Local, Regional, National: What services are best

delivered where?

A Report to Carl Sargeant AM, Minister for Social Justice and Local Government

CAB(10-11)66 simpson repor 

Introduction .................................................................... 3

1. Wales: a different opportunity? ................................10

2. Principles for change ................................................12

Principle 1: The outcome must be better for the citizen and user ...... 12 Principle 2: Focus on functions not whole services ........................... 13 Principle 3: It is about better collaboration not just hard geography .. 15 Principle 4: Collaboration can take many forms ................................. 16 Principle 5: Local accountability and freedoms must be

enhanced and not diminished through the process ........ 18 Principle 6: We have to ask the right questions ................................. 19 Principle 7: Leadership to deliver the change .................................... 20 Principle 8: Engaging staff is critical .................................................. 21 Principle 9: Creating a Compact with consequences .......................... 22 Principle 10: Supporting the change to deliver the change ................ 22

3. Local, Regional or National: the big ask ................... 25

Social Services .................................................................................... 25 Education ............................................................................................ 28 Regeneration, the environment and waste management .................... 31 Planning services ................................................................................ 33 Corporate services .............................................................................. 35 Procurement ........................................................................................ 38 Public protection and regulatory services ............................................ 40 Specialist services ............................................................................... 43 Emergency response ......................................................................... 45

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4. Governance .............................................................. 46

What is good governance? ................................................................. 46 A new role for councillors ................................................................... 50

5. Levers for change ..................................................... 52

Creating a new momentum ................................................................ 52 Local government leadership is vital .................................................. 55

6. Creating the big offer................................................... 57

Appendix One: Review Group Members

Appendix Two: Reference Group Members

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Introduction This is the interim report of the group established by the Minister for Social Justice and Local Government to examine how local government might perform better if it were to review and realign the commissioning and delivery of some of its functions. The test for any outcome of such a review would be that, at a minimum, change would deliver better value for money or lead to an improvement in service. All our proposals have had to pass the test of either delivering service improvement or saving money. Ideally in most cases, both outcomes could be achieved.

In establishing this review, the Minister made what we should best describe as a “big ask”. This Review Group believes it is the responsibility of local government in Wales to make a “big offer” in response. The “big ask” is for step change in the pace of change and the level of aspiration around collaboration. Local government’s “big offer” should be about how this is achieved - both geographically and functionally.

The Minister appointed Joe Simpson of Local Government Leadership to lead this review. Two groups were established to take this review forward, a Review Group and a Reference Group. The Review Group consisted of leaders from across local government and public service (see Appendix One for details of the membership). It has considered a wide range of research and experience across local authorities to determine which services might be more effectively delivered through different governance arrangements. The Reference Group also engaged senior leaders, including those with specific knowledge of some of the key areas for review. It was established to bring forward evidence, ideas and proposals informed by their professional expertise (see Appendix Two for details of the membership).

This review does not concern itself simply with the reconfiguration of services. Neither does it have all the answers – that would be to negate the range of positive local work that is already underway. It would also override the wealth of expert knowledge that is available within local government in Wales to shape and plan the next stages of the pattern of services in Wales. We have aimed to build on work that has been done and structures and organisations that are already in place wherever possible. We do make recommendations and are confident that these are consistent with the direction of travel we have seen already in social services and will see soon in education.

We do however outline ten principles that should underpin and inform the thinking of Ministers and local government behind collaboration. Together these create a framework within which local government can move ahead with pace and confidence to meet the challenges of the Welsh Assembly Government (WAG) and their citizens.

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The Minister was explicit in his commission and we have been clear throughout that our work is not a review into local government boundaries. We believe in the importance of strong local democracy as a means of enabling citizens to articulate their views as well as being able to hold service providers to account. Effective governance is a prerequisite to high performing and continually improving services. We believe that the proposals outlined later will enhance local democracy and lead to better, cheaper services.

The focus of this report is on the need for change as more functions, or parts of services, are organised on a regional and national basis. However, we advocate that change should be through collaboration rather than reorganisation because of the need to ensure that the core of our services continue to be organised locally. It is in local communities where the connection with citizens can be most fully developed, where community leadership can be exercised and where the opportunities for service integration can be best grasped.

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Recommendations We have made a series of recommendation throughout the second half of this report. Some of them are fairly specific and concern themselves with providing support and momentum to expand and build on concepts and projects which are largely proven. We see these as the first round of work that would be covered in the Compact. We have highlighted these.

Other recommendations relate to more strategic developments which will require further thought and consideration. This scoping work would also form part of the Compact discussed in principle 9, but clearly, further development will be subject to the construction and testing of a business case. However, as we note, in scoping further work, it is easy for change to stall through a disproportionate focus on the options, numbers and risks. Given the public sector’s financial circumstances and the clear expectations from the Assembly Government, it will be vital that all those involved keep their focus firmly on the ends – not the means.

We note that this review is one of three that has been commissioned by WAG (the other two focusing more specifically on education and on social services). We believe that the approaches adopted by the reviews have sufficient commonality for there to be an opportunity to demonstrate a systemic coherence in the way that WAG and Welsh local government responds to the reviews. We also expect there to be some common timelines in reviewing the progress made to deliver the changes.

Recommendation 1

A Compact detailing the development of collaborative and national service delivery will be agreed by the Assembly Government and the Welsh Local Government Association (WLGA) by July 2011. This Compact will set down a realistic but challenging timeline for dealing with our recommendations. It will also set out potential responses that Ministers could take if local authorities do not meet the obligations they signed up for. It will be important that the Assembly Government and WLGA agree and articulate what success will look like.

Recommendation 2

We recommend that the following principles inform the agreement of the Compact for Change: 1. The outcome must be better for the citizen and the user

2. Focus on functions not whole services

3. It is about better collaboration not just hard geography

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4. Collaboration can take many forms

5. Local accountability and freedoms must be enhanced

6. We have to ask the right questions

7. Leadership to deliver the change

8. Engaging the staff is critical

9. A contract with consequences

10. Supporting the change to deliver the change

Recommendation 3

We recommend that reporting and scrutiny of progress against the provisions of the Compact will be through the existing, statutory, Partnership Council arrangements. Recommendation 4

We are delighted that there is considerable agreement between our thinking and the recommendations that we expect to arise from the education review. With that review due to report by the end of March, this review group has no ambition to pre-empt that review. We note that in line with our focus on the needs of the user, we expect that review to focus strongly on the needs of the learner.

The two reviews should therefore be seen as complementary. We note the progress already made by regional consortia. We would recommend that the timescales for change from both reports should be synchronised. We would thus see the next two years as critical for change. We would expect that existing preparations for enhanced collaboration in education services are completed over the next year and implemented during 2012-13.

We note there is already some momentum for change through the existing consortia, and we expect the education review to seek a step change in the speed and scale of ambition. We await their report but would assume that amongst the issues it will address will be: robust systems of performance information; support for education improvement in schools; support for leadership development within schools and governing bodies; commissioning systems for Additional Learning Needs.

We would also assume that the review will focus on arrangements for better cross-sectoral planning across schools and colleges. The roles of universities and workplaces, whilst not specifically within the remit of the review, might also be considered in this context.

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Recommendation 5

We have made a series of recommendations about reconfiguration of administrative and transactional services across local government. We also see scope for changes in the education area. For example, we recommend that the administration of student grants is organised at a national level. And in line with recommendations elsewhere we would recommend that attention be given to arrangements for human resource management, catering, transport and asset management in this area as elsewhere, wherever business planning demonstrates an economy of scale.

Recommendation 6

Again we are pleased to see that the approach proposed in the recent Social Services White Paper chimes with that outlined in this report.

We recommend that arrangements for collaborative procurement in social services are put in place across Wales for the procurement of:

• high cost care packages for looked after children, mental health and learning disability;

• domiciliary care;

• tele-care;

• emergency duty teams; and

• respite care.

Recommendation 7

We recommend that there be collaborative provision of support services for social care in the following areas:

• specialist legal advice;

• direct payments administration;

• IT systems;

• complaints and investigations; and

• social work training and recruitment.

Recommendation 8

We recommend that the procurement of facilities for the management and re-use of waste be organised collaboratively by local authorities.

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Recommendation 9

We recommend that the planning, management and delivery of strategic highways be organised collaboratively at a regional level. Recommendation 10

We recommend that architect and specialist engineering services be organised collaboratively at a regional level. Recommendation 11

We recommend that the mineral planning service and other specialist planning services be organised on a national level. Recommendation 12

We recommend that a national resource of planning expertise be established so as to enable the public sector to make best use of its own expertise, avoiding expensive private sector input. This should include a standardisation of planning application standards and requirements at a national level whilst maintaining the practical validation of applications at a local level. Recommendation 13

We recommend that there be collaboration between local authorities for the provision of a range of corporate services including payroll, pensions, legal services, and human resources that should, over time and in some instances, progress to national services. Recommendation 14

We recommend that plans be developed and progress made in achieving collaboration in the collective procurement, system deployment and maintenance of ICT systems. Recommendation 15

We recommend that authorities consolidate and build upon existing arrangements for collaborative procurement based on shared approaches to contract documentation, standards and financial limits.

Recommendation 16

We recommend that where regulatory risks are regional or national the regulatory service collaborate to deliver on a regional or national basis. This is the case in

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matters such as illegal money lending, trading standards, food standards and food hygiene, air quality and land contamination.

Recommendation 17

We recommend that local authorities collaborate in the delivery and procurement of Welsh translation services. Recommendation 18

We recommend that there be collaboration in library services leading to the procurement of shared information systems which support shared procurement, shared borrowing, and information services. Recommendation 19

We recommend that emergency planning be organised on a regional and cross-sectoral basis involving local authorities, the NHS, police and fire services. Recommendation 20

We recommend that the Minister engage more actively with authorities in order to provide them with the political and leadership support required to maintain momentum. The Minister should also consider using existing powers to support and encourage change through collaboration in the delivery of services. Recommendation 21

We recommend that the WLGA clarify its various roles so as to allow a clearer separation between its service delivery and policy roles.

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1. Wales: a different opportunity? 1.1 This review was commissioned prior to the 2011-12 local government

settlements being announced in both England and Wales. Those announcements reflect the very different central-local relationships in each country and set the scene for potentially very different futures for local government. The settlement in England requires local authorities to reduce expenditure at a rate and scale not previously encountered.

1.2 In contrast, whilst the first year of the settlement in Wales will require difficult decisions, the next two years show an increase in the total local government expenditure and the percentage of the total Assembly Government expenditure that is spent by local authorities. That still leaves considerable challenges for authorities, for example, the changing demographics of Wales means that adult social care bills will continue to increase, but the approach of the Assembly Government further underlines its commitment to partnership with local authorities as well as protecting the vulnerable and maintaining public services.

1.3 The consequence of these two differing paths is to pose a very different challenge to Welsh local government to that in England. We recognise that local authorities in Wales have been making progress on joint working and collaboration. Much good work has been done, sometimes driven by the Welsh Local Government Association (WLGA) and its regional boards, sometimes by the four education consortia and other bodies, and sometimes by the dedication of individuals. This good work should be recognised, built on and encouraged to expand. This review has found that there is much support for this change across the Assembly Government, the WLGA and Solace Wales. It should be in everyone’s interests to drive it forward at pace.

