Edinburgh, Lothians, Borders and Fife Forum (ELBF Forum) - Collaboration and Shared Services Between Councils November 2009

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Edinburgh, Lothians, Borders and Fife Forum (ELBF Forum) - Collaboration and Shared Services Between Councils November 2009 Edinburgh, Lothians, Borders and Fife Forum (ELBF Forum) - Collaboration and Shared Services between Councils November 2009 1 Purpose of report 1.1 To advise members of discussions which have been held by City of Edinburgh, East Lothian, Fife, Midlothian, Scottish Borders and West Lothian Councils on an approach to collaboration, joint working and potential sharing of services between the six Councils. 2 Context & Background 2.1 Following the Council elections in May 2007, the six Councils in south-east Scotland agreed to establish a Forum as a vehicle to discuss and review issues of common interest. The Forum consists of the Leaders and Chief Executives of the six Councils. Meetings of the forum take place on a quarterly basis. 2.2 A key issue currently under review by the Forum is the significant financial pressures facing Scottish local government. The draft budget of the Scottish Government has confirmed that the public sector in Scotland will need to identify a further £500m of efficiency savings in 2010-11. Current indications are that there will be significant real term reductions over the period of the 2011-14 finance settlement. In addition, demographic shifts, changing customer expectations and investment requirements are placing increasing burdens on Councils. 2.3 The emerging financial position requires all Councils to review their existing service delivery arrangements and consider all opportunities for service modernisation, including the scope to deliver efficiencies through greater collaboration. 2.4 Strong operational and strategic links already exist between the ELBF Councils and Appendix 1 gives an overview of the wide range of collaborative projects that are already in place. This list is not exhaustive as numerous other partnerships exist (eg with the Voluntary Sector, Police Fire, Health). 2.5 In May 2009 the Forum agreed to explore new opportunities for greater collaboration between the neighbouring Councils. To assist with this work the following statement of intent was approved. “As a matter of priority it is agreed to identify and develop appropriate shared service models for the ELBF Councils. The project’s success will require a long term commitment, built on trust, collaboration and leadership.” 2.6 In order to structure this important work a number of guiding principles were identified: x service change would be underpinned by an appropriate business case, with a realistic assessment of all associated costs and benefits, infrastructure requirements, timescales and risks; x irrespective of any service delivery change, participating Councils would retain an appropriate level of control and oversight; x the exercise would recognise the need for transparency and fairness in relation to shared costs and benefits; x shared service proposals would take account of each Council’s strategic direction, policy initiatives and improvement plans; x all Councils would be required to play an important role in championing identified proposals; and x all activities would be supported by effective engagement with staff, elected members, trade unions, customers and the general public. 2.7 With the guiding principles in place a high level review of existing services was undertaken and the following candidate activities identified: x Mobile/Flexible Working; x Payroll; x Procurement; x Road Maintenance; and x Audit. A lead council was identified for each activity and, over recent months, officers from the ELBF Councils have been working together to explore and develop the potential for greater collaboration. The following section considers each work stream in detail and outlines future areas of activity. 3 ELBF Activities Mobile/Flexible Working 3.1 This work stream is being led by West Lothian Council and early work confirmed that the ELBF Councils are at different stages in respect of their commitment to, and development of, mobile working. There is, however, a general consensus that a strategic approach to mobile working would be beneficial and a range of opportunities have been identified: x Sharing Buildings – significant potential exists for staff to use flexible working facilities in other councils’ buildings; x Management Processes and Management Development – the successful deployment of mobile and flexible working will require a change in management culture. The potential exists to collaboratively develop performance management processes and training to support this new culture; x Benefits Tracking and Management – the benefits of mobile working are considerable e.g. property savings, increased productivity, carbon reduction, work life balance etc. It is essential that Councils are able to realise these benefits and scope exists to adopt a shared approach to tracking the benefits of mobile working; and x Support Mechanisms – traditional support services will need to adapt to the needs of staff working more flexibly. The potential exists to collaboratively develop or procure these supporting mechanisms (e.g. intranet, HR advice). 3.2 Given the considerable benefits that could be delivered through increased mobile and flexible working the ELBF Forum has recommended prioritising this activity. Future activity will focus on those areas with the greatest benefits and where technology already exists and capacity is currently being identified to undertake this work. Payroll 3.3 Fife Council is the lead authority for the payroll work stream and under their direction a high level review has been undertaken. It was quickly identified that the link between payroll and transactional HR is essential to effective internal control and operational efficiencies. Consequently, any potential collaboration should include payroll activities and the parts of HR necessary to deliver an integrated service. 3.4 A collaborative approach to payroll/HR services could potentially deliver significant benefits. While this activity is not without complexity, as a service common to all Councils and one that is readily specified, it is an area worthy of further consideration. The ELBF Forum has recommended that further analysis is undertaken and that a detailed option appraisal for payroll/HR activities is developed. This appraisal will identify and assess a wide range of credible service options eg joint improvement activities, a solution hosted by a lead Council, joint venture or strategic partnership with external suppliers etc. The appraisal model would also consider the benefits and risks associated with each model. Procurement 3.5 The City of Edinburgh Council has been working with the other ELBF Councils to establish the benefits of a procurement shared service. Initial discussions considered the strategic procurement service model that was developed as part of the joint pathfinder project involving the City of Edinburgh, Fife and Scottish Borders Councils. This model is now operational in Edinburgh, and Fife has restated its commitment to join the service (both Councils were recently involved in a joint recruitment exercise for key procurement posts). To date, the service has successfully focused on significant spend activities such as Learning and Care and other spend categories are now being assessed. 3.6 Procurement savings will continue to be a key focus for all organisations and willingness exists to drive forward procurement activities in a collaborative way. While Edinburgh and Fife are already working together, there is currently no specific call from the other ELBF Councils to formalise joint working arrangements. There is, however, significant scope to share best practice and Fife and Edinburgh will continue to actively engage with ELBF colleagues to develop mutually beneficial procurement arrangements. This activity could potentially lead to some form of ELBF partnership in the future. 3.7 Further work will also be undertaken to ensure that increased ELBF collaboration is complementary to the activities of Scotland Excel, the national procurement body, and Procurement Scotland. Road Maintenance 3.8 The road maintenance work stream is led by Scottish Borders Council and there is a strong sense that greater levels of joint working would be beneficial. This will potentially focus on sharing best practice, sharing equipment, providing staff to cover shortages in other areas, undertaking roads maintenance activities for other councils etc. 3.9 The infrastructure specialists, Halcrow, have been commissioned to undertake an independent review of service activities. This will provide a useful insight into the competitiveness and performance levels of existing Council activities and will assist the ELBF Forum to shape future review activities. Audit 3.10 Under Midlothian Council’s direction, a high level appraisal considered the scope for, and benefits of, increased collaborative working. This work identified that while cost efficiencies savings may be limited there are considerable benefits that could be achieved through greater collaboration (eg ability to respond to national initiatives, degree of flexibility, better understanding of trends, better co-ordination of activities etc). 3.11 The ELBF Forum recommends that audit services continue to share best practice and work together to build capacity and identify innovative new ways of working. This will include exploring different service models and developing common audit practices. These activities may lead to greater opportunities for a formal shared service in the future. 3.12 In addition to the specific shared services work of the ELBF Forum a wide range of other initiatives
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