Slough BC pulls out of ground-breaking shared services arrangement
Cambridgeshire and Northamptonshire county councils have vowed to press ahead with a ground-breaking shared services arrangement that will deliver services to the two partner authorities and the wider public sector, despite the recent decision by Slough Borough Council to pull out of the scheme.
The Local Government Shared Services (LGSS) partnership will cover legal services and four other functional areas:
- Finance
- Organisational Development & Human Resources
- Procurement, and
- Internal Audit.
The total annual revenue value of support services that would be undertaken by the LGSS Partnership is £23.6m.
A spokeswoman for Northamptonshire said: “In February and March of this year, cabinet members at both [councils] approved recommendations to jointly create a shared services organisation. They also endorsed a decision to make arrangements for the appointment of a managing director for the local government shared services to oversee the establishment and operations of the project and for work to continue on the business case.
“Cabinet members also agreed that steps could now be taken to begin preparation with a view to negotiating and entering into agreements required for the project.”
The “aspiration” of Cambridgeshire and Northamptonshire is for the LGSS Partnership to become a separate corporate entity in due course. However, following external legal advice on the impact of the LAML case, the councils have decided not to move to separate legal entity at the first stage, relying instead on the more established model for collaboration of a partnership run by a joint committee.
Current practice restrictions would also have prevented the councils’ lawyers being employed by a separate entity. These are set to be lifted with the introduction of alternative business structures in October 2011.
In terms of legal services, internal audit and procurement – which were only added recently to the list of functional areas covered by LGSS – the councils believe the benefits include allowing the authorities to pool specialist resources and create additional capacity, offer a comprehensive ‘end to end’ support service, source more cost effective services from third party suppliers and make savings by adopting common procurement strategies and sharing expertise.
Slough’s withdrawal followed a review of the outline business case for LGSS. Roger Parkin, Strategic Director Improvement & Development at Slough, said: “Given our council’s present priorities and financial commitments, we feel we cannot commit fully to the Local Government Shared Services initiative.
“We recognise the potential efficiencies shared services can offer and we will be making a careful assessment of all our options in the next few months. Our next immediate step will be to review our support services and, where possible, start using the best practice processes that we have learned from the LGSS project.”
