Aylesbury Vale DC
To mitigate the impact of the end of the government grant by about 2020, Aylesbury Vale DC has sought alternative ways of generating revenue by creating a culture of commercialisation. It has a very motivated political leadership that supports and gets involved in entrepreneurial activities. It has set up a number of initiatives, companies and ventures in a short period of time and hopes to be able to trade its way out of any shortfall from reduced central funding.
Broxbourne’s whole-council, systematic approach to developing commercial opportunities has increased income from property investments, created a building control company, paid for a new crematorium and mausoleum, and significantly increased usage and surplus from a leisure centre.
Ealing LBC set up Broadway Living, its wholly owned subsidiary company, in 2014 specifically to address the lack of quality, public-funded, affordable rental accommodation in the borough. The company allows the council to retain the asset value of its land and use homes for market sale to cross-subsidise the provision of more affordable housing. The company’s remit has expanded to deliver a wider portfolio of new homes across different tenures (sale, equity share, discount market and private rent), which means Ealing LBC is now engaged in building new homes on a reasonably large scale for the first time in more than 30 years.
In 2015, Harrow LBC embarked on a plan to create growth across the council and to be more business-like. A central aim has been to achieve cost neutrality in its environmental services by 2020. It has implemented seven entrepreneurial projects including a trade waste service, an MOT bay, and ground maintenance and pest control services. The council has forecast net income of £6.6m from these in the next three years.
Liverpool City Council
Liverpool’s mayoral investment strategy is an ambitious commercial approach to local government finance. The strategy supports projects that deliver financial returns to the council and/or substantial regeneration and employment opportunities. Both outcomes are essential to improving the city’s long-term financial sustainability. Commercial returns on investments are substantially higher than the council’s traditional balanced risk approach. Investment to date has attracted more than £100m of third-party funding, created or safeguarded more than 1,600 jobs, brought three listed buildings back into use, and is generating a £3m annual net benefit to the council’s finances.
In the light of reduced grant funding and an ever-increasing population, Newham LBC has used innovative ways to develop income streams: building its asset base; investing wisely in areas that will make a return; and creating council-owned small businesses to deliver key services and diversify income. It is building its financial independence and investing profits back into assets and services that will benefit residents in the long term.
North Yorkshire CC
Against a background of austerity, North Yorkshire CC chose to capitalise on its ‘strong service delivery brand’ (LGA peer review, March 2016) and expertise that others would want to buy. It has developed a number of companies and commercial approaches, including expanding its customer base in school services and developing its own waste, broadband and audit companies. This has raised money to help maintain a high quality of services for the people of North Yorkshire.
Reigate & Banstead BC
Reigate & Banstead BC has reshaped how it operates, diversifying its business for long-term sustainability. It has invested in a healthcare initiative with promising social and financial benefits; built on existing strengths to create a bold new property company; and embedded an entrepreneurial mind-set that is changing how it approaches and delivers all of its services. Staff are diversifying too, embracing new skills and driving improvement from the ground up.
By embracing risk and using new powers available to local government, Sevenoaks DC has created a range of opportunities through a property investment strategy, trading company and new economic development and property team, in order to achieve a long-held ambition of financial self-sufficiency and to support the local economy. Its investments secure a return that means it is no longer reliant on government grant, and it has once again forecast a balanced budget in the fifth year of its rolling 10-year budget.
Wychavon DC has a long history as an entrepreneurial council and has invested in projects, joint working and capital investments that not only make a financial return but support the economy, local facilities and green initiatives. From hospitals to Waitrose stores, canals to commercial land, solar panels to art deco cinemas, Wychavon has been there to invest, loan and support. The culture of the organisation welcomes ideas and calculated risk taking and ensures that staff are involved and engaged. This has meant services have been better protected and communities better served due to smart financial management and returns on investments.
Paul Blantern, chief executive, Northamptonshire CC
Chris Naylor, chief executive, Barking & Dagenham LBC
Sue Smith, joint chief executive, Cherwell DC and South Northamptonshire Council
Gill Steward, chief executive, Bexley LBC