1.4 However, if we believe there is a link between levels of investment and the quality of the resulting services, then the consequence of the English and Welsh paths suggest that by the end of this public expenditure round we should see clear differences in both the quality and the rate of improvement of services being offered on either side of the border. But, unless Assembly Government Ministers and the public can see those differences then it will be difficult to justify continuing to provide, in comparative terms, the relatively generous levels of financial support to local government in Wales.

1.5 Our message is this: having made the financial commitment to Welsh local government, the Assembly Government has the right to expect a social return through enhanced public services. In other words, “steady as you go” is not an option.

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1.6 We make a series of recommendations about specific services and functions. We have not conducted detailed financial evaluations as to the levels of savings possible; such an analysis would be part of the next stage of work. Rather we have focused on evidence arising from existing collaborations in Wales and England to highlight the areas where, with a common sense approach, we know there is scope for improvement/savings - but where we believe that even more can be achieved.

1.7 We have also suggested a timetable for some of this work to happen. We are not inflexible about the order of change as we recognise that this will vary in different parts of Wales. This will reflect different local needs, and different opportunities (perhaps based on existing collaborations). As a first challenge for Welsh local government we believe that an agreed timetable for action should be established as a matter of urgency, so delivering this schedule would itself be a clear example of commitment to the “big offer” that we believe has to be made.

1.8 Before considering the arrangement of functions, we should clarify some terms and underlying principles. We regard these as our ten principles for achieving the change.

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2. Principles for change

Principle 1: The outcome must be better for the citizen and user

2.1 Any change in service delivery or distribution of functions must benefit the citizen as a service user and as a taxpayer; and/or deliver a better service. To make this a real test we therefore either need cashable savings delivered within an agreed timetable or defined service enhancements which the users of that service can understand and appreciate. Put another way, we need to be able to demonstrate increases in productivity which can be objectively measured and/or service enhancements which improve the offer to users and citizens.

2.2 These need to be tough and transparent tests. They also need to be delivered within the timeline of this local government financial settlement. Both the Assembly Government and Welsh local government should expect these achievements to be the basis for future decisions on financial allocations for local government as a whole. In other words, Welsh local government should explicitly commit to significant productivity increases that would demonstrate greatest efficiency, whilst the Assembly Government should equally commit to a policy which incentivises public services to be more efficient by rewarding efficiency and not penalising it.

2.3 How these improvements will manifest themselves will vary. For each case therefore we should be explicit about the intended benefits. Depending on what those benefits are, we might well design slightly different forms of collaboration and we return to this point below. In all cases, we should seek better outcomes for citizens. Amongst the range of possible better outcomes we can foresee are:

i) Cost avoidance – joined up early intervention strategies can save significant costs later on for public sector bodies.

ii) Cost saving – are we at critical mass in our existing service delivery groupings or are there more economies of scale that we can take greater advantage of?

iii) Policy alignment – can make understanding of services by citizens and professionals easier. This is not to presume that all authorities must have the same policies – but whilst we recognise the importance of difference arising from different political priorities, we should look for this to be a positive decision and not the consequence of historical evolution of services.

iv) Service resilience – is there sufficient capacity in each service-providing organisation to avoid problems arising from staff turnover, adequate

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access to specialist expertise, sufficient staff for normal operational pressures, or capacity in times of emergency or crisis?

v) Service redesign – delivering a different but better service. An illustration of this would be the Connecting Families project in Bridgend. This is an Local Service Board sponsored initiative developing a model of service to address the needs and behaviours of those families who place most demands on public services and who have a disproportionate impact upon the communities in which they live.

vi) Market making – enabling authorities to better engage with maturing the market, ensuring that they have access to the right information at the right time to enable intelligent and effective engagement and commissioning. We endorse the Minister for Business and Budgets in her call for a strategy to foster Welsh supply chains.

2.4 Whatever is the driver of the collaboration, the consequences of these changes are likely to impact on the organisation of commissioning, procurement and delivery.

Principle 2: Focus on functions not whole services

2.5 One solution to our terms of reference would simply be to consider the wholesale transfer of services from one level to another, for example aggregating local to regional and regional to national. However, this is a fairly crude solution that does not recognise the complexities of local authority business. A better approach is to examine which aspects of a particular service are best delivered at any level.

2.6 This approach is more pragmatic and allows for a more open analysis of existing structures that takes into account the complex and varying relationships and geography of the country. We do not seek to lay out strict rules for what should be delivered where to avoid costly and time consuming legal and governance arrangements.

2.7 To expand on this point, let us take the employment of an individual to undertake a task. The cost of employing that person falls to a local authority. The supporting payroll functions could be aggregated regionally. As there are eight pension schemes operating across Wales currently, this is already happening to an extent and many of the terms and conditions of employment are negotiated nationally. In other words, there are four different spatial levels involved in this simple example: local task delivery, local employment, regional

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pension provision and national terms and conditions. To suggest that there could be further changes (eg a further consolidation of pension schemes) is a proposal to realign an element of this, but not a wholesale service reorganisation.

2.8 In some cases there may be compelling reasons for a large-scale reorganisation of services but the evidence of such reorganisations is pretty clear. In most cases the energy involved in doing the reorganisation is so great as to distract from a ruthless focus on service delivery, which is what is needed.

2.9 There is a second reason for our focus on functions rather than just services. Local government is increasingly as involved in the commissioning of services as in direct delivery and we believe that this will become a more commonplace approach in Wales in the medium term. This is already particularly true in social services.

2.10 When we look at aspects of service requirements we find that some are best delivered very locally, such as child care. However, at the more complex and specialised end of the service spectrum where numbers of clients might be fewer and the specialisms and knowledge required to deal with them much more specific, the effective solution in terms of service quality and economy would be regional provision. Examples here might include specialist adoption and fostering services.

2.11 Some commissioning could involve national delivery, such as secure provision for disturbed young people. In these cases not only is the concept of total local delivery not possible, but we see considerable advantages in commissioning operating at the most appropriate strategic level.

2.12 Furthermore, we find that it may be worth using procurement, commissioning and delivery as more useful areas to delineate provision along the lines of function. This could mean that procurement can be done on a national scale, allowing for commissioning to take place on a collaborative, and/or regional level and delivery to take place locally, allowing for the particularities of a place to be accounted for. In this way, there are built-in allowances for the increasing discretion needed as one moves nearer the point of delivery. This is a point that arises throughout all service areas and one that should be kept in mind when thinking about potential changes.

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Principle 3: It is about better collaboration not just hard geography

2.13 Working collaboratively can be beneficial for a number of reasons. It can reduce working costs and improve working relations because it makes it easier to provide a well-balanced and directed service with fewer resources. This is in part because organisations will be focused on a single goal and all effort can be focused on realising it. Collaboration can also help innovation flourish more easily in the workplace as skills and expertise are aggregated and the workforce grows increasingly flexible and resilient. Finally, joined up working and more directed outcomes can have a greater momentum behind them to get things done as there are multiple organisations’ needs represented.

2.14 Whilst it may be desirable to create a ‘simple’ solution of perhaps four regional groupings of local authorities with each delivering a range of back office services, we should instead focus on how we can tackle the existing complexity in a pragmatic and straightforward manner.

2.15 We have found that in terms of the breadth of local authority services there is no such thing as a single “right size” for the delivery of all local authority services or functions. In reality there are different geographic dimensions for different issues – and this is something we understand in our own lives. Other reviews in specific service areas support this view – for example the outcomes of the recent Social Services Commission which we discuss later. For example, the aspiration of an urban parent is to have a good primary school within walking distance of their house. Yet few of us would regard it as an enhancement to live within walking distance of a major airport (though we might well regard living not too far from one as a benefit). As citizens, we understand living with variable geography, so we should not elevate the importance of bureaucratic simplicity over approaches and configurations that are likely to deliver better results.

2.16 Secondly, not all collaborations need to be based on geographic proximity. Some will be based on geographic similarities. Coastal erosion is an important issue for coastal areas be they in north, west or south Wales, whilst urban planning expertise is something urban authorities might share irrespective of their geographic proximity. However, commonality of socio-economic conditions and service challenges also present a set of themes that can create a powerful common platform from which authorities can work.

2.17 Thirdly, we recognise that there should be the potential for coalitions of the willing. In fact, experience shows that willingness and personalities are key drivers in spanning organisational boundaries. If we are not to have the pace of innovation controlled by the slowest, we need to encourage collaboration where

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this can deliver mutual learning and challenge and development of new practice. The best must be prepared to lead and invest with their peers.

2.18 Fourthly, there can be timing reasons why non-geographical collaboration should be encouraged. For example, were we to seek to deliver savings in payroll functions we would need to recognise the incompatibility between existing payroll systems and also that their initial purchase was not made on a geographic basis. One payroll system for Welsh local government would be a good midterm proposition, but it would be achieved by first reducing the number of independent contracts. These developments can still be made but must be achieved over the longer term through natural organisational change within a national – or regional – strategic context. However, that context would need to be defined very clearly and those within the region must stick to it. Further, advancements in technology (i.e. cloud computing) increasingly make working across geographical areas less complicated.

2.19 Finally there are strong competition grounds for ensuring some diversity of supply in any area. We can see from some services (e.g. refuse collection in England) that the range of potential suppliers has contracted to such a degree and with very high entry costs preventing new companies joining the market that costs have now begun to escalate well ahead of inflation in many areas with few competitive checks and balances left in the system.

2.20 To state these points is not to undermine the importance of geographic collaboration, but to remind us that collaboration must be for a purpose. What we need is change achieved at a pace. It is right for Ministers to ask for the evidence that this is happening. That there should be change is a clear WAG imperative. How the collaborations are delivered should reflect local priorities and circumstances. But as a guiding principle we endorse the Sustainable Social Services: A Framework for Action paper when it says “We want to change the question from ‘how might we collaborate across boundaries?’ to justifying why not”.

Principle 4: Collaboration can take many forms

2.21 There is more than one type of collaboration with one type of purpose. For example, there are

• ‘collaborative’ arrangements that exist to share experience amongst other organisations that continue to work separately;

• joint plans that multiple authorities might agree on;

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• shared procurement arrangements between authorities to reduce the costs of goods and services; and

• shared delivery such as that of shared highway resources.

2.22 These are just some of the different ways that authorities and other public service bodies can work together to improve services at reduced costs for citizens.

2.23 This review is neutral on outsourcing as a chosen form of collaboration, but one of the major reasons for outsourcing is to achieve greater economies of scale. It is worth noting that ‘insourcing’ or sharing teams and resources amongst local authorities, can offer many of the same benefits and increased economies of scale with fewer of the challenges and pitfalls, as these economies are not only about pooling resources, but also about effort and managerial time.

