West Somerset to become ‘virtual authority’

And so it begins. For those who think elected members should be culled, here’s the answer, just get rid of the council and give it to the private sector!

Copied from Local Government Chronicle online
6 December, 2012 | By Ruth Keeling

Minsters have persuaded a council branded ‘unviable’ not to pursue a merger with neighbours and instead becoming a “virtual authority” commissioning services from other providers.

West Somerset DC has rejected LGA advice to commence a boundary review following a meeting with local government minister Brandon Lewis during which he made it clear he believed the authority should continue as a sovereign democratic body.

According to West Somerset’s account of a meeting held last month between Mr Lewis and the council’s chief executive and leader, the ministers endorsed the LGA view that the authority was “not sustainable” in its current structure but insisted there was “no need to engage with the Boundary Commission on the subject of a merger” as advised by the LGA.

He also warned the authority that it should not expect the local government settlement due later this month to solve the council’s problems, the report states.

Mr Lewis was of the “firm belief that the council should be retained as a democratically elected and accountable unit of local government representing the people of West Somerset”, according to West Somerset papers published on Wednesday, a stance in direct contrast to an LGA report published last month which stated “the council is not viable as a unit of local democracy and governance over the long term”.

‘Virtual authority’

Following Mr Lewis’ advice that West Somerset work closely with neighbours and become a commissioning council, a business case is to be drawn up with neighbours to investigate how the council can commission from “other service providers whom would predominantly, but not exclusively, be neighbouring councils”.

Under the fledgling plan the council of 82 full time employees would reduce its workforce further and “only retain a small nucleus staff to manage the commissioning arrangements once in place”.

The report to full council, due to be debated next week, states the council’s existing lack of capacity will “impact on the council’s ability to move forward with the necessary urgency” and, as a result, £25,000 has been set outside to employ outside expertise.

In setting out the objections to other options, the report notes that a boundary review would be unlikely to be completed before elections in May 2015, as recommended by the LGA, and argues that a large council tax increase was a short term solution which would be unlikely to win the support of the electorate in a referendum.

A business case for the move to commissioning is to be drawn up “as soon as possible” with the council’s own risk assessment making it clear that, if no action is taken, it is “possible” the council will be unable to balance next year’s budget. It also states it is “likely” ministers will identify West Somerset “as a failing authority and put intervention measures in place”.

Shared management arrangements with Taunton Deane BC and Sedgemoor DC were investigated in 2010, after an earlier report also questioned the viability of the council, but the proposals were abandoned in early 2011 partly because the cost savings were minimal. Other shared service ventures were pursued, however.

Ministerial advice

The West Somerset papers, which set out in detail the pros and cons of the options available ahead of a full council meeting to be held next week, also reveal that Mr Lewis’ recent advice contradicted advice given by his predecessor Bob Neill.

At a December 2011 meeting with Bob Neill “the advice given at the time was to seek local support for a council tax increase that was above the national threshold or seek a merger with a neighbouring council through the Boundary Commission”, according to West Somerset.

However, a Department for Communities & Local Government spokesman disputed this suggestion.

“It is wrong to suggest government has changed its views. In December the local government minister [Bob Neill] made no proposals for boundary review, he raised concerns over possible council tax increase specifically that government could not countenance large increases and said it would be supportive of a shared service approach,” the spokesman said.

“The important thing is that West Somerset is looking to ensure that they have a sustainable approach to the financing of their council and should be actively looking at the scope for joint working to make sensible savings.”

The report also said the view of the LGA had “seemingly changed” since its report said a boundary review would be necessary in the long term. A spokesman for the LGA said it stood by the advice given in October based on information available at the time, but that it supported West Somerset in pursuing alternative options following discussions with other parties.

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READERS’ COMMENTS (1)

Roger | 8-Dec-2012 12:36 pm
This council is being led down the garden path by this minister, for reasons I cannot currently fathom.
It may be that he is following the Pickles plan of decide and conquer when it comes to this government’s wish to see local government reduced to no more than a parochial puppet of central government. This would also align with this government’s obsession with everything private. Conning this council into becoming no more than a front for a totally outsourced solution, that can then be touted around as the way forward for all councils, is also a possible goal.
Can somebody please explain to me what the role of the elected member is in an organisation where everything is totally contracted out and therefore offers little or no flexibility without throwing more money at the issue? Every complaint would elicit the same answer, sorry, it’s in the contract. I suppose they would only ever need to turn up for the quarterly performance reviews, followed by the annual contract review.

Outsourcing – buyer beware?

Here is an interesting item on the potential pitfalls of outsourcing.  Although it refers to the information technology systems (most people think of this as ‘the computers’) it could easily be applied to all other areas where outsourcing is being looked at as option.  I found the statement about contract negotiation particularly noteworthy, as this is where every level of government, not just small local authorities, seem to be found lacking to say the least – put crudely, they all too often seem to get stitched up by the private sector!

“Outsourcing is good and delivers economies of scale however the process is a major commitment and a path filled with risks, according to a latest briefing from Scotim Insight.

The “Costs of Outsourcing – uncovering the real risks” presents a detailed analysis of the outsourcing process and the risks it brings to local authorities.

According to the document, the risks begin at the tender stage. The supplier is well versed in contract negotiations on outsourcing while a smaller local authority is rarely going to be in that position.  So, the briefing suggests that councils seek professional advice around framing and negotiating a contract.

