UK councils save nearly £500 million by sharing services including procurement

20 May 2015

Councils sharing services have saved nearly £500 million of taxpayers' money, new research has revealed, with procurement among the services that are increasingly likely to be shared.

The Local Government Association (LGA) said that since the first map was released in 2012 – showing which councils are engaging in the process – authorities have saved £462 million by sharing services. This is an increase of £105 million on last year’s total of £357.

According to the latest shared services map there has been a huge increase in savings made from councils sharing back office functions, such as legal, audit and HR. The total saved so far by such functions is £145 million.

LGA research also found significant increases in the sharing of adult services, procurement services, and capital assets. Sharing services and management with other public sector organisations has saved more than £15 million.

For example Hampshire County Council, Hampshire Police and Hampshire Fire and Rescue Services aim to save up to £4 million annually by sharing services such as procurement, finance, HR and printing. This scheme, called H3, is run equally governed by the three bodies and could be the first example of such cooperation between three different types of authorities in England, the LGA said.

The North East of England is seeing the fastest growth in shared service agreements, with 38 new arrangements in the past 12 months. In one example Durham County Council is working with North Durham Clinical Commissioning Group, Durham Dales, Easington and Sedgefield Clinical Commissioning Group and County Durham and Darlington Foundation Trust.

Councillor Peter Fleming, chair of the LGA's Improvement and Innovation Board, said: "As councils continue to find new ways to share services and provide the taxpayer with value for money, we are optimistic other areas of the public sector will be inspired by this work and follow the trail blazed by local government."

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