To buy in or not to buy in, that is the question. At least it was when council leaders and academics met at the Institute of Local Government Studies in Birmingham University, invited by APSE, to discuss how far councils should outsource their services. Petra Barnby reports
As private companies use ever-slicker techniques to vie for local authority contracts, council managers are increasingly faced with the age-old question – to what extent should they focus on being ‘enablers’, commissioning the private sector to run services, or should they just run services themselves?
In an effort to help managers navigate through these murky and difficult waters, the Association for Public Service Excellence (APSE) hosted a debate called The enabling authority? The future of local government, at the Institute of Local Government Studies, Birmingham.
And, during the course of the discussion, a consensus was reached. All those present agreed that outsourcing services was sometimes a good thing, and occasionally, not so welcome. Outsourcing could either improve service delivery and save money, or it could worsen – and burn cash.
At the debate, the chief executive of APSE, Mark Bramah, urged a ‘re-think’ of the commonly-held view that councils should ‘enable’ services to be run for them by the private sector.
He said: ‘If councils hand away all their capacity to the private sector and there is suddenly community pressure to change a service, for example, they will not be able to respond effectively to the community they serve. They will lose their flexibility, wherewithal and knowledge.
‘Councils should retain a strong core of services which enable them to respond.’
The nine senior council managers attending the debate complained how long-term contracts with private companies rarely catered for the changing nature of communities. Who, for example, could have anticipated, 10 years ago, that childhood obesity would be a major problem in 2008? What contract might adapt to such changes?
Sometimes services were best run in-house. Prof Helen Sullivan warned council managers to be cautious.
‘What we are now seeing is the promotion of one version of the “enabling” authority. One key argument is that who provides services is no longer the issue. What matters is what is provided, to what standards – and at what cost.
‘This is not something local authorities should just accept. They may decide that, in certain circumstances, who provides does matter. This kind of consideration is vital if the local government system is to become one where “localism” has real meaning,’ she said.
Some services clearly benefited from having council staff running them, as opposed to staff from a private business, according to chief service development officer, Alistair Merrick, of Wolverhampton City Council.
‘Council staff have different priorities from staff employed by a private company,’ he said.
Part of the problem was the increasingly-popular use of the expression ‘strategic commissioning’, which was widely misunderstood, according to the director of leisure at Sefton MBC, Graham Bayliss.
‘Commissioning does not mean externalising services. The assumption that the private sector runs better services is a very dangerous one. It is a lot more difficult to have flexibility if you outsource a service,’ he said. This misunderstanding had been exacerbated by a general feeling among council managers that the Audit Commission would assess them more favourably if they were to outsource services. This had led, they said, to some councils outsourcing when it might not be the best way of providing a service.
The director of studies at theAudit Commission, Michael Hughes, endured a barrage of questions about how the commission’s new comprehensive area assessments would approach the question of ‘strategic commissioning’. Did the commission favour councils which outsourced services?
Mr Hughes reassured delegates that this question was considered in drawing up the new assessment. In future, he said, the assessment would focus ‘solely on the cost and quality outcomes’ of a service, and not who, or how, it was provided.
There were audible sighs of relief all round. The session had scratched the surface of a complex and fractious debate, but delegates left reassured.
However fashionable outsourcing has become, it is not always the most robust option.
In an effort to help managers navigate through these murky and difficult waters, the Association for Public Service Excellence (APSE) hosted a debate called The enabling authority? The future of local government, at the Institute of Local Government Studies, Birmingham.
And, during the course of the discussion, a consensus was reached. All those present agreed that outsourcing services was sometimes a good thing, and occasionally, not so welcome. Outsourcing could either improve service delivery and save money, or it could worsen – and burn cash.
At the debate, the chief executive of APSE, Mark Bramah, urged a ‘re-think’ of the commonly-held view that councils should ‘enable’ services to be run for them by the private sector.
He said: ‘If councils hand away all their capacity to the private sector and there is suddenly community pressure to change a service, for example, they will not be able to respond effectively to the community they serve. They will lose their flexibility, wherewithal and knowledge.
‘Councils should retain a strong core of services which enable them to respond.’
The nine senior council managers attending the debate complained how long-term contracts with private companies rarely catered for the changing nature of communities. Who, for example, could have anticipated, 10 years ago, that childhood obesity would be a major problem in 2008? What contract might adapt to such changes?
Sometimes services were best run in-house. Prof Helen Sullivan warned council managers to be cautious.
‘What we are now seeing is the promotion of one version of the “enabling” authority. One key argument is that who provides services is no longer the issue. What matters is what is provided, to what standards – and at what cost.
‘This is not something local authorities should just accept. They may decide that, in certain circumstances, who provides does matter. This kind of consideration is vital if the local government system is to become one where “localism” has real meaning,’ she said.
Some services clearly benefited from having council staff running them, as opposed to staff from a private business, according to chief service development officer, Alistair Merrick, of Wolverhampton City Council.
‘Council staff have different priorities from staff employed by a private company,’ he said.
Part of the problem was the increasingly-popular use of the expression ‘strategic commissioning’, which was widely misunderstood, according to the director of leisure at Sefton MBC, Graham Bayliss.
‘Commissioning does not mean externalising services. The assumption that the private sector runs better services is a very dangerous one. It is a lot more difficult to have flexibility if you outsource a service,’ he said. This misunderstanding had been exacerbated by a general feeling among council managers that the Audit Commission would assess them more favourably if they were to outsource services. This had led, they said, to some councils outsourcing when it might not be the best way of providing a service.
The director of studies at theAudit Commission, Michael Hughes, endured a barrage of questions about how the commission’s new comprehensive area assessments would approach the question of ‘strategic commissioning’. Did the commission favour councils which outsourced services?
Mr Hughes reassured delegates that this question was considered in drawing up the new assessment. In future, he said, the assessment would focus ‘solely on the cost and quality outcomes’ of a service, and not who, or how, it was provided.
There were audible sighs of relief all round. The session had scratched the surface of a complex and fractious debate, but delegates left reassured.
However fashionable outsourcing has become, it is not always the most robust option.
