Soaring budget gaps, the risk of financial collapse and a move towards self-financing – it would be fair to say that back in pre-austerity days not many councils could have predicted what the sector would look like today.
But what if council leaders did have a crystal ball, forewarning them about what was to come? Would this have changed the shape and very nature of local government today?
It may not have been clairvoyance, but back in 2010 Andrew Grant, the chief executive of Aylesbury Vale District Council, came to the realisation that the Treasury was unlikely to relax its financial stranglehold on local government any time soon. In fact, Mr Grant rightly predicted the Government would cease grant funding to councils altogether and expect the sector to become self-financing by 2020.
Mr Grant explains: ‘Let’s go back to 2010: we were struggling with the depths of the austerity measures and were finding it hard to see how we could afford local government? The tap was being turned off so how do you still maintain credible, essential services?
‘We decided we needed a new business model – which back then was a commercial term and not something used in local government. We needed to find a different way of earning new income or to be more efficient to grow services.’
This acceptance of the financial future of local government enabled Mr Grant to realise that if the council could become more commercially-minded, this would ensure it could afford to provide services that would never be chargeable such as homelessness support.
Mr Grant has no problem admitting that his first port of call was Googling ‘business model’ to determine the best way to proceed.
‘I knew we needed a different platform to make ends meet, but it wasn’t what local government was talking about at the time,’ he says. ‘You can be as efficient as you like but soon it won’t be enough - you can’t run everything from nothing.
‘Through Google I discovered that if you get your value proposition right, people will pay for services. Just because you’re a council, that doesn’t mean you can’t provide services that people will want to buy.’ What followed was a whole series of firsts for local councils – from switching to the cloud to getting rid of traditional council departments in favour of customer and community fulfilment roles.
The council’s vision was to become more of a commercial and customer-centric organisation, providing the same level of services to residents as other global online retailers.
‘We were the first council in the country to go with Amazon Web Services, who were the only ones at the time to offer us cheap overnight computing,’ says Mr Grant. ‘We were also the first in the UK to take back office services in the cloud from software company TechnologyOne. We were also one of the first to work with Arcus Global to implement the Salesforce platform, creating a commercial platform to register customers in the CRM to deliver new services directly to them through email.’
The Salesforce platform helped to launch My Account, creating an online community for residents and businesses. My Account enables people to access a range of council services such as applying for benefits or paying their council tax.
In the first six months, the council estimates My Account has already saved more than 900 hours of officers’ time, with 27,000 out of 75,000 households already signing up.
Mr Grant added that 15% of their customers are aged over 75, dispelling the notion that is only the younger generation that wants and is able to use an online system.
Andrew Lawson, managing director of UK & Ireland at Salesforce, agrees that My Account shows a deep understanding by the council of residents’ needs. He says: ‘Aylesbury Vale District Council has tapped into the way consumers interact with innovative brands in the private sector, to enhance service delivery. Its online community has transformed council services with simplified customer transactions, automated processes, and real-time data.’
The council has also introduced web chat so staff can work from home answering queries until midnight while the council office is closed. It is also exploring what other services could be provided on a subscription basis such as home cleaning or language tuition.
This digital transformation programme has touched pretty much every service offered by the council, and Mr Grant points to its planning services as just one example of the savings and improvements achieved.
‘We have managed to turn planning from costing £1.5m in costs to making half a million in profit. We weren’t using the fee properly and each application was too expensive.’
Previously for every £172 fee the council received, it spent on average £600 processing the application. Now, thanks to a simplified process and going paperless, it has dramatically reduced the time to make a decision, freeing the council up to spend more time – and make more money – on bigger developments.
So what next for this ambitious council? One thing’s for sure, Mr Grant hasn’t run out of bold and innovative ideas yet and suggests the next stage will be to create a ‘tax free’ authority in the future. As he explains, about £8m is raised through council tax in the district, which only receives about 10% of this money.
‘I can’t run Aylesbury Vale on £8m and, as you can only increase council tax by 2%, what if we went tax free? If you could live in Aylesbury Vale tax free because we are making enough money off of subscriptions and selling things to people that they want, we should have enough money to pay for the services we need out of that.’
He points out that a business generating £100m or even £1bn a year could cover the cost of all the services the council would need to provide. ‘You can’t scale tax but you can scale income and profit’, he adds.
Between 2010-15, the council has achieved savings of £14m, half of which Mr Grant attributes to digital transformation. Personally, I can’t wait to see where this figure stands in another five years.