2.24 It follows that different issues will require different solutions. We are advocating a presumption of collaboration in many areas of service commissioning and delivery, but how that presumption materialises will vary issue to issue. In the same way that a rigid focus on fixed geographic boundaries will not deliver the enhancements and savings required, similarly merely proposing one mechanism for better collaboration would be equally unsuccessful.

2.25 “Form should follow function” is the key management mantra to describe this argument. Proper understanding of the function and the outcomes desired should inform the decision about the best type of collaboration for each issue.

2.26 Such collaboration is not always easy and will be affected by the people involved. There are certain things that should be considered and worked through to ensure more successful outcomes. Much of this is as simple as communication: communicating who is responsible for shaping the collaboration and communicating what the purpose of the collaborative agreement is, both to those involved and to those who may otherwise feel excluded. Strong leadership is also required as Principles Five and Six will demonstrate. In recognising the potential challenges we should remember that quite often the key challenges are cultural and not structural - so early investment in addressing cultural alignment may be the precursor of much larger structural alignment in due course.

2.27 We recognise the laudable collaborative work that has been done across Wales to date. This has been helped by the WLGA regional boards, the education and transport consortia and other dedicated individuals throughout local government. Where there have been successes these should be built on and in

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some cases used as the groundwork for further collaborative projects and joint working arrangements.

2.28 We would also stress that such collaborations should not be seen as occurring purely within local government. Many of the major challenges require better collaboration between public bodies within an area, as much as collaboration beyond existing geographic boundaries.

Principle 5: Local accountability and freedoms must be enhanced and not diminished through the process

2.29 Some have suggested that the development of regional collaborations would be at the expense of local freedom to react and respond to their particular needs in an appropriate way, whilst remaining accountable to their citizens. This is an important issue. However the development of a regional level of collaboration should not of itself reduce, restrict or unduly complicate local freedoms and accountability.

2.30 It is possible to agree different levels of service organisation whilst still allowing local determination as to how that is applied or funded. To take a higher education example: we have a clear understanding in the United Kingdom about what comprises higher education and what level of qualifications are required to enter higher education generally. Yet each University is free to set its own admission requirements for each course as they deem appropriate and, increasingly, in future will also be setting individual levels of fees

2.31 In local government there has been considerable comment about perceived differences between authorities in assessments for adult social care. Families also question why they need to be reassessed if they move from one area to another. It would be perfectly possible to have an assessment process that was agreed across Wales, whilst still leaving each authority the decision about the levels of support any assessment would trigger. The Social Services Paper has addressed this issue, and while it is not for us to comment on whether or not there should be an all-Wales entitlement, we wish to emphasise that having a shared assessment does not necessitate a shared entitlement or shared mechanisms for delivery. To give a private sector analogy, two employers could agree on a common assessment process for staff recruitment (quite often outsourced) but how many staff each firm would employ would depend on their respective circumstances.

2.32 However, there does need to be greater clarity as to the governance arrangements for collaborations. We need to ensure that we achieve local

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accountability, whilst avoiding ‘alphabet soup’ type arrangements of different permutations of meetings covering parallel agendas. We will be addressing proposed new governance arrangements further on in the report.

Principle 6: We have to ask the right questions

2.33 From the evidence we have seen, the question is not whether it is possible for there to be greater collaboration. The evidence from the Reference Group and discussions we have had with colleagues across Wales shows that it is quite clear there is considerable appetite for more collaboration. We have been impressed by the existing and considerable practice of collaboration that is already happening or being actively planned. The question is not therefore simply a technical one such as are there areas of delivery which could be improved by a different configuration; but given the evidence of the benefits and the seeming willingness of parties to start on such collaborations, how do we generate greater pace, a more strategic and coordinated approach as well the evidence of significant achievement.

2.34 Putting this question another way, this is not a managerial question about what is possible but clearly a leadership question about how local government can deliver the acceleration in pace and aspiration to deliver these changes and do so within a defined time period.

2.35 Later, we detail areas where we think the greatest improvement is possible. But, we believe the greatest attention should be given to the leadership challenges associated with achieving his change. Although detailed cost benefit analyses of each specific aspect are important, experience shows that this can itself quickly become the focus of the project rather than just a means to the end. Good quality leadership – political and organisational – is essential to maintain the right focus and avoid this happening.

2.36 There is however a further dimension to asking the right question. If the framework is about delivering better and better value services to citizens and users then we should not see this purely through the lens of what services presently happen to be delivered by local government, rather than some other part of the public sector. Citizens have a right to expect the best possible public services, delivered in the most efficient manner. They should not need to have to understand the complex organisation of public services.

2.37 To achieve the maximum impact we must operate from the perspective of citizen and user and deliver changes which enhance that experience. This is not a simple win/lose analogy where local government takes over other functions

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from other bodies: it is about designing systems of public service delivery which drive out waste and duplication and which enhance the quality of the offer to the citizen and user. This offer may well result in a changing relationship between the citizen and the local authority.

2.38 Therefore whilst the main focus of this report is about new configurations of commissioning and delivery across local government, we would recommend that this should be widened to also include those service areas where there is engagement across the public sector, such as early intervention, complex families, adult social and health care.

Principle 7: Leadership to deliver the change 

2.39 We have already commented that we regard change to be at least as much a leadership challenge as a management one. Thus local government will need sustained managerial commitment and engagement, as well as the determination to address the leadership challenges. In this way, managers, employees and political leaders at all levels need to be engaged in the process.

2.40 One of the keys to making this change will be active political leadership. Local

government leaders need to create the culture for the change. Simultaneously they need to convince the Assembly Government that this time there will be sustained change. And the Assembly Government needs to provide the strategic context and end point towards which that change can drive.

2.41 But this change goes beyond the political leaders of the council, or indeed the

leading councillors. What is being proposed will have radical impact on the roles of all councillors. For leaders to be able to engage councillors as a whole they need to have a story about the change and how the change will enhance democratic accountability. That story must be an integral part of the change process so that councillors see it as positive and that power is not being moved further away from them. Therefore, this change is also about enabling councillors to better focus on their roles as champions of citizens and communities and holding those who deliver services better to account.

2.42 Central to this leadership challenge is the active engagement of elected members and the demonstration by them of their commitment to the changes required. Inevitably this will involve changes in what elected members do. In chapter 5 we comment on the need for governance arrangements that can deal with the new collaborations that are not seen as simply maintaining the parochial status quo. But equally this should also free up time for members to

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concentrate further on their role as community champions for the areas they represent.

2.43 May 2012 will bring the next round of local authority elections to Wales. We believe it is important for there to be a clear endorsement of these changes well in advance of those elections. That would have two benefits: first it helps signal to potential candidates and, where appropriate, to the political groupings they represent, the changing role expected of councillors. Secondly, it gives a timetable allowing local authorities to prepare a member induction programme, which helps them deal with the new challenges, rather than merely continue old practices.

2.44 We are pleased that this emphasis on the importance of leadership has been highlighted in parallel reviews. It is vital that the leadership challenge is viewed holistically. If we are to make a transformative change in Wales then we need to do so across local and national government and, indeed, in some cases across Welsh public services, and not merely have a series of silo driven initiatives to achieve this.

Principle 8: Engaging staff is critical

2.45 A frequent reason given as to why change programmes fail is that whilst there was enthusiasm at senior level, momentum was lost when rollout was attempted across the organisation. This characterises staff as a barrier rather than an enabler for change. That way of describing the difficulty also identifies the problem in the thinking. Staff are not the enemy of change - they are the greatest resource any local authority has.

2.46 It is not surprising that proposals which could result in changes to the work of staff will mean that many may feel uncomfortable or challenged by that process. The solution is not to regard the staff as the problem, but to actively engage them in the design of the new solutions. After all, few people started work in public service with the aim of being as unproductive as possible. The outcome of the changes we propose is that there should be greater staff satisfaction as a result of change, as more staff time can be spent doing something meaningful. The recently announced Memorandum of Understanding between the WLGA and trades unions gives a framework within which these changes can proceed.

2.47 While strong political and managerial leadership are important in this process, one cannot deny the importance of capacity within the system. When commitments are made by leaders, the implementation will need to be done by staff. Part of the challenge is to engage staff in the process and focus on

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improving the skills they will need to work successfully in a new, more collaborative, environment. Critical therefore to the next steps must be an assessment about the available capacity for change – and a strategy to ensure that there is sufficient capacity to achieve the scale of change required.

Principle 9: A Compact with consequences

2.48 Reports are easily written and then forgotten as new challenges focus political and managerial attention. We believe the key to success of moving ahead with a vigorous programme of strategic collaboration is a very public declaration of the commitment to that programme. We suggest that there should be a clear Compact for Change that would be signed by the Assembly Government and the WLGA.

2.49 This Compact should detail what success for the programme will look like and outline a timeline for achieving it that recognises the scale of the task and staggers it appropriately. This timeline should be realistic in that it identifies that some changes will take place over the longer term but remains sufficiently challenging so that complacency is not an option. We also recommend that the relevant professional associations should similarly commit to engage in the Compact, which should be a publicly available document. If the agreed plans outlined in that document are not met, then we recommend that the Assembly Government will utilise the levers and powers available to them, described in chapter 5, to make that change happen.

2.50 Clearly, part of this Compact should be a clear agreement about what would constitute success – so there can be a shared view of the journey to be undertaken and a shared view of the destination. Over time there will be further new challenges, but for the first phase a clearly understood common view of success will increase the likelihood of achieving it.

Principle 10: Supporting the change to deliver the change

2.51 Change does not happen by accident. To deliver the change will require some support. We do not believe that a wholesale “invest to save” strategy is required not least because the history of many such strategies is considerable investment, but less evidence of any resulting savings. However some such investment will be necessary. These will be of two different types:

i) There will be occasions where there is a financial saving to the whole sector which would be achieved by greater collaboration, but for at least some of the authorities the initial cost to them would be much greater

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than any resulting saving. This is a typical problem involving any software collaborations for instance. We propose that Assembly Government continue to act as a long-term banker to smooth out costs which would otherwise be a short-term deterrent to investment.

ii) For some of the key changes there will need to be investment to help

support addressing the associated cultural challenges. We are asking for behaviour change and not just technical reorganisation - and to achieve the former we need the active engagement of staff which means a focus on culture and values as well as management and leadership. An example to demonstrate the importance can be taken from many private sector mergers. These can often fail to deliver the promised benefits to shareholders. In some cases of course, these are mergers where there was no financial sense except to the advisers; however, in most cases the reason is that all the energy went into the “deal” (did they overpay underpay, what were the terms etc) whilst the challenges of integrating different cultures (and perhaps producing a new culture altogether) are not properly addressed.

2.52 We cannot stress this enough. If this agenda is seen as a purely technical one,

rearranging some reporting lines and relocating some staff, it will not deliver the changes needed. What we are highlighting are changes which will deliver a better service to citizens, by delivering services differently.

2.53 In order to deliver this, we will need to have champions for change. Both the

WLGA and Solace Wales have demonstrated their commitment to developing greater collaboration and better ways of working. We believe that the Assembly Government should recognise this by giving both the political and financial support to help deliver the change. We have some of this infrastructure already in place. We need to build on the existing WLGA partnership structures. We also have governance arrangements already in hand for these.