It also urges councils not to put all their eggs in one basket. Rather than transferring all ICT operations as a bundle to one supplier, it is best to break them into components and go to market individually.

often as a result of outsourcing, in house talen is lost which leaves the organisation unempowered against a well versed supplier.  It is equivalent to the naïve householder faced with a plumber who takes a sharp intake of breath, asks ‘Who did this?’ and then presents a large bill. In these circumstances, urgent jobs may be done only at an excessive margin, as the supplier seeks to recoup profits lost through the typically hard-fought and costly competitive tender process.

Socitm Insight suggests that identifying the potential savings to be expected from an outsourcing deal by benchmarking in advance the cost and satisfaction with the existing service against the best performing ICT services and writing the difference into the specification could be a good starting point.

‘Outsourcing should not be considered an inevitable response to austerity’ says Martin Greenwood, author of Cost of outsourcing. ‘Even smaller organisations that need to gain economies of scale, and struggle to keep up to date with technological development, should consider collaboration and sharing with other local public services as a genuine alternative. If they do take the plunge into outsourcing, they should make sure they are aware of the pitfalls and know how to avoid them.’ ”

Source: eGov monitor – A Policy Dialogue Platform
Published Wednesday, 4 May, 2011 – 10:02


I’d like to be in America!

I’d like to be in America, everything’s ‘private’ in America……..

Excuse my shameless abuse of the words of the song, but it seems to be appropriate to the thinking of Bury Borough Council.  See Independent article link below.  It makes very interesting reading for all of us in local government, as do some of the readers’ comments below it.

http://www.independent.co.uk/news/uk/politics/bury-privatising-public-services-2255631.html

Hiving everything public off to the private sector and repatriating the business rates to ‘free’ local government from the central grant system, has a very American feel to it – and not in a good way.

I continue to be disappointed that the existing local government machine cannot figure out how to more closely align itself to the way the private sector does business, so as to survive the turmoil that is being imposed on it by central government cuts.

Obviously part of it will be about the terms and conditions that have become so favourable in local government in recent years, compared to the private sector.  It may be that we need to go through this ‘destructive’ phase in local government, in order for those who continue to defend this model to ‘wake up and smell the coffee’ as they say. 

However, we also need to consider if it might only possible to recruit people with a public service ethic, when you make the pay and conditions more favourable that they are in the private sector.  I suppose the Holy Grail for this aspect is the volunteer, that extraordinary person who is not only driven by a need to help others, but is also willing to do it for nothing!  The alternative to this ideal, is that you accept the profit driven model and along with it the potential for a somewhat different attitude to public/customer service.  

The problem with culling from local government all those who joined because they saw public service as a noble cause and replacing them with those whose only gaol is the bottom line, is that it is then almost impossible to go back to the good old days.  There has been some talk of the John Lewis model working in local government, but this still requires employee buy-in based on profit sharing and would still need those currently in local government to accept, initially at least, reduced pay and conditions of service.

Even more worrying for local taxpayers, is the spectre of continued and increasing conflict between central and local government, as more councils change colour from blue (and the occasional yellow) to outraged red.

Big Society – if the price is right

David Cameron is refusing to give up on his Big Society idea, with a speech tomorrow (Monday) to remind people of what it’s about.  One TV commentator was cruel enough to inform viewer that, if this were a film launch, it would be billed as Big Society 4.

I can’t help but wonder if David Cameron hasn’t already missed the boat on this in terms of public attitude?  How many volunteer led activities have folded in recent years, because of a lack of people willing to give up their time?  Scout, Guide and Brownie groups, along with numerous social clubs and community run halls, to name but a few.

Surly, if there were so many willing people out there, wouldn’t they already be doing it?  What is it about Big Society that’s going to bring all these potential volunteers out of the closet?

Even if it does succeed, this drive to turn us in to a nation of volunteers, (now that we’ve pretty much killed off all the shop keepers) has its fair share of negatives.  Just like his ministers, David Cameron seems hell bent on subjecting this country to a local government bypass operation.  It’s as though councils are being blamed for all the ills in our communities and that bypassing them to recruit a new set of volunteers, will somehow bring these communities back to back to health.

I say new set of volunteers because central government seems to have forgotten that local government already has a large number of volunteers.  They’re called elected members and they were put there by their communities.

Until the last government started interfering with the process, local government was very much something you got involved in because you wished to make a contribution to your community and were willing to make some financial sacrifices in order to do so.  Now, with the advent of members’ allowance and special responsibility payments that often run in to the tens of thousands, the clarity of this aspect of being an elected has become decidedly blurred.  Given the Pickles drive to cull local government senior and middle management and give the job to the members, this blurring can only get worse.

My second gripe about the Big Society idea, is that many of the charities that are apparently going to become the saviours of everything the public values, are often run like full blown businesses.  Many have chief executives and senior managers employed on a purely commercial basis, with pay packets to match.  I doubt if these people agree to take a reduced salary just because it’s a charity that’s employing them.

So, as with elected members, the public service ethos of volunteering to provide a service to communities, will become more and more blurred over time, as the big charities and their army of well meaning volunteers burrow their way in to the various local government service delivery areas.  As we see more and more services transferred from the stewardship of one set of elected volunteers and into the hands of those who are unelected and therefore far less accountable, a major question comes to mind.

Unlike those employed in local government, the senior management of the big charities bring none of the public service ethos that is currently present in local government, but do display much of the commercialism of the private sector.  How long will it be before it is impossible to tell the difference between a service delivered by a ‘charity’ and that delivered by an outsourcing company?

Not a major problem in itself you might think – who cares who delivers the service, as long as it’s delivered?  The problem is, once you’ve killed off the competition, in the form of the current local government structures and the only providers in the market are the privateers, it becomes a sellers market.  The defence industry has already done this via the MOD, now it would seem that it’s the turn of local government.  Come on Down The Price Is Right (for those old enough to remember the TV show).