The London boroughs of Westminster, Hammersmith & Fulham and Kensington & Chelsea are to merge services. This goes beyond back office services and will include front line services. Merging a wide range of functions in this way could lead to the development of a new business model for councils across the country.

Each of the councils will retain its council leaders and local ward councilors. But the changes could include creating a single chief executive post with senior directors overseeing a range of functions. Initially the merger will include corporate services, with extensions to environmental and family services.

Earlier in the year Westminster and Hammersmith & Fulham announced the merger of their childrens’ services. This will include school admissions and transport.

Commenting in the latest merger, Steve Freer, chief executive of CIPFA, said: ‘This is a very bold move. Managed well, sharing services is a viable way to reduce unit costs and to roll out good practice. I expect that similar announcements may follow from other parts of the UK as local government and other public bodies prepare for life beyond the Spending Review.’

It is estimated that the merger will result in a saving of between £50-100m which will be achieved by cutting a large number of jobs.