foster strong digital leadership, ensure informed leadership, safeguard necessary capacity and value skills and capabilities. Localis reaches a similar conclusion, noting that the central role of governance and leadership will decide whether a digital dividend is realised.
The sector is responding. The LGA and Apolitical have piloted a digital excellence programme for senior officers that focuses on practical leadership judgement rather than technical skills, helping leaders navigate decisions around data, technology and AI.
That framing is right. A chief executive or director doesn’t need to build a model, they need to know which questions to ask, which risks to own and which trade-offs to make.
The people who can do that, with reorganisation, financial pressure and rising expectations all in play, are in short supply. That is why many authorities are recruiting senior digital roles, often on an interim or fixed-term basis to bridge the transition.
What This Means for Council Leaders
Three practical implications:
- Decide who owns the agenda before you decide what to buy. Transformation without a senior, accountable owner stalls between IT, service areas and the corporate centre.
- Make data decisions early and deliberately. In a reorganising authority, architecture and governance choices become founding choices.
- Be honest about capacity. Short-term interim leadership can protect momentum through the transition, provided it is planned alongside a longer-term capability build rather than instead of one.
How Practicus Supports Local Government
Practicus works with councils and wider public sector organisations on Search, Interim Management and Fractional recruitment including digital, data and technology leadership.
If you’re planning for reorganisation, building a new digital and data function, or covering a senior vacancy while you recruit permanently, get in touch.
Frameworks We’re On
Want to know more? Get in touch below
ABOUT PRACTICUS
You can find out more about us on the about us page
Check out our latest insights here:
- How to Reduce Time to Hire Without Sacrificing Quality
- How Dr Google Is Changing the Way We Seek Healthcare
- Driving Change: Tackling Public Sector Recruitment Challenges
- Why Psychological Safety at Work Is the Foundation of Wellbeing
- A Cross Functional Guide to AI in Pharma