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Whitehall initiatives will fuel more local shared services

30/04/15

Analyst paper predicts that Universal Credit and the Care Act will prompt increased collaboration between councils

Central government programmes promise to provide a boost to shared services and outsourcing in local government over the next Parliament, according to a new briefing paper by IT analyst company TechMarketView.

HandshakeLocal Government Shared Services: Where are we now? predicts that Universal Credit, the Care Act and cross-agency programmes will prompt the creation of some sizeable deals over the next few years. They will force public authorities to collaborate in local areas to deliver joint outcomes, and take on a strategic nature as councils will have to change the way they deliver some service.

Georgina O'Toole, director at TechMarketView, told UKAuthority that this derives partly from the common processes for councils in their contributions to managing the demands of Universal Credit and the Care Act.

"But also anything where there is a clear outcome involving a defined group of people (such as in the Troubled Families programme)," she said. "I believe this accelerates collaboration and shared services between public sector organisations.

"That doesn't mean it won't be outsourced too. In fact, those are some of the more complex projects, so chances are the private sector would be involved in some way."

Back office stronger

The paper highlights a growing take-up of shared services by local authorities, citing Local Government Association findings that more than 96% are sharing some services. Twice as many cover back office operations as customer facing services, and the pressure to find savings will lay the ground for more to come.

It says that smaller councils are more likely to get involved in shared services - whereas larger authorities choose outsourcing to deal with more complex demands - but that few deals have been successful in attracting many new partners after their launch. Councils are often nervous about taking up a shared service when they have not been involved in its initial design and the relevant procurement.

The numbers in the report show that 292 shared service agreements in operation, with 51 in development and four closed down, while there is a question mark over the status for 68.

Picture by Lucas, public domain through Wikimedia Commons

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