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Wirral: 'It's income generation, not commercialisation'

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Commercialisation is a bit of moot point for Eric Robinson, chief executive of Wirral MBC. “What we’re actually talking about is income generation,” he says.

In a sometimes clouded debate about what counts as commercial, Mr Robinson’s view is straightforward. Like many local government leaders, he is keenly aware that central government funding is dwindling, and that his council needs income to afford the future.

Wirral has adopted a more commercial approach since Mr Robinson took office three years ago. “Partly I was recruited because I’d set up a lot of new ways of delivering services – a lot of integrated public services,” he says.

The direction was sanctioned by the council, he says. “It just didn’t know precisely how to do it or precisely how it would look.” This is despite Wirral being a Labour-led council, sometimes thought of as less open to taking a business-like approach.

“The phrase income generation is a less politicised phrase than commercial, but actually it’s about broadly the same type of thing,” Mr Robinson says. He adds that generating “social value” is tied in, combining “a private sector head and a public sector heart”.

To effect this change in approach, the council brought in new directors of finance, business support services and even human resources. It even set up a commercial department to bring together all the contracting and commissioning, as well as to provide support for the rest of the council. “What we wanted to do is to get the right permanent people in post here and then create the right cadre of managers,” Mr Robinson says.

Several models have emerged out of this. One is focused on the Floral Pavilion Theatre, located in New Brighton to the north end of the Wirral. Previously it lost the council £500,000 a year. After constructing a business case and examining its options, the council decided it would be best to let a private firm run it without subsidy.

“What you’ve gone through is not a dogmatic view, but a view that is based on a proper piece of work and evidence,” Mr Robinson says. “Actually amassing the evidence is a critical part of that and of finding the best way to solve these problems.”

The council pursued another model for Edsential, a company set up with Cheshire West & Chester Council with a commercially-minded chief executive to better support schools. According to Mr Robinson this has saved the council “a significant amount of money” while maintaining the public service.

“Each particular area of council activity will have a bespoke answer as opposed to all of them having the same answer,” he says.

Wirral MBC has also done a lot of work integrating various services with other partners to save money, including around community safety, health and social care, and business support activity – the latter involving the local chamber of commerce.

Another big commercial project is the Wirral Growth Company, a joint venture set up with Muse Developments directed towards regeneration. The idea stems from, in Mr Robinson’s description, the council having lots of assets and scarce funds, while partners in the private sector have funds but a lack of assets. In the first three years the company plans to bring in £260m of private sector investment.

This will earn the council a dividend, council tax revenue and business rates. Earnings will be worth £6m next financial year, £8m the following year, and £12m the one after that. “That’s an imaginative and creative way of again doing something that’s needed – regeneration – but actually doing it in a way that earns the council a very, very significant amount of money,” Mr Robinson says.

Given the scope of its activities, Wirral MBC is also integrating its risk management processes more closely, moving from a project-by-project model to a holistic one. Projects are initially assessed on their own merits for risk, then they are considered in the context of other investments. “Now we’ve got enough projects that are moving in this direction we realised we need to look at our risk from the whole of our portfolio,” Mr Robinson says.

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

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