2.54 Part of this process, and setting accountability for the delivering on the Compact, should be an annual report back to WAG accounting for the progress made. We propose that there be at least an annual report to the Local Government Partnership Council. Relevant Assembly Government officials together with those from the WLGA should act as the joint secretariat for that report.

2.55 We do not see strong strategic leadership by the Assembly Government to be in conflict with strong local leadership by Welsh local government. The establishment of the Welsh Assembly has enabled distinctive Welsh

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approaches and solutions to the challenges facing Wales to be developed and the forthcoming Assembly elections will again provide an opportunity for a restatement of Welsh solutions. Welsh local government should collectively engage in this endeavour to deliver distinctive solutions for public services which acknowledge both the ability for an all-Wales dimension as articulated by the national political leadership in the Assembly Government, regional collaboration and local solutions to local problems.

2.56 This review is therefore recommending not only a radical refresh of what is local, regional and national. It also believes that it creates the opportunity for a renewed commitment to making real the opportunity for a better recognition that strong national leadership by the Assembly Government and strong local leadership by Welsh local government should not be in conflict with each other but should reinforce each other. And it is suggesting that there needs to be a clear national vision set out which provides the framework for a new mechanism of robust and vigorous accountability through the Local Government Partnership Council.

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3. Local, Regional or National: the Big Ask 3.1 If we use these ten principles as a guide for driving improved performance and

delivery, we then need to address what the changes required could be. What follows is a list of proposed service reconfigurations, broken down by the relevant service area.

Social Services 3.2 The Independent Commission on Social Services, put in place by the Deputy

Minister for Social Services, reported in November 2010. And on 17 February the Assembly Government published its major policy paper Sustainable Social Services for Wales – a Framework for Action. The paper will lead to significant changes in the way social services are planned, commissioned and delivered in Wales. Where necessary the Government has stated that it will legislate to underpin the changes that are required.

The WLGA has also recently published a paper on social services

3.3 We find that a number of good and radical options have been put forward. The Minister has issued a clear challenge to local government to deliver a response and local government needs to respond to that with a demonstration of its willingness to face the very real changes ahead. As mentioned earlier in this review, the division between procurement, commissioning and delivery at different aggregations and levels is highly relevant here and fully in line with our more broadly based analysis.

3.4 The WLGA paper found that individual councils should be responsible for determining how best to meet their statutory duties and that this could be best done by having “a menu for collaborative activity”, rather than a prescription for local places to implement. Also, it is on this point that there is a clear division to be made between a function being delivered locally and managed by local arrangements and functions delivered locally but managed collectively on behalf of several ‘clients’. Such a shift in places can cause anxiety on the part of service providers; however, with robust governance and quality assurance arrangements in place, this can be minimised.

3.5 We want to support the shift set out by the Government and enable local government to respond to the challenge set out to them. We make the following operational proposals for areas where functions can join up but acknowledge that these must fit into the broader framework set out in the Government’s published policy.

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• Procurement of high-cost packages of care. For example, residential and specialist dementia care, specialist placements for looked after children, mental health and learning disability.

• Procurement of aids and adaptations and specialist equipment with the

potential for an all-Wales store that recycles and adapts complex children’s community equipment.

• Domiciliary care - delivered locally but managed and procured through

consortiums. • Tele care schemes that provide a range of assisted technology and

security systems for individual homes, linked to a comprehensive alert and management service for managing risk and promoting greater independence.

• Emergency duty teams that provide collaborative out-of-hours services. • Respite and short breaks commissioned and managed through consortia.

3.6 With reference to the systems in support of social services provision we

recommend that there should be collaboration with reference to:

• Specialist legal advice for costly and highly specialised legal advice. At a minimum through collaborations but could be commissioned once for Wales

• Administration of direct payments through collaborations

• Complaints and investigations. We propose a two tiered approach for this

function with the initial phase conducted locally and then if appropriate, the second stage conducted through a consortium arrangement

• IT systems. We should move over time to one system for social services.

As contracts for maintenance expire, a new system should be procured that meets the demands of future social services and provides greater synergy and connectivity with the NHS. All current social services systems were designed several years ago and in our view are not suitable for future investment.

• Social work training and recruitment. There is a solid history of

partnership to share opportunities for training and delivery of ongoing staff development support. Further opportunities exist to streamline arrangements. We note that recruitment of social workers and agency staff is already featuring as opportunities to collaborate and we believe they should be fast tracked.

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• Production of information leaflets and material which outlines statutory rights and changes to the law should be produced once for the whole of Wales and only if necessary embellished with local additional information.

• Activities relating to assessment and care management should remain

locally based.

3.7 Of crucial importance in the delivery of social care is the cross-sectoral collaboration with organisations concerned with health care, housing and public protection. This collaboration needs to take place at a variety of levels:

• There needs to be shared service planning arrangements between health and social care on the geography of the local health boards.

• There needs to be commissioning arrangements which include health and social care often on a geography larger than the local health boards.

3.8 In addition to the list of functions above, there are also some areas where it is possible and desirable to collaborate beyond local government, with partner agencies such as the NHS. This is relevant in a number of service areas and the complexity and interrelatedness of the issues pertaining to social services makes it particularly so.

3.9 There have been a number of examples of councils working toward such agreements. For example, the six North Wales councils have announced plans to form a procurement hub for high-cost services and there are opportunities within this to partner with the Health Board to focus on high-cost social care and NHS residential care. A further example to be looked at is the Gwent project “Happily Independent”, which is looking at creating an integrated model of care that is community based, and includes five councils and a health board.

3.10 Other areas have shared staff between a local authority and a health board with good results. For instance, Pembrokeshire County Council has a shared Director with the local Hywel Dda Health Board that has been very successful in terms of reduced salary costs, but also in improved working relationships between the two bodies. The success of this can be judged by the fact that the collaboration now reaches all the way through to frontline staff and the next step is to consider a single management team between the two bodies as well as establishing a joint communications hub that will help target their services more effectively.

3.11 There is a clear need to continue to drive forward the agenda around complex families and the work being done through the pioneer Integrated Family Support Teams is an important aspect of that. The political relationships along with the

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favourable local government settlement put Wales in a strong position to build on the already good relationships established through Local Service Boards and to make great progress in speeding up collaborative activity at the broadest level.

3.12 However we again stress the importance of accepting variable geography. Geographic alignment of different public agencies is attractive in principle, but the different dynamics and focuses of individual organisations can make this problematic in practice. In this case, social services need to interact with agencies all operating at a number of different spatial levels, health, police and the criminal justice system for instance.

We recommend that arrangements for collaborative procurement in social services are put in place across Wales for the procurement of high cost care packages for looked after children, mental health and learning disability, domiciliary care, tele-care, emergency duty teams and respite care. We recommend that there be collaborative provision of support services for social care in the areas of specialist legal advice, direct payments, administration, IT systems, complaints and investigations, and social work training and recruitment. Education and the needs of the learner

3.13 The Minister for Children, Education and Lifelong Learning has commissioned a report to look at education delivery which is due in late March 2011. We are not going to second guess the findings in this review; however, we do assume that it will recommend a number of major changes. We also anticipate that the review will focus strongly on better addressing the needs of the learner. We welcome this and believe that such an approach parallels our focus on the needs of users.

3.14 Wales recognises that it has a major challenge in ensuring that its levels of

educational attainment are at least comparable with its competitors in the world economy. It is recognised that a society and economy has no greater asset than the skills and learning capacity of its people. It is therefore understood throughout the education community that all the resources that support the learning that takes place in local schools, colleges and workplaces needs to be organised in ways to ensure that scarce expertise and specialist resources are shared and administrative costs are reduced.

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3.15 We note that there has already been progress towards better collaborative working through regional consortia and the professional networks. Following the publication of the education review we encourage Welsh local authorities to respond positively by demonstrating a willingness to advance collaboration at a greater pace. In advance of any formal WAG response to the review we would also recommend that these preparations for enhanced collaboration are completed over the next year and implemented during 2012-13 so that the momentum for change is not merely maintained but enhanced. Such a timetable would also fit with other recommendations in this report by enabling a comprehensive assessment of the rate of change.

3.16 Amongst the issues that the education review will address we would anticipate

attention on better sharing of robust systems of performance information; support for education improvement in schools; and support for leadership development within schools and governing bodies. In looking at better commissioning systems for Additional Learning Needs we will need a comprehensive picture, recognising that there are healthy and social services perspectives – but what is needed is an approach which puts the child and the family at the centre of the focus.

3.17 There is a recognised need to plan and communicate pathways for lifelong

learning. The education review’s formal brief in this regard encompassed in particular schools and colleges, however higher education and workplaces are also critical. We would expect that the education review would recommend that existing arrangements to establish regional, cross-sectoral collaboration need to be strengthened and transferred across the whole of Wales.

Education – administrative and transactional services

3.18 Like every other service delivered by local authorities, there are many aspects of education that are more administrative or transactional in nature. We have been keen to see how such services could often be better configured. As with any other area of activity, better such configuration can deliver up savings which allow more resources to be focused on meeting the needs of (in this case) the learner. We believe the following areas could benefit from a different configuration.

• Transactional services such as cleaning, transport and catering.

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• Special education needs (SEN) and high-end placements are a key area where savings through joint procurement can be found. This will also involve health and social services.

• Procurement of service contracts such as cleaning and catering

• Arrangements for human resource management and asset management wherever business planning demonstrates an economy of scale (this is not to say that this area should be limited to sharing within education)

3.19 There are a number of opportunities for doing things nationally within education. The following represents a number of the areas that we believe could be run more effectively either regionally or on an all Wales level.

• Administrative services such as student grants and ICT procurement could be run together for all 22 authorities and potentially with other public sector bodies as well. A current example of the possible savings here is witnessed in Newport’s outsourcing of their student grant administration to Cardiff. They have saved £90,000 per annum with this project and it could certainly be scaled up, as well as across to other service areas.

• Specialist HR functions. Whilst local authorities are the employers of school staff, there are distinctive HR features of school employment which suggest some element of coordinated expertise would be more effective.

3.20 As an illustration of present joint working we cite the work in both South and North Wales. For instance, the North Wales region has created four specialist member-officer collaboration boards to programme manage a range of chosen services. There has been an early concentration on education and social services given the scale of their direct and indirect spend including commissioning and procurement spend. Similar plans are underway in other areas. South West and Mid Wales Consortia intend to phase in a model of collaborative working from September 2011. In the South East Wales Consortium, school improvement services will be integrated into one by April 2012.

3.21 A key project for education is the transforming education-school improvement services collaborative which brings together all six councils in the region. Led by Denbighshire the collaborations task is to improve the quality of support services to schools whilst achieving efficiency savings of 10-15% of all total spend. The integrated service model, which will be fully operable from

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September 2012, includes all curriculum and specialist advisory services with shared IT and support systems and functions.

