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Questions councils must answer to navigate commercialisation

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As an adviser to many public sector bodies, DWF has seen a pronounced increase in commercial activity among local authorities in the past decade.

Activities as diverse as the formation of local authority trading companies, joint ventures, enterprise zones or housing and development companies, property acquisition, grant and loan funding, consideration of future business rates and the renegotiation of PFI contracts have increased the sector’s demand for (and reliance on) sound commercial and legal advice.

Broadly speaking, we know that the increase in commercial activity is being driven by the fact that authorities have had to seek new ways to deliver more for less and generate income for frontline services, but there are vital questions to be answered that could help authorities and legal advisers navigate future commercial opportunities more effectively.

DWF has worked with LGC to create a special report on commercialisation, released today, assessing the challenges organisations are facing, the commercial models available and the strategies being adopted across the UK. We consulted over 150 organisations through a survey, in-depth interviews and a roundtable, gaining views from senior executives, elected members, trading company directors, local enterprise partnerships (LEPs) and the private sector to provide real insight into this rapidly developing agenda.

Some of the critical questions we address are:

  • How do we define commercialisation in the public sector?
  • How financially viable is commercial activity and what are the options for the sector?
  • Are we likely to see commercial activity increase or decrease in the future?
  • What can we learn from the successes and failures of authorities so far?
  • In which areas do you expect additional revenues in the future?
  • Does the sector have the skills to deliver its commercial objectives?

We hope that the survey results, case studies, and roundtable discussion serve to inform public sector officers and elected members looking to understand the current commercialisation landscape and the implications for the future.

Jonathan Branton, partner, head of public sector, DWF

Read LGC and DWF’s full report: Commercialisation: Safeguarding the future of local public service delivery

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