News story

Baroness Hanham calls on councils to be innovative in order to make savings

This news article was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Councils need to be innovative in how they manage their assets and services, said Local Government Minister Baroness Hanham.

Speaking about the implications of the Spending Review at the Local Government Group Conference, Baroness Hanham said:

“The productivity challenge facing councils is how to manage the impact of reduced funding by identifying those areas where savings could be made while protecting vital frontline services.”

Local authorities own over £128 billion worth of buildings and land across the country. Baroness Hanham said they needed to consider innovation when thinking about how they manage their assets and co-locate services. 
 
Some councils have already started to put this into action by creating a one stop shop for local services, putting health services, job centres, and police into 1 area or building. Kent County Council estimate that countywide approaches to jointly managing local authority assets and other public sector assets could deliver around £40 million per year potential revenue savings.

Local Government Minister Baroness Hanham said:

“Councils must take the lead at the local level. They have the freedoms and flexibility to deliver their services in a streamlined and efficient way. By working with local authorities and public bodies, they can maintain vital front line services whilst making savings.
 
“By working with other local authorities and public bodies, co-location of services means that local residents have just one point of call for advice and help. My department is working with local areas by setting up the ‘Capital and Asset Pathfinders’ that will help encourage more authorities to better manage their capital and assets by removing national barriers and unlock potential savings through cross agency collaboration.”

Other ways councils are finding savings:

  • smarter procurement, increased collaboration and economies of scale, for example 16 London boroughs have saved more than £10 million buying ICT hardware collaboratively through an e-Auction
  • streamlining and merging operations, for example Kensington and Chelsea, Hammersmith and Fulham, and Westminster councils plan to merge back office services, and are exploring options to move to a single senior management team and chief executive

The Local Government Group set up the Place Based Productivity Programme to help councils challenge barriers that stand in the way of improvement and find new ways of working in response to the Spending Review.