Austerity drives councils into U-turn on shared services


Austerity drives councils into U-turn on shared services

Kathleen Hall

Around nine out of 10 local authorities will move to shared services in the next two years, according to a survey of senior local authority managers by Browne Jacobson.

Some 85% of councils said they might also consider outsourcing, while 78% may enter a joint venture with the private sector, it found.

This compares to only half who saw the potential to merge services, and just 5% who saw opportunities of working with the private sector in a similar poll conducted by the firm three years ago.

Dominic Swift, head of shared services at Brown Jacobson, said the change in attitude was due to government austerity drives.

"We can also see a noticeable sea change in attitudes towards merging frontline services. Councils are starting to think outside the box and previous no-go areas such as the private sector and large-scale outsourcing are also back on the agenda," he said.

Of the 150 surveyed, around 63% said they expected to save up to 10% of their total budget savings by sharing services in the financial year ending April 2012.

However, political and public opposition was outlined by 28% as the biggest barrier to delivering shared services. But 84% of local authorities agreed that the long-term rewards of shared services justified the short-term pain.

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