During negotiation of the Good Friday Agreement, it was suggested that sometimes "we all have to jump together". Having read through the Local Government and Communities Committee Report published on 28th January 2010 following an inquiry into Local Government Finances, this quote has particular resonance. While there is perhaps nothing new in the report, it is certainly timely as local government works its way through the budget setting exercise for 2010/11.
The report's key recommendations are a classic political crowd pleaser. Rather than suggest a way forward or some must do actions it proposes some further work here, some detailed analysis there. It warns against pushing for Council Tax rises, pay freezes, service outsourcing, but at its heart it recognises the reality for local government as it struggles to balance the books this year and sow the seeds for an even tighter budget setting exercise in 20011/12. Each of our 32 Councils must consider its own circumstances and priorities and make decisions on that basis – it has always been so.
The report is supportive of two areas, namely collaborative procurement and the development of shared services. Evidence from the NHS in Scotland – where the past few years have seen great developments in a national procurement strategy for goods and supplies, has demonstrated huge benefits both in terms of the unit cost of procurement for goods and supplies but also the timescales for those supplies. There is undoubtedly more that local government can do to cut the costs of procurement and leverage competitive benefits by collaborative procurements. Scotland Excel is there and can keep doing what it is doing and more. Collaborative procurement is politically easy – it doesn't change what you do or how you deliver your frontline services, or your back room functions for that matter. It gets you more goods and services for your public pound.
Shared services on the other hand are more difficult. I wholeheartedly agree with the report that shared services are not a silver bullet - they will not take away the budget problem. They can be part of the solution. The Arbuthnot Review gives much food for thought and there seem to be some quick wins and perhaps easy paths through some of the legal concerns that have been raised over the spectre of shared services. The Arbuthnot Review identified roads maintenance and repair as an area ripe for a greater degree of cooperation and collaboration. Tayside Contracts, which was established to retain the economies of scale and operational efficiencies of the Tayside region, stands alone but others have considered the idea of a public/public partnership between neighbours when the Scottish Executive outsourced the Trunk Road contracts. The powers to create the Tayside Contracts vehicle are there, they are without challenge and from an outsider (albeit a regular user of the Tayside road network) and they seem to work.
Over recent years we have supported public sector bodies creating joint ventures, outsourcing services and working with the private sector in increasingly innovative ways. Each case must be considered on its own merits to ensure it is legitimate in terms of law. If the joint board route is considered too outdated and a corporate vehicle more favoured, then the well-being powers need to be considered in the context of a worked up proposal. Only then can officers and Councillors form a view as to whether they are acting appropriately. Challenges may come, and we know they have for Councils who have pursued the innovative, so Scottish Government action to put the matter beyond doubt would be welcome but not, I would suggest, a precondition to developing plans and proposals.
Shared services are a leap of faith. The prize might well be more effective and efficient service delivery and sometimes we all have to jump together.
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