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Councils mulling in-house services need robust business cases

Pamela Mulcahy
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It will have been of no surprise to most people working in local government when data published by the Department for Communities & Local Government in June showed a massive increase in demand on reserves.

With central government’s austerity agenda showing no signs of abating, and with self-funding on the horizon, councils will pay ever more attention the cost and revenues of the services they deliver.

But despite DCLG’s devolution agenda, the department continues to exert pressure on councils to drive a more commercial approach. A consultation published by DCLG in May proposed changes to the Local Government Transparency Code, which would require councils to publish more data for comparative purposes. This would include publication of ”robust data, quality comparators and a clear options assessment” of in-house services they provide or are considering deploying.

Some councils have already explored whether to set up an in-house enforcement agent (bailiff) collection service, although the set-up costs tend to prove prohibitive. To fulfil DCLG’s criteria, business cases would need to be sophisticated enough to distinguish between enforcement fee revenue, the initial debt, and the new costs involved in delivering a service that is currently entirely free to local authorities.

The cost of requirements such as training and certification, insurance and specialist technology could be relatively simple to assess. It’s harder to assess the impact on collection rates of a less experienced team; enforcement agent infrastructure such as body-worn video cameras; or the effect on customers of being pursued by their own council, compared to an external enforcement agent.

Of course, there will always be additional factors that are difficult to calculate in black and white, such as reputational risk or pressure from advice organisations, who have voiced concerns that there could be a conflict of interest in local authorities being both the body that determines when a case goes to enforcement and also the beneficiary of fees recovered as a result.

A number of councils have expressed trepidation over the increased burden they will face if all of the proposals relating to transparency of data are enacted. Regarding the specific requirement for business cases to be provided for services delivered in-house, however, a robust assessment that encompasses all of the relevant factors would certainly prove a worthy task, giving councils confidence that they are securing the best outcome for both the council and its taxpayers.

Pamela Mulcahy, public affairs director, Marston Holdings

Column sponsored and supplied by Marston Holdings

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Marston Holdings

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