Radical joint working plan to see four councils no longer directly employ staff

The Leaders of four councils have published a radical proposal for a jointly-owned local authority company providing services and acting as a single employment vehicle, a move that would mean that the authorities do not directly employ any of their own staff.

The proposition in a report and outline business case – A 2020 Vision for Joint Working – going before the Cabinets at Cotswold, Forest of Dean and West Oxfordshire District Councils and Cheltenham Borough Council at various dates next month is: “Four Independent Councils determining their own policies, priorities and decisions supported by a small number of expert advisors who commission and monitor services either from the private and voluntary sectors or from local authority owned service delivery companies.”

The report continues: “If approved, this could effectively lead to councils that do not directly employ any of their own staff, but rather, councils will jointly own a local authority company which would provide services and deliver outcomes in line with the wishes of each individual council.”

It is claimed that the proposition could deliver savings of more than £55m over a 10-year period, whilst enabling each council to “remain as independent authorities with their own elected councillors representing local people”.

The four authorities already share a number of functions, including finance, human resources and payroll. They received a £500,000 grant from the Government in April to help with their work on further strengthening their shared service arrangements.

The report described the creation of a single employment vehicle for all staff as “undoubtedly the most difficult and complex aspect” of the proposition. “As a result it will take a significant amount of time to evaluate all of the options and work through the various legal and financial challenges associated with the establishment of such a body.”

It added that that some high-level specialist legal advice on the proposition generally had already been sought.

“Although there are a number of innovative employment models within local government, a model which has no council retained/employed staff will be ground breaking,” it acknowledged.

The report suggested that there did not appear to be any fundamental legal barriers to the development of the proposition. However, it added that further detailed consideration would need to be given to the following issues:

  • Restrictions on local authorities outsourcing statutory decision-making functions;
  • The role and employment of Statutory Officers (Head of Paid Service, Monitoring Officer, s151 Officer);
  • Procurement compliance; and
  • Potential conflicts of interests between commissioners and deliverers.

Cllr Lynden Stowe, Leader of Cotswold District Council, said: “The proposition set out in this report represents perhaps the most radical joint working approach in local government today. It is a proper, considered response to a challenge not only of how to best use a smaller and reducing public subsidy but also how to make best use of technology, how to encourage and use a competitive market, and how to make smart use of managerial and other expertise.

“However, our proposals should also be seen as a natural and logical progression along an innovative transformational agenda which the councils have been delivering over recent years. We should take great encouragement from what has already been achieved.”

Cllr Barry Norton, Leader of West Oxfordshire District Council, added: “The councils already have a track record of developing innovative arrangements irrespective of traditional district, county or regional boundaries.

“This approach builds on that firm foundation and provides a very strong basis to support a new model for local government. It will provide efficient collective shared officer support arrangements, able to provide distinct and bespoke advice to a cluster of independent councils focused around existing district council localities without the need to consider political mergers. This model is scalable both in terms of numbers of partners but also in the scope of services.”

The Cabinet meetings will take place as follows:

  • Cotswold District Council: 5 June 2014;
  • Forest of Dean District Council: 12 June 2014;
  • West Oxfordshire District Council: 18 June 2014;
  • Cheltenham Borough Council: 24 June 2014.

A copy of A 2020 Vision for Joint Working can be viewed here.