Councils worry experts with potential property bubble
The Local Government Association (LGA) has re-launched its national map of shared services, revealing a massive increase in shared service agreements between Local Authorities – and a significant rise in cost savings.
Saving the pennies
In 2012, there were 220 shared service agreements in place across England. Since then another 194 have been set up, saving participants an extra £297m. In total there are currently 416 shared service agreements in operation, delivering combined savings of £462m.
Of that total, nearly a third of the financial benefits have come from merging back office services (£146m). That amounts to nearly double the savings made by sharing procurement and capital assets (£79m) and customer-facing services (£75m).
Widening the net
Although savings are skewed to the back office, the new map reveals that councils are widening the net in the search for savings. In particular, LGA data reveals a significant rise in councils sharing adult services, procurement services and capital assets. Savings were even found in children’s services and housing, suggesting that no sector is off limits.
The innovation of local authorities in cutting costs is to be applauded, and the rise of commercialism seen not only in such shared service agreements, but in decisions to rent out spare office space and use economies of scale to benefit from outsourcing consistently reveal resourcefulness in the face of adversity.
Yet it’s hardly surprising that councils are looking further afield to save money when, as LGA Improvement and Innovation Board chairman Peter Fleming has been quick to point out, “savings from shared services simply do not match the scale of the 40 percent funding reduction councils saw during the lifetime of the last Parliament.”
That’s why we believe it’s important to focus on maintaining a healthy cash flow too. That means ensuring that shared service agreements are monitored, costed and/or invoiced quickly and efficiently, but also that debts like the £4.55bn of unpaid council tax and business rates in 2013/14 are claimed wherever possible. And an experienced service provider like Dukes Bailiffs can help.
We work with numerous councils across England to liaise with debtors and seek amicable repayment plans to suit both parties, minimising the burden on stretched local authority staff and recouping much-needed funds.
For more information about our services, contact a Dukes Bailiffs advisor today.