Power struggles are a headache when sharing local tech services

But savings of 30 per cent or more can be expected

Shared services within IT are likely to become a priority for local authorities looking to save money following the Comprehensive Spending Review of the 20 October.

However, managing the power struggles between merging local authorities is likely to be one of the biggest headaches for managers of the process, according to Andy Heys, the interim manager of shared services at Cheshire County Council.

Heys, who was speaking at the Socitm 2010, Tomorrow’s Public Services Today conference in Brighton yesterday, said: “Everyone wants to be the supplier rather than the buyer of services; changing that mindset can be difficult, but it should be remembered that the financial benefits to sharing services are enormous.”

In April 2009, six councils were abolished in Cheshire, and two units, Cheshire West and Chester, and Chester East, were set up in its place. The county council now manages 30 services, including ICT, human resources and finance services, out of these two units. The council was able to reduce staff from 420 to 220. It also reduced spending by approximately 30 per cent.

The merged councils saw nine datacentre machine rooms reduced to two, and nine service desks reduced to just one – which saw productivity doubled, according to Heys.

However, he also said relationship breakdown between the merging councils was always a worry. “They are like boats that need to be scuttled – they must be prevented from going backwards. It takes time to establish a new governance structure and to see the benefits from savings, and until this is seen, they will want to go back to the old structure."

He added: “Actually managing the people side of change is the quickest part of the process, but integrating the IT systems, networks and other assets takes considerably longer."

Other councils that have made significant cost savings from merging services recently include Newham and Havering, estimated to be £1m over the past three years (in revenues), and Herefordshire, which has merged back-office services with local health authorities and expects to save £2.7m a year.

However, Heys argues that although there are early conversations in Cheshire around the sharing of other public sector services, such as the that of the police and the NHS, the network security requirements of these bodies differ so much that they would make the integration process extremely difficult.

“I can’t see that happening any time soon,” he said.