Local authorities are now, more than ever, prepared to consider alternative service models for delivering essential services, writes Justin Galliford, CEO of Norse Group. Sponsored comment from Norse Group.

I was recently chatting with colleagues from the materials recycling industry about how the financial crisis is making local councils ‘think the unthinkable’. This was in the context of the upcoming changes to waste regulations, but the principle applies to all frontline services.

Justin Galliford, CEO of Norse Group

There are three prime options when it comes to providing services: in-house delivery through either a direct labour organisation or local authority trading company (LATC); traditional outsourcing to the private sector; or forming a joint venture partnership.

To a significant number of people – councillors, employees and indeed residents – taking control of frontline services out of the hands of the council is now becoming unthinkable.

This is in no small part down to high-profile bad experiences that a few councils have had with outsourcing contractors during recent years. These cases centred, in many instances, on poorly designed agreements that caused problems for both parties. However, the impact in all examples was felt by the end users of the services – the local residents.

Partnership working is the most effective way to address the financial and service delivery challenges

As a result the reluctance on the part of councils to consider alternatives to in-house delivery of essential services is perhaps understandable.

Yet there are many shining examples of local authorities successfully working with partners to deliver high-quality, cost-efficient and sustainable services.

As the UK’s leading LATC, Norse Group now operates more than 20 joint venture partnerships with councils across the country.

Our local authority partners retain a high degree of control through share ownership and the governance structure which comes from the joint venture arrangement. This gives them direct influence over the partnership’s strategy but does not inhibit the flexibility and commercial creativity that Norse, with its trading experience and knowhow, contributes.

Add to this the partnership model’s other key element – the ability to trade externally, raise revenue and share the profits – and it is clear that partnership working is far from ‘unthinkable’ but is instead the most effective way for local authorities to address the financial and service delivery challenges which lie ahead.