The real prize for shared services could be the joining of central and local services, says Janice Morphet]The emerging appetite for local authorities to take on board the agenda for shared services is an interesting one. When initially raised by the efficiency review, and then included in Ian Watmore’s Transformational government (t-government) strategy last November, shared services formed one of the three, key planks of transformation, alongside customer focus and a more professionalised IT staff. At the time, the t-government strategy was aimed more clearly at central government departments, many of which have been struggling to find convincing efficiency savings. The Cabinet Office’s t-government implementation plan reinforced this difference with its separate, more discursive paper for local government, for which it holds no direct responsibility. Yet, it has been local government which has suddenly become more excited about the prospect of shared services, and for those who were engaged on the e-government agenda it appears to be the next big ‘project’. There is little agreement of what shared services might really mean, what is driving them, and of successful implementation. When seen from the perspective of the emergent Local Strategic Partnership agenda, as outlined by Phil Woolas on 14 June, shared services become one of the key components in the delivery a common public service, when ‘shared’ becomes ‘integrated’ in due course. While some of the arguments for shared services on efficiency grounds have been difficult to prove, the addition of a key policy driver could make a big difference to the business case. At the same time, shared services can be interpreted in a variety of ways. They are generally assumed to be about single, back-office system procurement and management, possibly delivered in an outsourced mode. However, there are more flexible and efficient approaches to consider. Establishing a public sector brokerage for utilising under-used capacity in one public sector organisation to provide a resource for another is clearly one way to go. Not only are many payroll and financial systems larger than required, other services based on staff with some capacity could be offered, including out-of-hours services, specialists in specific services as well as document management and CRM systems. Some local authorities are already providing services to PCTs, and there is no reason why this could not be done in reverse. Others have investigated providing a cashiers service for other organisations, or transferring all payments to the Post Office – both significant service considerations as the cost of cash collection rises as the number of payments reduce. Yet more are already delivering multi-agency services from their one-stop shops, reducing costs for all, while others are using the same delivery points and sharing overheads. Thus there are many examples of shared services at the local level. The bigger prizes could now emerge from the joining of central and local services. The Pension Service is already rolling out joint visiting teams with local authorities and increasingly, benefits calculators could pre-populate a myriad of entitlement forms. The Varney review, announced at the last Budget, is working to identify ways in which the government customer interface could be drawn together more. This work seems still to be concentrating on the back-office requirements rather than utilising existing local infrastructure – people and systems – which already exist. And for those who see shared services as the next big project… the challenge of implementing and maximising those systems which have been purchased in the last five years, re-engineering business and making the savings from these process changes could all be higher on the management agenda. A major revolution in reducing back-office costs and increasingly offering public sector integrated services to citizens could be on its way. n Janice Morphet is a director of rmjm Consulting and a former adviser to the former ODPM
