Local authorities with excellent performance ratings will be offered greater freedom in the management of social work jobs and services, according to a new report from the Treasury.

Total Care: A whole area approach to public services offers highly rated councils negotiable freedoms in areas such as ring fencing, flexible inspections or budget regulations. To qualify, high-performing organisations are being invited to submit an offer to the government, pledging to deliver better outcomes or better use of budgets for their areas.

These "freedoms" would run between 2011 and 2014. According to the report, each offer would need to be clear on the scale of potential savings, demonstrate the willingness of partners to participate and show how different group would share budgets or resources appropriately. These proposals are based on the Total Place pilots which ran in 13 areas across England and Wales, aimed at encouraging public agencies to pool resources such as qualified social workers or other services, for a "whole area approach".

In return, the number of targets for local authorities will be cut over the next two years and an estimated £1.3bn of local authority grants will no longer be ring-fenced by central government. David Parsons, the chair of local government association's improvement board, has welcomed the report. "Giving councils and other local service providers more freedom to get on with their job is the only way to improve services and save money," he said.

The Total Care schemes linked local care services, council workers and health workers to pilot possible improvements to care and cost efficiencies. Effectively people in domiciliary care jobs such as community matrons, work in active conjunction with social workers and GPs to improve preventative healthcare. In one such scheme in Suffolk, the NHS trust found that it made greater savings from increased access to qualified social workers than the council, and began investigating how it could provide extra funding.