Why shared-services partnerships should be entered ‘eyes wide open’

Three London councils are set for an ICT partnership predicted to save £6m a year, but success will require transparency, continual assessment and an exit plan for each authority. Gill Hitchcock reports.

Financial pressure is pushing local authorities to consider alternative forms of service delivery, including working with other councils. Haringey is the latest to prepare the ground for a partnership, in this case one which will see the London borough join neighbours Camden and Islington in an ICT programme that it predicts will save £6m a year.

The tri-borough partnership has already been voted through by Haringey’s cabinet and Islington’s executive, but awaits final approval from Camden’s cabinet at a meeting on April 6. 

The plan is to create a committee of representatives from all three councils who will meet in public to oversee the joint ICT service. Pending Camden’s approval, the councils will advertise for a head of service to lead and manage their programme in late spring. 

Like most local authorities, the three councils already use a range of technologies for business and citizen services, but the new partnership is expected to drive through what a Haringey spokesperson describes as “a more ambitious programme of change”. 

They declined to provide more precise details about the borough’s digital plans and how savings would be achieved, but the expectation is that the £6m in projected efficiencies will be shared equally across all three councils. 

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Chancellor George Osborne’s Spring Budget promised a further £3.5bn of “savings” in public spending in 2019/20, a commitment likely to impact the work of councils. Jason Arthur, Haringey’s cabinet member for resources, says the partnership will “help us to deliver excellent digital services that make life easier for residents, and at the same time save money and protect more of our budget for other key areas”. 

Other authorities to take the partnership route include the SE7 group, including Brighton and Hove City Council, East Sussex County Council, Hampshire County Council, Kent County Council and Surrey County Council. Their collaboration, which began last year, identifies ICT and procurement among six areas where they will collaborate to drive down costs and improve services.

But partnerships carry potential risks as well as benefits. Joint working can bring “a perceived loss of control over policy and a perceived loss of management control over the quality of service delivery,” according to accounting and consultancy network Grant Thornton.

“In general, local government continues to guard its independence closely despite the cost savings that might be available,” a recent report by the organisation concludes.

For councils looking to form successful partnerships, a good starting point could be implementing British Standard 11000 on collaborative business relationships. The benchmark says that from the outset professionals should identify where collaboration will have the greatest impact on value and performance and make a full analysis of opportunities and threats.

There are other recommendations, such as carrying out an internal assessment to identify what your organisation can offer potential partners, as well as what is being sought in return. Constant monitoring of relationships so that performance is improved and optimised is also required.

The standard also points to the need for organisations involved in partnerships to have a joint exit strategy so that services can be maintained beyond the agreement. When a relationship is coming to an end, communication is “all-important” so that reputations are protected, the partnership ends amicably and the organisations involved have the opportunity to create further partnerships, it states.

The Society of Local Authority Chief Executives believes transparency and information sharing between organisations is key to partnership working. “An asymmetry of information in which professionals possess all the knowledge gets in the way of a true partnership,” Eric Bohl and Mike Wynn write in the society’s 2015 guidance paper Towards Outside In.

They add: “Professionals will need to work even harder to build plain language repositories of information that all participants can access.”

Meanwhile, the partnership between Haringey, Camden and Islington is set to start on 1 October 2016. With a refreshing lack of management-speak, Islington’s executive member for finance Andy Hull believes that because government funding cuts are hitting councils across the capital, it simply “makes sense” for the three to work together.

Jim Dunton

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