We recommend that existing preparations for enhanced collaboration in education services (and likely related recommendations from the education review) are completed over the next year and implemented during 2012-13.

We recommend that the administration of student grants be organised at a national level.

Regeneration, the environment and waste management 3.22 There are many well established examples of local authorities collaborating in

these areas, following local investigation and negotiation around the finer details. It is noted that in this area a simplistic universal approach based on geographic proximity would be ill-advised. Current examples of existing collaboration which provide an indication of future opportunities include:

• Strategy, plan formation and delivery within transport, planning, tourism and flood management are all coordinated by local authorities on a regional and national level. This includes the Regional Transport plans developed by the four transport consortia, the regeneration plans developed by the collaborative regeneration areas, as well as the collaborative work with the Assembly Government and Department of Work and Pensions around delivering market support to the unemployed.

• Flood and water issues are inherently cross border and typically require consideration, for example, at river catchment area level or for whole stretches of shorelines. New responsibilities on local authorities arising from the Flood Risk Regulations and Flood and Water Management Act will result in detailed work on flood risk assessment, hazard mapping and management plans. These are specialist functions and the benefits of authorities sharing expertise at a regional level are well recognised. At a national level WLGA is co-ordinating information and liaising with WAG and the Environment Agency. There are plans to support the development of regional working over the coming year and beyond.

• The project development and implementation around European programme delivery has been done collaboratively in a number of areas, including some examples of new regional governance arrangements.

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• Procurement around food waste and residual treatment facilities, which are overseen by Inter Authority Agreements.

• Sharing of specialist staff, particularly in areas such as minerals planning but increasingly the opportunities are being seen in wider areas including architects, engineers and enforcement officers. In Conwy and Denbighshire there is already a joint Head of Highways who has brought together a number of activities such as street lighting and maintenance into a ‘single service’.

• Within the area of transport, we find examples in England of successful collaboration leading to savings. The Midlands Highways Alliance, a partnership between a number of councils and the Highways Agency have worked together to develop collaborative procurement frameworks and share best practice. This has led to considerable savings and they are on target to save £16.75 million by 2013. Wales in a good position to adopt a similar partnership approach, potentially along the lines of the Regional Transport Consortia, which are already in place and have made savings through increased economies of scale, shared best practice and shared management teams.

3.23 An illustration of collaboration on transport is the four transport consortia whose main functions are to prepare and champion regional transportation policies, strategies, plans and programmes; seek funding to implement those plans and programmes; responding to consultation documents with a regional dimension and working with member councils and other partners on regional transportation issues

3.24 As an illustration about how waste management could be improved we cite the long term partnership that Bridgend entered with waste contractor May Gurney. Bridgend is also part of a collaborative project to procure an anaerobic digestion facility to treat food waste. A regional hub has been developed in partnership with Neath Port Talbot, Swansea, Carmarthenshire and Pembrokeshire Councils. The new facility will provide savings in waste disposal, reduce carbon emissions and generate energy. Tenders have been invited from companies to provide a facility, which should be fully functional by April 2014.

We recommend that the procurement of facilities for the management and re-use of waste be organised collaboratively by local authorities.

We recommend that the planning, management and delivery of strategic highways be organised collaboratively at a regional level.

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We recommend that architectural and specialist engineering services be organised collaboratively at a regional level.

Planning services 3.25 Within planning services, we looked at the specific areas of specialised

planning, validation and local development services which show opportunities for greater collaboration and/or rationalisation. In many of these there is already work in hand which shows the potential for both service benefits and cost reduction. Examples include specialist areas such as minerals, ecology, managing the historic environment; and building control where there is great potential for developing regional ties. In most of these areas expertise and resources could be pooled effectively in order to strengthen and deepen the resources and skills available that can be shared when needed.

3.26 We also consider that in general more could be made of this shared specialist expertise which itself could generate a strong and highly cost effective use of resources within the sector. Doing so would also encourage local authorities to first look to each other to identify opportunities for collaboration before going to the open market.

3.27 At a wider level, Local Development Plans (LDPs) are currently being developed and in place in some areas. These sit within the context of the Wales Spatial Plan and it makes sense that while clearly local in focus, the plans are developed with reference to one another and the broader objectives of the Spatial Plan area. Bringing LDPs close together in this way would provide a path for increased efficiency at reduced cost.

3.28 The barrier to greater collaboration on some of the issues outlined above is that many of them are running on different cycles. It is therefore difficult to join with appropriate partners at a suitable time. If this can be overcome, and the Assembly Government has a clear leadership role here, then the result will be a more flexible workforce developed over time through creating specialist teams that can be deployed in different areas to develop and deliver own LDPs as needed.

3.29 On a national level, this review finds that there is merit in rationalising validation and agreeing one all-encompassing set of planning standards and approaches. Currently, developers have 25 different approaches to contend with. A single approach means that engagement between the public and private sector will be easier, cheaper and more consistent. It follows that skills and expertise are then

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more transferable and can be easily pooled across the system. While standardisation for validation could be done nationally, there is a case for leaving the practical validation of applications at a local level in order to recognise discretion around local circumstances.

3.30 Adopting a system such as the Advisory Team for Large Applications (ATLAS) model in England for major planning applications has proven benefits. The model has provided an efficient, effective and consistent approach to dealing with major schemes on a national level.

3.31 While there is scope for national delivery of some functions, the importance of local knowledge is not to be forgotten and should be taken advantage of where appropriate. Beyond that we found that mainstream planning should continue to be delivered on a local basis because of the need for accountability, public engagement, policies and priorities.

3.32 There is a fair amount of work already being done in some of these areas. For instance, in the area of shared specialist services, the North Wales authorities have already made a start. Flintshire County Council has set up a shared service for minerals and waste planning to regulate planning permission for quarries and waste disposal sites. Its aim has been to increase the resilience of its services by improving and better utilising in-sector skills, as well as making financial savings with efficiency gains and by a decreased reliance on the private sector.

3.33 The financial savings are expected to come from less contracting out work to the private sector as well some income from site monitoring. Further, the six councils in North Wales are looking at further areas for sharing expertise, namely around bio-diversity, landscape architecture, tree management and buildings conservation. The expected efficiency savings are expected to be £1.5m at 10% range maximum (noting that this is an income generated service and with specific grant support).

3.34 Furthermore, in planning, the possibility of a national system for dealing with the administrative side of planning applications has been raised as a possibility along with other areas where there is potential for harmonisation of processes. These developments are in line with recommendations of the Grimley review of planning, linked to the Assembly Government’s Economic Renewal Programme. We believe there is potential for even greater coordination in work with Europe.

We recommend that the mineral planning service and other specialist planning services be organised on a national level.

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We recommend that a national resource of planning expertise be established so as to enable the public sector to make best use of its own expertise, avoiding expensive private sector input. This should include a standardisation of planning application standards and requirements at a national level, whilst maintaining the practical validation of applications at a local level.

Corporate services 3.35 The umbrella of corporate services covers a range of office support areas

including finance, legal, Human Resources (HR) and Information and Communication Technology (ICT). In our research, we found that there was a good deal of existing sub-regional collaboration as well as a recognition that in many cases two or three authorities are much more able to act in an efficient and adaptable manner than seven or eight. We should therefore not drive aggregation for the sake of it, especially where it can be shown that robust and credible alternatives exist which could also deliver savings and better services.

3.36 A simple illustration of administrative efficiency is the WLGA’s European Office in Brussels which is sponsored by the 22 authorities. This is an example of a national solution which avoids wasteful duplication of effort by individual authorities.

3.37 Within finance, legal services and HR it is proposed that the following functions are maintained on a local level.

• Financial advice, whilst being aligned to services, must be delivered on a local level. Likewise, statutory accounts will continue to need to be produced individually.

• Audit services also need to be delivered locally. But it is possible that sub-regional groupings may be appropriate in some instances. As an example in January 2010 Bridgend and Vale of Glamorgan councils agreed to share the role of chief internal auditor, with a view to developing a shared service. This has now resulted in the model being developed into a fully integrated service, where the whole staff team will be employed by one authority but located in the other. Cost savings and service benefits have been demonstrated by the project.

3.38 We also found that there is a preference towards regional or collaborative structures and arrangements. It is proposed that:

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• Transactional services and systems within accountancy can be provided collaboratively. Exchequer functions, such as bills payable and receivable, could potentially be included under the banner of transactional services, again on a regional or collaborative level.

• Payroll could be consolidated and provided for on a collaborative basis and ideally should be provided for by three or four systems, with an aim to transition to one system in time.

• Legal services should be delivered on a collaborative basis. This would allow the sharing of best practice, training and procurement exercises as well as maximising the use of in-house provision. There is already some experience of collaboration in this area: for instance in South and West Wales seven authorities have entered a collaborative agreement to develop a virtual shared legal service. The service commenced in April 2010 with Neath Port Talbot, Swansea, Carmarthenshire and Ceredigion Councils. Bridgend and Pembrokeshire have also joined.

• Staff training and transactional services can be provided on a sub-regional basis. Similarly, the all Wales recruitment system that was trialled by the WLGA should still be considered as an option for the future.

3.39 Pensions are currently provided for by eight local government pension funds. In March 2010, the pensions sub group of the Society of Welsh Treasurers representing the eight Local Government Pensions Scheme funds in Wales commissioned a study by PricewaterhouseCoopers (PwC). The aim was to build on the existing collaboration already undertaken in Wales and identify the potential for collaboration/partnership working across the Welsh Local Government Pension Schemes.

3.40 The initial study is now complete. It concludes that there is scope to generate further efficiency savings along with achieving greater consistency in service standards across both the administration and investment arms of fund management, such benefits being optimised through a reduction in the number of funds. The savings provisionally identified could well be seen as small in the context of the combined assets of the eight pensions funds (£7billion plus) but they are considered large enough to merit further investigative work. The study also recognised that any changes, whether at an organisational level or restricted to either investments or administration would be complex and would take time to achieve.

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3.41 Transition would also be complex and incur costs with payback periods varying according to the degree of change. It would also be a relatively long term exercise. The study however provides a sound base upon which conclusions could be reached and the pensions sub-group will be undertaking detailed work to produce an outline business plan around proposals for a reduction in the number of Welsh pension funds, the possibility of joint procurement opportunities and other efficiency measures.

Highly specialised areas, such as accountancy advice on VAT should be delivered on a regional or national level.

We recommend that there be collaboration between local authorities for the provision of a range of corporate services including payroll, pensions, legal services, and human resources that should, over time and in some instances, progress to national services.

3.42 The wider area ICT services has been looked at in some depth by the Efficiency and Innovation Board and the thinking points towards developing a national strategy for ICT provision across all public services in Wales. In the meantime organisations are working together to do things in one of the following ways:

• in common by design, where there are logical, technical and/or organisational imperatives;

• in common by agreement, where there are benefits such as value for money or citizen experience; and

• locally by agreement, where supporting local systems development in accordance with national standards which then become national solutions.

