Headlines: July 11th, 2011

The Mayor of London’s plans to make savings by sharing services have met opposition from the different organisations within the capital. There is frustration that services can be shared without any adverse effect on performance or staff, but resistance from senior managers has put the savings target in jeopardy.

The Greater London Authority plans to save £300 million a year by 2013-14 through sharing back office services, such as IT. To date only £1.2 million of savings per year have been put in place.

The slow progress results from resistance from the capital’s police, fire and transport organisations and from the organisational structures currently in place. The shared services plans are not viewed as a priority and they are not seen as part of the manager’s ‘day job’. Consequently they are not prioritised and are not included in personal objectives.

Further delay in implementations results from the need for arrangements to be ratified by up to five different governance regimes. This produces inevitable delay because the process can only move at the progress of the slowest.

Experience has shown that ‘people-centric’ shared services can be effectively delivered at minimal cost and with little, if any, disruption to services. This has already been demonstrated with Legal, Procurement, Internal Audit and Democratic services. This means that savings in management costs can be achieved without changing the nature of the service delivery, the identity of the person delivering it, or even their workplace.

John Biggs, Chair of the Budget and Performance Committee said: “There is a clear opportunity to save significant sums of money by sharing more services across the GLA. However the challenge of getting everyone on board is making for very slow progress.“The Mayor’s Chief of Staff, like others before him, has today committed to taking the shared service agenda forward and so we will closely monitor progress to see if this programme actually starts to deliver real savings.”