Wandsworth and Richmond councils have launched new arrangements to share their workforce in a move they expect will save them £10m a year each.
From this week, staff at the two south west London boroughs will be jointly employed by both authorities and managed by a single chief executive.
Under the new setup, however, both councils will continue to be separate sovereign bodies with their own elected councillors, cabinets and leaders.
They say they will each retain their individual identities and the ability to maintain and develop diverse policies and priorities.
Last year the Government backed the plan with £3m from its Transformation Challenge Awards which support innovations aimed at improving and protecting public services and reducing costs.
Paul Martin, the new joint chief executive (pictured), said: ‘This joint workforce will enable us to preserve the unique identity and values of each council while eliminating duplication in how services are managed and run across the two boroughs.
‘Collectively we are now the largest staff group in London local government, and as such will be able to retain quality, specialisms and expertise which are more sustainable in a larger organisation.’