3.43 This is a good model which has established the basic principle for ICT services that all public service professionals and organisations should work together as the default option to do things 'Once for Wales'. This approach depends in part on strong leadership from the Assembly Government through the Efficiency and Innovation Programme and Board. Other potential developments (whose benefits are as yet untested or quantified) include:

• Capital budgets for ICT infrastructure investment should be pooled. However there may be different pools, depending on which particular regional functional collaboration is being considered.

• ICT systems should be architected, developed, procured, configured, deployed and maintained nationally but implemented and used

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regionally. It is possible to move towards this solution if driven by a clear strategic solution and timescale.

• In-house specialist skills should be widely shared and directed to national priorities.

• Currently, NHS Wales has begun to consolidate existing national ICT services into a single organisation called NHS Wales Informatics Services (NWIS). It would be sensible to use it as a platform for local government, schools, fire, police and others to join; rather than recreating a similar but separate body for each of the others.

3.44 ICT services that should be provided for on a regional and/or local level include project management and the implementation of these services. It is proposed that professionals from local government and from other sectors come together.

3.45 Examples of pan-sector collaboration in ICT are Powys County Council which is managing the Local Health Board's ICT function and a number of authorities in the south east of Wales where a regional broadband network has been designed that has shown savings through collaborative working across Health, local government and the Assembly Government.

We recommend that plans be developed and progress made in achieving collaboration in the collective procurement, system deployment and maintenance of ICT systems.

Procurement 3.46 The Efficiency and Innovation Board and Programme has begun to look in depth

at collaborative procurement and commissioning and identify areas in which the public sector can work together to save money. The report of the Efficiency and Innovation Procurement Taskforce published its review in February (Buying Smarter in Tougher Times). They have identified a target of £200m over 5 years With Welsh public sector spending being over £4.3 billion each year this is not an unreasonable amount. There are three streams that they have looked at as areas for potential savings: e-procurement, collaborative programmes, and policy focusing on best practice and guidance. On a national level they have established that:

• There should be one sourcing strategy for Wales.

• One procurement approach with one process and one set of documentation.

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• One economic development plan aligned to the public sector spend prospectus

3.47 A national eProcurement market has been established with tools and information sharing. It is called xchangewales and is based on the UK public sector service Zanzibar. It is currently used by 65-70 per cent of the public sector in Wales and wider adoption will increase savings. Indeed, use of the system has already been shown to produce savings. For example, across Welsh Government they have managed to negotiate rates down 35 per cent on their ICT contracts through working together. It is expected that the rates can be negotiated by a further five to ten per cent in the coming year.

3.48 Another specific example of the potential savings comes from schools in Gwynedd Council, who, through the eProcurement project is on target to make a net savings of around £500,000 by 2012-13, with projected savings of £43,000 in 2010-11 alone. Not only that, but because of the project, orders are now processed 60 per cent faster, with greater access to choice and lower prices. Teachers have shown more inclination to use the system as a result and prospects for other authorities from around Wales. This is a clear demonstration of reduced costs and improved outcomes.

3.49 The main barrier within this area is the lack of quality spending data, which is compounded by the lack of an agreement to standardise. Beyond that, there needs to be robust leadership to drive through the changes as the capacity of local authorities in the areas of procurement, negotiation and commissioning is variable.

3.50 The recommendations here again illustrate a key theme of this report: a focus on specific functions and not whole areas of activity. Thus there might be some superficial attractions in an all Wales procurement body, but we know that too great a distance between procurement and delivery creates its own inefficiencies. What we are recommending is a cascade approach. Within an all Wales strategy and information hub we can still have the flexibility and speed required to tailor local requirements.

3.51 We welcome the statement made by Jane Hutt, Minister for Business and Budget on the 18 February. We concur with her four key themes to deliver better procurement and commissioning. These are

• Capability (and staff development is also a key area for better collaborative working);

• E procurement;

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• Collaboration; and

• Fostering Welsh supply chains

3.52 We support the right of authorities to make political choices which lead to different priorities. But as we are clear there is value in having a default presumption that we should be aiming to simplify, standardise and share. An illustration of collaborative arrangements towards a different relationship with the private sector is the Capita Glamorgan Consultancy (Capita Symonds) joint venture agreement. This is managed by CGC’s own management team of directors and performance is reviewed quarterly by the Strategic Contract Management Board (SCMB). Each year a business plan is developed and approved by the joint venture board.

3.53 All parties have signed up to a services agreement containing partnering objectives and an arrangement to act in a co-operative and collaborative manner, and to share information openly and honestly. The SCMB is comprised of technical officers from each of the three authorities and a representative from Capita Glamorgan has been set up to monitor and review performance and service delivery.

We recommend that authorities consolidate and build upon existing arrangements for collaborative procurement based on shared approaches to contract documentation, standards and financial limits.

Public protection and regulatory services

3.54 Regulatory services run throughout a number of service areas and a key component in considering a different configuration of services should be to match the level of regulatory responses and resources to the type of risk posed. As there is an ever greater need for public service accountability, there is an ever greater importance placed on matching the costs and benefits of regulatory activity between those who incur the cost of enforcement, eg the local authority, and those who receive the benefit of the regulatory activity, eg national businesses.

3.55 To move to a system with ‘right level’ regulation means delivering services at the most appropriate level. Business representative groups have emphasised the importance of regulating at the most appropriate level as the greater efficiency of this approach allows resources to be released for services that genuinely need to be delivered at the most local level. Matching regulatory

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responses (such as co-regulation or self-regulation) and resources to the type of risk ensures a much more efficient use of Assembly Government funding.

3.56 There is also a question of what the Local Better Regulation Office refers to as ‘national threats’. A clear example of this is regarding ports of entry for consumer goods. This example is one that falls to a small number of local authority areas for the good reasons of geography, practicality and efficiency, despite the importance of the issue to the wider country or region. This causes problems when the resources of a place don’t match the scale of the issue. In this way, the disparity between ‘risk’ and ‘response’ should be addressed and dealt with.

3.57 Currently, three levels of regulatory delivery exist: local, cross-boundary or collaborative and national. Locally, we find that regulation should be in place in areas where local response can positively create safer, stronger and more prosperous local communities. Currently, this includes licensing decisions, food hygiene, and the services providing a one stop shop for advice and information to small businesses and consumers.

3.58 Cross-boundary regulation should exist where the risks involved cover more than one geographical area or require specialist resources that can’t be sustained in every local area. Within this category we include issues such as illegal money lending, control of flooding and provision of dedicated, and the provision of specialist equipment (eg anthrax burners).

3.59 National regulation should exist in areas that present a high hazard level, require very specialist intervention to regulate, or are best regulated at source for national protection. These risks are best addressed through a commissioning response at a national level. It is possible that sometimes the appropriate approach might be taken on a regional basis, with a number of local authorities regulating on behalf of the country

3.60 To illustrate better collaboration we would evidence the work being done on environmental health and public protection. An all-Wales response to Pennington is currently being devised, and the same is being done in relation to the Food Standards Agency review into the Food Law Review. There are already a number of all-Wales technical panels that exist that examine best practice: for example, developing guidance on food hygiene inspections, therefore ensuring consistency across Wales.

• The Wales Heads of Environmental Health and their Trading Standards counterparts meet regularly to discuss partnership and key areas of work. This group consists of all 22 authorities in Wales. Examples of the contribution include:

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• The Welsh authorities have now implemented the Food Hygiene Rating System (‘scores on the doors’) in Wales with an all-Wales implementation group to ensure consistency of implementation.

• There is also partnership working with key stakeholders such as the Health and Safety Executive in setting work each year for Wales.

• The partnership working between Trading Standards and the Department of Business and Innovation and Skills to monitor the safety of consumer products, removing many thousands of unsafe products from the supply chain; such work having been beyond the capacity of individual authorities.

• The work on tackling underage sales of alcohol and cigarettes assisted by the Welsh Assembly Government to formulate policy to improve health in Wales.

• The new laws on the sale of fireworks saw a partnership develop between trading standards, the University of Wales Cardiff and the explosives industry to create a training regime to ensure competency amongst local authority health and safety inspectors,. The course, the only one of its kind, has been attended by officers across England and Wales.

• The Welsh Air Quality Forum has been in place for many years and involves all local authorities, the Assembly Government, the Environment Agency Wales and an appointed scientific contractor tasked to collate all Wales air quality data and maintain the Forum’s website. The Forum was set up to ensure consistency in the application of Local Air Quality Management by local authorities, provide training and exchange knowledge and expertise.

• The WLGA/Environment Agency Wales/Assembly Government Land Contamination Working Group is another group involving local authorities and the Environment Agency Wales with a remit to provide training, ensure consistency and offer technical support to local authorities and the EAW in their administration of the land contamination legislation. A long standing partnership, it has been running for over ten years.

• There are numerous other Environmental Health groups covering food safety, health and safety, friar trading, weights and measures, housing and pollution control with similar remits to those mentioned above. These are made up of LA officers and colleagues from partner organisations

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that benefit from the combination of the relatively small number of Welsh authorities and their closeness geographically.

• The Trading Standards service, a non devolved function, has collaborated with the UK Government on a range of initiative to transform service delivery in Wales. The introduction of Consumer Direct ended the postcode lottery for consumer advice in Wales. The Wales Illegal Money Lending Unit has challenged robustly unlicensed money lending and continues to provide support to the financially excluded people in Wales. The Scambusters unit works with a range of law enforcement agencies to tackle cross border consumer crime, particularly where the victims of doorstep crime.

3.61 All the above demonstrate a considerable recognition and readiness within public protection services within Wales to work in a different way. This will be driven further by changing the statutory and regulatory frameworks as well as the reduced availability of resources. What is now necessary is a step change to increase the pace and the level of aspiration with an eye to maximising the pool of skills, experience and knowledge available across local authorities while creating a better more resilient service with its expertise available more widely.

We recommend that where regulatory risks are regional or national the regulatory service collaborate to deliver on a regional or national basis. This is the case in matters such as illegal money lending, trading standards, food standards and food hygiene, air quality and land contamination.

Specialist services

3.62 This review recognises the importance of changes meeting the proper needs to Welsh and English speaking citizens. It recognises the need for there to be the highest standard of such services. We are aware of the work ongoing in Ceredigion and Powys aiming to establish a common translation service. This is progressing well and showing business benefits. For those authorities where there is less readily available Welsh language expertise, the challenges of proving a good quality bilingual service can be significantly and costly. Therefore, creating a critical mass of skills and experience on which all can draw makes logistical sense. While the delivery of service would remain local, it is conceivable that the organisation, resourcing and management of a translation service at a national level should not pose major difficulties and could offer significant benefits.

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3.63 Public libraries in Wales are already offering inter-library loans. Museums, Archives and Libraries Wales (CyMAL) and the WLGA agreed the foundations for this a number of years ago. Citizens can make reservations or requests for any book within Wales for free and they can also borrow books from any library and return to any library across Wales. We believe this could be progressed further. Joint procurement of a public library management system, that phases in members as contracts come up for renewal, should be worked towards.

