Improvement Services shared: costs spared? An analysis of the financial and non-financial benefits of local authority shared services Appendix 6: Review of South Oxfordshire District Council and Vale of White Horse District Council shared services arrangements Contents Executive summary 3 Introduction 6 Shared services background 7 Set-up consolidation benefits 10 Wider business change benefits 13 Third party services 17 Strategic developments 18 Executive summary South Oxfordshire and Vale of White Horse For example, revenue and benefits claims District Councils agreed to share services accuracy has risen in Vale of White Horse in 2008. The arrangement has delivered from 79 per cent in 2008/09 to 93.3 per cent significant benefits. Total employment cost in 2011/12. savings between 2007/08 – 2011/12 from the shared service arrangements were £5.69 Council tax payers in Vale of White million, with an upfront investment cost of Horse have benefitted from the shared £1.79 million, delivering a net employment arrangements as the alternative options cost saving of £3.9 million. would have included cuts to services, reduced staff capacity and possibly higher Further budgeted savings of £4.92 million are council tax and other charges. Council tax forecast between 2012/13 – 2013/14. These at the Vale of White Horse is the 14th lowest are planned to come from improvements in England with the average home paying in waste and recycling contracts and in £116.69 in 2010/11. improved business processes, IT and reductions in staff through the Fit for the By sharing senior managers and staff, the Future (FTF) transformation process. councils work more closely together and benefit from a stronger Oxfordshire presence, Given the pressures on local government with greater operational resilience. For finances and the prospect of further example, a co-operative approach is evident reductions in Central Government funding, in Didcot with joint work on housing growth these sums are significant for both district and the associated Great Western Park councils. A strong focus on continuous development, the single largest ongoing improvement means that both councils see housing development in England, the the existing shared services as the starting planning for Science Vale and in the Central point rather than the end game. Government allocation of an Enterprise Zone in the area. This has significant potential Although the councils did not undertake to support both councils’ financial tax base detailed analysis on the expected impact of through business rates, council tax and the the shared service arrangement (SSA) on new homes bonus, and provide jobs and non–financial measures, service delivery, housing for local people. performance and customer satisfaction have not suffered and, in many cases, have improved. Services shared: costs spared? Appendix 6 3 Both councils are similar in scale and The change process was initiated by a demographics and the administration centres simple but direct joint business case, which, are not too far apart. The willingness of once agreed, was robustly and speedily the two sets of officers and councillors to implemented. The key initial drivers were collaborate has been critical. the reduced management costs arising from sharing services. Once this was delivered, This was important initially in finding out an iterative approach increased the level and whether the shared arrangement would and depth of the shared arrangements. could work. Latterly it has been important in creating and sustaining the service once Both councils have identified some key established. It is clear that both councils learning points from their joint experience in considered the ‘bigger picture’ and were developing shared arrangements, including: prepared to put aside purely local interests ‘for the greater good’. • Making an active choice between progressing with implementation or It was vital for both Chief Executives and the waiting until all supporting areas such two political leaders to work well together as Information and Communication to steer the shared arrangements through. Technology (ICT) are in place. The Agreeing a shared management team took councils chose the former option and time, with South Oxfordshire initially more implemented the shared arrangements hesitant. At any one time, any of the political quickly. As a result, during 2010/11 and and managerial leaders could have easily 2011/12 there was some operational derailed the process. Both councils were disruption. For example both councils had able to lay aside worries about ‘sovereignty’ separate ICT platforms and staff have had and ‘takeover’ to secure the aim of to contend with issues such as file sharing greater integration. Part of the success is between the two administrative centres. undoubtedly the willingness of councillors to Since April 2012 these have largely been set the direction and then allow their senior resolved. managers to ‘manage’ the process. • Ensuring that necessary decisions about The speed at which shared arrangements the selection of operating systems in were introduced was seen by politicians technical areas such as planning, building and senior staff as critical. Fearful of regulations and environmental health are legacy processes and negative mind-sets, taken as quickly as possible. Delayed managers worked hard on the ‘culture’ by decisions have impacted on the proposed changing behaviour and labels, favouring shared arrangements for some services. firm and clear interventions to reduce staff • Job evaluation [JE] was a bottleneck as numbers rather than prolonged uncertainty. many new roles at shared service manager They achieved the set-up of the shared and below were created, and some JEs services over a very short time-scale. were delayed by the limited number of trained evaluators. 4 Services shared: costs spared? Appendix 6 • This has caused some, but not significant, delays in putting in place the shared arrangements. There was also a decision to do all future evaluation of jobs on one council’s grades, pending a future project to harmonise pay. There is a need to ensure effective planning and implementation including, training more people to do JEs to minimise delay. • Agree important Human Resource details as early as possible such as the policy arrangements, terms for officers travelling between the administrative centres and hours of working. This provides certainty for staff and harmonises the different arrangements that previously existed. • Agreeing key joint corporate policies in relation to issues such as procurement and standing orders. Some delays occurred while agreement was reached as to which council’s policies joint officers should comply with. • Ensuring sufficient management support is available to minimise any negative impact on the well-being of staff, especially when workloads are very high. • Making time for senior managers to be able to listen to the concerns of staff affected by redundancy and uncertainty. However, consultation needs to be balanced against the desire of most staff for a speedy resolution to employment decisions. Third party income opportunities were not a key motivator or immediate priority for the SSA. However, the councils are now examining opportunities for generating income by providing services to other public sector organisations. Services shared: costs spared? Appendix 6 5 Introduction The purpose of this Local Government This was supported by several face-to-face Association (LGA) research project is to interviews. Those interviewed were: substantiate but not audit a selection of five established and successful local government Councillor Ann Ducker shared service arrangements. The research Leader of South Oxfordshire District provides the sector with important evidence Council and numerical based analysis on the success Councillor Matthew Barber of the projects in terms of financial returns Leader of Vale of White Horse District and service delivery. The main themes Council explored were: the efficiencies achieved so far, the impact of shared services on David Buckle customer satisfaction and outcomes; the set Chief Executive, South and Vale up costs and timescales for delivery and the extent to which the outcomes have varied Anna Robinson from initial business cases. Strategic Director, South and Vale South Oxfordshire and Vale of White Horse Matt Prosser are a natural choice for an evaluation of Strategic Director, South and Vale shared services between district councils. They are one of the longest standing Steve Bishop and most comprehensive shared service Strategic Director, South and Vale arrangements between district councils Andrew Down in England. In mid-2008, building on the Head of Service, ICT, HR and Customer success of earlier joint working in revenues Services South and Vale and benefits and waste, councillors decided on rapid steps to move to a joint Chief Clare Kingston Executive and shared managers down to the Head of Service, Corporate Strategy third tier. This process occurred between July South and Vale 2008 and February 2009. Subsequent moves extended the situation so that today, nearly William Jacobs all posts in both councils are shared. Head of Finance South and Vale The analysis in this report is based on Geoff Bushell documentary evidence provided from both Service Manager, Shared Performance, councils, including financial information. Projects and Customer Services Manager 6 Services shared: costs spared? Appendix 6 Shared services background Both district