Innovative Councils: Embracing Entrepreneurial Mindsets for Local Growth 

With rising demand, stretched budgets, and a shifting policy landscape, councils must think creatively about how they deliver for their communities.  One idea, once more prominent in previous decades, is making a comeback: ‘municipal entrepreneurship’.  

This approach is about councils being proactive, innovative, and commercially minded. It’s not through short-term fixes or commercial ventures, but by reimagining how local government operates and unlocking new opportunities for local prosperity. 

This isn’t a new concept, it’s embedded in local government’s DNA. From 19th-century innovations in clean water, public transport, and social housing, to the municipal ownership of energy companies, land, and even banks, councils have a long tradition of stepping in where markets fall short and where communities need leadership.  

What’s changed today is the context and the urgency. Councils today face acute and structural financial pressures, compounded by increased cost of living, devolution, stretched council budgets, climate change, and social inequality. These are the conditions in which entrepreneurial thinking thrives: scarcity, a need for agility, and a drive to do more with less. For local authorities, adopting this mindset means embracing the challenge, rather than retreating from it. 

Unlike private businesses, councils have a unique combination of powers and influence. They shape local planning and infrastructure, convene stakeholders, manage public land and assets, and deliver critical services that touch every resident. This puts them in a powerful position, not only to respond to local challenges, but to shape the future of their communities.  

It’s about taking proactive steps to deliver on local ambitions whether that’s building homes, driving inclusive growth, or tackling inequality. There are already strong examples of this in action. In Hull, Kingstown Works Limited, a council-owned company, delivers building maintenance and repairs across Hull and the East Riding. Since 2008, it has returned over £3 million in surpluses to Hull City Council, demonstrating that public ownership can achieve both high-quality services and financial return. Meanwhile, Calderdale Council played a key role in the revival of the Piece Hall, providing partial funding for its restoration and helping transform a Grade I-listed historic site into a thriving cultural and economic asset. This is what modern-day local innovation can look like: strategic, place-based, and rooted in local value. 

Key principles for ambitious local government leaders: 

1. Conditions Are Tough, But Not Impossible
   Yes, resources are tight. But constraints can be a catalyst for creativity. Councils with an entrepreneurial mindset find solutions where others see dead ends. They ask: how can we do this better, differently, or more collaboratively, experimenting with new models, building coalitions, and unlocking latent value in underused assets. 
2. Reimagine Service Delivery
   Entrepreneurship isn’t just about setting up trading companies or investing in commercial property. It’s rethinking how core services are delivered. Can partnerships with social enterprises improve outcomes? Can technology streamline frontline services? Councils have an opportunity to redesign services that are not only efficient but more responsive, resilient and people-focused. 
3. Risk with Purpose, Govern with Care
   Risk is inherent to entrepreneurship, but in local government, it must be purposeful, proportionate, and well-governed. Past missteps in speculative investment highlight the need for strong governance, clear outcomes, and public accountability. 
4. Use Your Levers Wisely
   Councils have the regulatory, planning, and economic development powers to shape markets in favour of their citizens. Whether using land to promote affordable housing, leveraging planning policy to support local jobs, or guiding private investment into community priorities, local government has both the legitimacy and tools to be a driving force for good. 
5. Focus on the Community First
   The most effective local initiatives are rooted in place. They listen to communities, respond to local need, and deliver real, visible benefits. This isn’t about copying the private sector, it’s about applying entrepreneurial thinking in service of the public good. 
6. Collaborate to Multiply Impact
   Councils don’t have to go it alone. Collaboration with other councils, the private sector, local institutions, and communities themselves, can scale ambition and reduce risk. The most effective public innovators build partnerships that align values and multiply impact. 

This is more than a strategy, it’s a cultural shift. It means embedding a new way of thinking and working across the organisation. It takes leadership, a willingness to learn, and the confidence to experiment in pursuit of bigger goals. Local government has always been capable of transformation. History is full of councils leading the way in everything from housing to health to environmental reform. Today, this spirit is needed again. The challenges may be great, but so is the potential. 

By embracing their unique position, adopting a confident and outward-looking mindset, and reimagining how they serve their communities, councils will shape a more resilient, inclusive, and vibrant future. This isn’t about becoming more like business, it’s about becoming the best version of local government.