3.64 Library services could also benefit from the incorporation of library card and book ordering services at a higher level possibly nationally. More efficient stock management that utilises advancements in technology and new software could help this process, as could having shared reserve stock facilities. These could be effectively supported by having a national online reference library and following that, moving to a centralised strategic management team. The National Library for Wales is currently working on developing a national online reference library and we recommend that this is supported.

3.65 There are other areas for collaboration within library services, particularly regarding the sharing of specialist services or staff. This could take the form of a joint school library service or a mobile library service. In August 2010 the Future Library Programme was launched in England; and one aim of the programme was to create a wider support network of library sector professionals to test new ideas, share knowledge and to develop innovative solutions beyond their organisations or usual connections. A similar venture in Wales could be developed.

3.66 Likewise, within recreation and physical health, we suggest that an all Wales recreation card could have benefits if implemented. However, any plans to do so would need to bear in mind the potential imbalance in use between major cities (Cardiff in particular) and other areas and make allowances for this. There is also the potential for the outsourcing of some services, such as sports provision to social enterprise (with the advantage of potential business rate relief if contracted to a registered charity).

3.67 Indeed, there is a precedent for working with Sports Wales to achieve joint objectives on PE standards. The PE and School Sport Project has been in operation since 2000 and is managed by Sports Wales on behalf of the Welsh Assembly. The programme operates across schools in all 22 authorities and has enhanced day to day collaboration as a result. Efficiency gains so far have included more viable groups for training purposes, shared administration and delivery costs, as well as elimination of duplication. Projects like this can be expanded and other programmes can be developed where needed and where appropriate

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We recommend that local authorities collaborate in the delivery and procurement of Welsh translation services.

We recommend that there be collaboration in library services leading to the procurement of shared information systems which support shared procurement, shared borrowing and information services.

Emergency response 3.68 At times of crisis, whether a result of emerging circumstances or sudden

incidents, it is clearly essential that the public service response is rapid, focussed and effective. This is especially so given that emergencies rarely take place within a set of administrative boundaries and this is already compounded with the differences between NHS, police, fire and rescue service, coronial and local authority boundaries. In terms of planning and coordinating a response, the necessary involvement of so many organisations can affect the speed and efficacy of the public secretor response.

3.69 Local authorities are at the core of the response to most emergencies. As a Category 1 responder under the Civil Contingencies Act 2004, they are subject to the full set of civil protection duties. They are required to assess the risk of emergencies occurring and use this to inform planning; put in place emergency and business continuity plans; co-operate with other responders to enhance co-ordination and efficiency; put in place arrangements to warn and inform the public; share information with other responders and provide advice and assistance to business and the voluntary sector on business continuity.

3.70 Current arrangements for emergency planning are largely based on the existence of emergency planning units in each local authority; though some collaborative arrangements are in place in some areas. Responsibility for local arrangements, including funding for those arrangements rests with Chief Executives.

3.71 There is already some regionalisation of procedure through the four Local Resilience Fora (LRFs) which are based on Police force areas. The LRF is not a statutory body but it is a statutory process and the principal mechanism for multi-agency co-operation between Category 1 responders. In the event of emergencies occurring, the LRF provides the core of the Strategic Co-ordinating Groups which co-ordinate the response across agencies at the local level.

3.72 As the emergency planning responsibility is delivered largely by individual local authorities spread across Wales is unlikely that any single authority will have

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sufficient critical mass through which other departments can be engaged; valuable and scarce skills transferred more widely and best practice identified and shared effectively

3.73 We are aware that some emergency planners are beginning to cluster together in order to address some of these issues. The Review Group believes that this innovation is welcome and should be supported. But a much more fundamental review of Emergency Planning is required to move the local authority function to a regional level in the first instance, including funding arrangements and planning responsibilities with some aspects, such as training and exercising being delivered nationally. This is a matter of urgency and will need to be taken forward with the NHS, police, fire and the Assembly Government, learning lessons from the recent swine flu pandemic.

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4. Governance and Collaboration 4.1 It is widely agreed that public service delivery benefits from delivery

organisations working collaboratively to provide services across geographical and professional boundaries. In this way it is possible to make connections that otherwise might not have been made which potentially can have dramatic impacts on the effectiveness of service delivery.

4.2 However, there is at times an anxiety on the part of senior leaders when asked to apparently ‘concede’ responsibility for service areas when working collaboratively. Therefore, citizens, councillors, managers and employees will all need to be assured that the governance arrangements for any collaborative delivery are robust, effective and fit for purpose.

What is good governance?

4.3 The Independent Commission on Good Governance in Public Services in 2005 (the Langlands Commission) declared that good governance means:

• Focusing on the organisation’s purpose and an outcome for citizens and service users

• Performing effectively in clearly defined functions and roles • Demonstrating the values of good governance through behaviour • Taking informed, transparent decisions and managing risk • Developing the capacity and capability of the governing body to be

effective • Engaging stakeholders and making accountability real.

4.4 In acting according to these principles we should ensure that procedures are in

place to achieve the following in any collaborative arrangement:

• The purpose of the collaboration is clearly defined and agreed • A governing body is established to provide oversight and strategic

direction • Performance is specified and monitored • A funding mechanism is agreed which relates to the benefits gained by

each participating organisation • There is effective scrutiny of the collaborative arrangement and its

performance • There is a transparent mechanism for citizen redress in cases of service

shortcomings.

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4.5 The distinguishing feature and great strength of a local authority as a public service organisation is that its governance, public accountability and public engagement are exercised in substantial part through its elected members. For the governance of collaborative arrangements to be acceptable and effective the authority must provide at least as much control and accountability through elected members (admittedly involving members across a number of authorities) as other forms of service delivery by a local authority through its elected members.

4.6 In any collaborative arrangement there needs to be a host organisation which takes responsibility for operations and service delivery, the management of contracts and the employment of staff. Such a host organisation needs to have a legal identity. In outline it can take either of the following two forms. It can be one of the participating organisations acting as a lead or host or it can be a legal body constituted and owned by the participating organisations for the specific purpose of delivering the shared service. This may for instance be a company limited by guarantee. Employees would seek an assurance that their employment rights, terms and conditions in any such organisation would be at least equivalent to those within a local authority. In any given scenario, the following points would need to be considered and made clear.

i) Definition of purpose

Any collaborative arrangement should be based on a written agreement that sets out the purpose of the arrangement: what are the outputs that the arrangement will share between the participating organisations who will need to be assured from the outset that the shared service will be no more and no less than intended. The same agreement is likely to set out any procedures for entry and withdrawal from the shared service. Such an agreement will need to be ratified by the political executive of each participating local authority.

ii) Governing body

Where a collaborative arrangement results in an organisation taking responsibility for the exercise of functions of more than one local authority there is normally a shared governing body established to provide oversight and strategic direction for the shared service.

Where the provision of the shared service is to be undertaken by a host or lead local authority the governing body is usually a Joint Committee established under the powers provided sections 101/102 of the Local Government Act 1972 and sections 19/20 of the Local Government Act 2000; statutory provisions which still apply equally to both England and Wales. A Joint Committee will

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consist of elected members appointed by each of the participating local authorities.

Where the provision of the shared service is to be undertaken by a specially constituted organisation, then such an organisation will have a board of directors and each participating local authority would appoint members.

iii) Performance specification and monitoring

It is crucial in developing any shared service arrangement that the performance expected from the delivery organisation is clearly specified and monitored so that the public, councillors and service managers can have knowledge and assurance of what is to be delivered by the shared service organisation. Each participating local authority is likely to retain a capacity to engage with the shared service organisation, communicate local needs and assess performance reports provided by the shared service organisation.

iv) Funding mechanisms

In any collaboration which relies on shared resources there will need to be an agreed mechanism which allows for the shared funding of those resources. This may be done by apportioning the costs of the shared resource on a formula basis. The formula selected will vary according to the purpose of the collaboration. Some will use a population based formula; others may use a client based formula: number of employees, number of children in school, number of children in care. Some service delivery collaborations may have a unit costing system which charges the local authority according to the demands that it makes on the service. There can be mixed funding systems so that a defined core service is provided through a formula-based cost apportionment but ‘extra’ service can be acquired on a unit cost basis.

v) Political Scrutiny Arrangements

It is essential that the exercise of political scrutiny that elected members apply to ‘in-house’ service provision is equally applied to shared service provision. This may be arranged through the shared service organisation providing performance reports and being subject to questioning by separate scrutiny committees in each local authority. Alternatively a shared scrutiny committee might be established. Whereas the shared governing body is likely to consist of nominated executive members from each local authority, a shared scrutiny committee is likely to consist of nominated non-executive members.

vi) Citizen redress

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There is always a fear that when a service becomes shared the avenues of engagement and redress for citizens and councillors become obstructed, longer and more complex. This should not be the case if care is taken from the outset to put in place specified and transparent arrangements for engagement and redress. There would need to be well communicated contact officers and account managers within the shared service organisation or an equivalent officer on the ‘client-side’ in each local authority. Where local authorities are developing unified access systems for their services it will be necessary to ensure that shared services are integrated into such systems.

4.7 There is a view that the governance arrangements for collaborative arrangements are inevitably ineffective, over complex or lacking transparency. As in all aspects of public life there are instances of failure of governance. However there are many examples of sustained, effective governance of shared services which are little known because they simply work. Throughout the mainland of Europe collaborative networks of relatively small scale units of local government are the normal process of public administration and their governance arrangements are considered quite traditional and unremarkable.

New role for councillors

4.8 Implementing the changes we propose will have important implications for the roles of councillors. The reconfiguration of services will mean that a significant element of commissioning and/or delivery will take place beyond local authority boundaries. There will remain a very large element of local determination, but, if we were (wrongly) to see the role of elected councillors purely through that lens then these proposals might be seen as reducing the role (particularly of front line councillors). We wish to challenge that assumption.

4.9 People normally get involved in local politics to make a difference. Often this is triggered by some local agenda- a desire to see some improvement at a local school, involvement in some community regeneration work or worries about anti social behaviour in the area. People do not enter local politics with the aspiration to sit on committees; it is rather the way that we then engage councillors that they often view membership of committees as the way to progress the reasons why they first became involved.

4.10 But if we return to that original intention we should ask how best can we support and engage councillors to be that community voice or community champion. Once we recognise that people in need encounter a range of public services, delivered by a range of public agencies then it is clear that we should not prescribe the role of the councillor purely by those services that are presently delivered by the local authority.

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4.11 But if we are to ask frontline councillors to be “cabinet members for their ward” as described in the report by Local Government Leadership1, we must not purely make this an aspiration, we should expect some changes in the way local authorities support councillors in those roles. For too many authorities support for councillors tends to be seen through the perspective of council meetings and committee papers. Even the scrutiny process has often taken on the form of a traditional committee meeting. Work that councillors do in their wards is often seen as “political work”, from which the council should distance itself. We need to inverse that presumption. We also need to provide practical support for councillors to better undertake this role.

