Shared Services and the Scottish Public Sector

This conference followed a broadly similar theme of the New Economic Realities conference in September (see previous blog). The morning started with the dismal keynotes from John McLaren, Honorary Research Fellow at CPPR on the Scottish budget position and Sir John Arbuthnott on the Clyde Valley Review on Shared Services, the initiative of 8 Scottish councils in the west of Scotland. Putting it in contact Scottish local authorities spend £20billion per year, employ 250,000 staff and have £32billion worth of assets. Pressure is growing to think ‘outside of the box’ and come up with radical proposals. They don’t have to be practical or popular but local authorities have to ensure they have considered a wide range of options. This came on the morning when David O’Neill from North Ayrshire Council was called to defend a proposal to change the school week to four days, striking panic into the heart of every working parent. It was quickly taken off the table but the seed was sown. This was followed by a number of sectoral or vendor presentations looking at shared back office solutions, joint procurement, transport, social care and health. The last presentation before lunch was on Total place budgeting, which identifies issues and pools budgets across the public sector to address them.
Lunch provided opportunities to talk over issues including public sector pensions, employment law, the effectiveness of arms length organisations and asset management. The afternoon sessions included Peter Tait from Audit Scotland on pooling knowledge and expertise. He referred delegates to Audit Scotland’s 2010 report Preparing for the future and cited successful shared service in Tayside Contracts and Strathclyde and Lothian Pension Funds. These have become so normalised they are not even recognised as shared services. The failure of shared services are often down to ill preparedness, naivety, poor project management skills and lack of success criteria. Laurence Ward of Dundas & Wilson looking at bringing together public and private sector partners, much of this focused on risk and reward and staff contract management.
Finally Alistair MacNish formerly of Chief Executive of South Lanarkshire Council and latterly Chairman of The Accounts Commission had his say. Freed from the constraints of public office and with his OBE safely in the bag, he had a blistering attack on the inadequacies of shared services in tackling the budget challenges. The Clyde Valley Partnership boiled down to £14million a year for five years and Glasgow, allegedly, spends £6million a year on taxis. Problems include 3.5% increase in elderly population for next 20 years and the Climate Change Bill which will add £8billion to bills over 10 years. Rejecting all tinkering he proposes more of the same in the guise of local authorities but fewer of them (12 mainland and 3 island – even though Orkney, Western isles and Shetland are already talking about a single authority). Citing Scotland as over-governed he proposed cutting MSPs and 352 councillors saving £7million a year as almost not worth doing. Finally merging fire and rescue services and transferring Scottish Enterprise responsibilities to councils were also his suggestions. Cosla are already in discussions about the creation of a national payroll and there are moves to transfer teachers to a national employment contract, deployed to local schools, so it seemed that he fell short of suggesting centralising education, waste management, roads social care and health, but then what would councils be left with?


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