4.12 We recognise that for some councillors this may seem a very different role from what they have historically undertaken. We would stress that “some” does not mean all, and we see the role outlined as much more in line with the role historically undertaken. But change can always be difficult. We therefore recommend a three stage process:

i) Engagement with the major political parties (and leaders of independent groups on councils) about this switch of emphasis in advance of the process of selection of candidates for the next local elections;

ii) Coordinated work with member development officers to ensure that the induction process for new members is designed to best assist new members into these new roles;

iii) As the switch in significant levels of governance arrangements leads to more regional/collaborative governance the resource freed up by this process should be redirected towards better local support for members.

                                                            

1 http://www.localleadership.gov.uk/docs/CabinetMemberForYourWard.pdf

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5. Levers for change

5.1 The Social Justice and Local Government Minister has consistently put forward his ambition to see greater collaboration between authorities. He has also been clear that replicating every function 22 times is unnecessary, duplicative and wasteful but that wholesale local government reorganisation is not an option either. Collaboration is a significant part of the answer to bridging this gap.

5.2 It is clear that many of the aspirations raised in this review are not new and indeed, many of the changes are being driven forward in a number of areas. While some of the changes would require fairly significant effort and organisational reshaping, such as aligning pension funds or ICT systems, others are more achievable with little or no additional investment. Therefore, we ask how these changes can be adopted more widely and at the pace that is required. What is the mix of pulleys and levers that will create and sustain the momentum for change?

Creating a new momentum

5.3 There are a number of factors as to why projects of this nature have failed in the past, but the two biggest causes of failure fall into two categories: organisational and political. The organisational reasons include a lack of leadership and engagement at various levels within councils, a reluctance to recognise the benefits of change, and in some cases, the vested interests of those involved working against a successful outcome. The political reasons are that change is often difficult to accept, especially where any negative impact of that change affects constituencies or workers, or appears to cede sovereignty or control for services and activities to others.

5.4 Both factors can be countered by the principles for change we set out in Chapter 2 and the new role of councillors addressed in Chapter 4. However, to ensure that change will take place, there needs to be separate and compelling levers put in place. We believe that the transparency that would be an integral aspect of a Compact will be a key lever for change. The requirement for a public annual report that engages national and local leaders, with clear public accountability for the Assembly Government and the WLGA, will make the speed of change (or lack of it) evident for all to scrutinise.

5.5 Beyond that, we recognise the need for tools to be available to both WAG and Welsh local government. For the Assembly Government we believe that the long-term strategic lever is the need for local authorities to explicitly demonstrate progress against the national agenda to inform the local government settlement as we enter the next Spending Review period. In

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addition, the Assembly Government has a number of more tactical levers at its disposal.

5.6 For instance, the 2009 Local Government Measure provided Ministers with new powers in relation to collaboration. Through working together, authorities are able to identify and share best practice more easily; increase the proportion of resources directed at the frontline while reducing the overall burden of administration; and realise economies of scale. The Measure provides a vital enabling power to remove any statutory or other obstacles to councils collaborating to secure their duty towards continuous improvement or meet their improvement objectives.

5.7 In practice, this means that authorities are now easily able to provide financial assistance to support collaboration, exercise the functions of another authority, and provide staff, accommodation or other resources. Thus, there should be few if any legal barriers remaining to collaboration between local authorities.

5.8 The Measure also places a duty on authorities to consider whether any of its improvement objectives might be delivered better through collaboration. If it concludes that is the case, then the authority must do so. We are not convinced that authorities fully test the potential for collaboration as often as they should. Clearly many are engaged in developing collaborative projects but these appear to be developed and driven in part by personalities and opportunities.

5.9 There is much less evidence that a regular, systematic and strategic approach to identifying potential projects for collaboration is taken within and between authorities. This needs to be strengthened and evidenced much more effectively and we consider that this is a role for the WLGA Improvement Board, which should also lead and coordinate the strategic delivery aspects of collaboration.

5.10 Since the Beecham review recommended greater simplicity in public administration there has been transfer in of a significant number and value of hypothecated grants into the Revenue support grant including, Early Years (£17 million), Cymorth (£5.7 million), Special Education Needs (£5 million), and the Deprivation Grant (£22 million). We are not proposing any return to traditional hypothecation approaches. But in certain circumstances the targeting of resources could be used to drive particular types of service collaboration between authorities based either on rigorous spending controls focused on collaborative service provision; or incentives based on providing maximum flexibility within the local government settlement.

5.11 Ministers also have a wide ranging power to do anything they consider likely to assist an improvement authority to comply with the Measure, including exercising functions on behalf of the authority. They are also able to direct

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authorities to collaborate with others if that authority is failing, or likely to fail to comply with provision of Part 12 of the Measure. And, Section 30 allows Ministers to direct collaboration in cases where the authority is not failing. Therefore Ministers already have some significant statutory levers that can be brought to bear on authorities to encourage, and if necessary, direct the right sort of behaviours.

5.12 The Group considered these levers and concluded that the Minister should take a more proactive role in championing the change process and using these powers more regularly both to the support and encourage greater collaboration, but particularly to test and challenge those who do not appear to be achieving any progress based on the annual reporting detailed previously.

5.13 Finally, the Group notes that the Minister has published an amendment to the 2011 Local Government Measure that will provide an Order making to amalgamate local authorities. It is too early to consider what specific use might be made of those provisions – if indeed they became law – to support this agenda, however it is almost certain that there will be circumstances where broader, more fundamental action is required either to address failure in service provision which might also include circumstances where there is an unacceptably wide variation in service quality between authorities. Those circumstances will also where the local democratic arrangements are no longer working effectively or where the corporate capacity and capability of an authority have created substantial risks to sustainable and effective service delivery.

5.14 In addition to those levers, we believe that local government will need some support as well as challenge. We have already referred to some limited requirement for WAG to act as a banker for areas of service redesign which require some element of “invest to save”. We would not however want to create any presumption that this is always required.

We recommend that the Minister engages more actively with authorities in order to provide them with the political and leadership support required to maintain momentum. The Minister should also consider using existing powers to support and encourage change through collaboration in the delivery of services.

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Local government leadership is vital

5.15 We have already commentated extensively on the work being done by the WLGA in encouraging and supporting regional collaborations. We believe this should be seen as a foundation to build on. The Association is uniquely placed to provide clear sighted leadership to its members in these areas. We would therefore recommend that WLGA be tasked (and financially supported) to champion this agenda on behalf of local government. This could have two dimensions:

• Undertake more focused work around regional collaborations

• The WLGA, as a national organisation providing the basis for some of the proposed national elements of the new arrangements, for example the proposed new national translation service.

5.16 Each of these elements would need to be funded through centralised funding arrangements - which would give some transparency and accountability both back to the Assembly Government but also to the individual contributing authorities.

5.17 The WLGA is both a representative body and also an improvement organisation in receipt of funding from the Welsh Assembly Government. It works in the latter setting of being a “critical friend” to authorities encouraging, promoting and sustaining improvement within councils. In response to the new context highlighted in this report a different approach is emerging that WAG is seeking to accelerate.

5.18 The WLGA has already agreed to establish a subsidiary public company limited by guarantee which reports to the National Improvement Board would have the appropriate legal status to enter into contracts with other bodies., This could be a very significant and unique opportunity whereby the Association would provide a dynamic leadership role based on the principles in this report and ensuring a more robust and rigorous approach to developing collaborative delivery and outcomes. We believe this challenge can be met in three ways:

i) Establish clarity between the WLGA’s lobbying role and its service delivery and development role.

ii) The WLGA membership to raise expectations of its leadership role enabling it to have the freedom and space to develop its strategic policy role.

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iii) In the context of the Assembly Government’s tactical levers the WLGA would need to be closely consulted with formulating the circumstances in which they should be exercised. Clearly, if there was evidence of one authority refusing to participate in these developing arrangements then, in the context of the Compact and the Assembly measure, we think it would not be unreasonable for Ministers to regard such a general refusal as grounds to trigger some action.

We recommend that the WLGA clarify its various roles so as to allow a clearer separation between its service delivery and policy roles.

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6. Creating the Big Offer 6.1 The proposed timetable for the implementation of this review’s

recommendations is as follows:

• A Compact detailing the development of collaborative and national service delivery will be agreed by the Assembly Government and WLGA by July 2011. This Compact will set down a realistic but challenging timeline for dealing with our recommendation. It will also set out the potential responses that Ministers could take if local authorities do not meet the obligations they signed up for. It will be important the Assembly Government and WLGA agree and articulate what success will look like.

• Reporting and scrutiny of progress against the provisions of the Compact will be through the existing, statutory, Partnership Council arrangements. The WLGA will report back at least on the progress made by local government in line with the agreed timetable and we propose that the WLGA puts forward a detailed timetable for the new Minister in July 2011.

• The first annual report back from WLGA will be due in March 2012. In addition to the major collaborations proposed as part of the social services white paper and the education review, we propose that the Compact will provide for substantial progress on the following key recommendations:

⇒ We recommend that the mineral planning service and other specialist planning services are organised on a nation level.

⇒ We recommend that a national resource of planning expertise is

established so as to enable the public sector to make best use of its own expertise, avoiding expensive private sector input. This should include a standardisation of planning application standards and requirements at a national level, whilst maintaining the practical validation of applications at a local level.

⇒ We recommend that authorities should consolidate and build upon

existing arrangements for collaborative procurement based on shared approaches to contract documentation, standards and financial limits.

⇒ We recommend that where regulatory risks are regional or national then the regulatory service should collaborate to deliver on a regional or national basis and that this is the case in matters such as illegal money lending, food standards and food hygiene, air quality, land contamination.

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⇒ We recommend that emergency planning is organised on a regional basis and cross-sectoral basis involving local authorities, the NHS, the police and fire services.

6.2 The findings and recommendations in this report represent the views and aspirations of senior leaders in Welsh public service. We have tried to highlight current pieces of good practice across Wales and hope that the Compact will hasten the pace of change towards collaborative working. There needs to be increased capacity built within the system and stronger leadership to direct the capacity if these changes are to be met. We have found many reasons to believe that both of these issues will be addressed with the support of the WLGA, WAG and Solace Wales.

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Appendix One

Review Group Membership

Joe Simpson, Director of Politics and Partnerships (Chair)

Virlina Choquette, Programme development adviser

Local Government Leadership

Russell Roberts, Leader, RCT

Paul Griffiths, SE Regional Co-ordinator

WLGA

Jo Farrar, Chair, Chief Executive, Bridgend

Tracey Lee, Chief Executive, Newport

SOLACE

Trevor Jones

Private Sector

Paul O’Shea, Regional Secretary

Trades Unions

Jane Holownia

WAO (observer)

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Appendix Two

Reference Group Membership

Colin Everett, Chief Executive, Flintshire County Council Chief Executive

Geoff Petty, Director of Resources, Powys Society of Welsh Treasurers

Bruce McLernon, Director of Social Care and Housing. Carmarthenshire County Council

Association of Directors of Social Services

Giovanni Isingrini, Corporate Director, Merthyr Director of Services

Alan Sotheby, Chair Planning Officers Society for Wales

Robin Staines, Chair All Wales Chief Housing Officers Panel

Nicola Southall (observer) Assembly Government, Procurement Wales

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