I have just come back from the Cabinet Resources Committee where they were dealing with, amongst other things, the outsourcing of the Development and Regulated Services functions. It covers services from Planning and Highways to Environmental Health. It didn't start well. "Written responses have been provided ask your supplementary questions". Yes well they forgot to supply the answers to me. I asked for a couple of minutes to read the replies and to his credit Cllr Thomas offered to adjourn public questions for a few minutes while I read the answers. "No" said Cllr Coleman "Read out the answers and then he has to ask his supplementary questions". Cllr Thomas did say that reading out the answers was rather tedious so I dived in. But no point really. What is clear is that the four councillors present simply aren't interested in any comment or debate. What I find most shocking is that they didn't
1. What assumptions are councillors using for the anticipated level of investment that the private sector will make in the proposed outsources services and why are these assumptions not detailed in the business case report?
Reply by the Chairman of the Cabinet Resources Committee
Councillors are not making any assumptions about the anticipated level of investment by a partner. We do expect that in order to make the cost savings investment will be made by any future partner, for example in technology and equipment. The exception to this is the cremators where significant investment will be required; the delivery of this investment will be considered separately.
During the competitive dialogue process, the council will be specifying the outcomes it wishes to achieve. It will choose its partner based upon the most efficient and effective solutions put forward to meet those outcomes.
How can you prepare a business case and ignore investment. What will be the cost of that investment and how is it likely to affect the price charged by the outsourcing company?
2. Are councillors concerned at the lack of benchmark data and evidence from other outsourced councils to support the assumptions set out on pages 41-43 of the report.
Reply by the Chairman of the Cabinet Resources Committee
Benchmarking data for the services in scope is limited, and in many cases the services themselves believe it to be unreliable. Where possible, CIPFA data and national indicators were used to give an indication of potential cost reduction and income increases. Where it was not possible to use benchmarking data, these assumptions were based upon what the services believed was possible, and market research.
So no evidence then!
3. Do councillors believe that the rather simplistic +or-10% for the sensitivity analysis is adequate for such a complex project?
Reply by the Chairman of the Cabinet Resources Committee
The +/- 10% confidence range is an indicator to demonstrate a logical range within which we would expect the new expenditure to operate. This range helps to determine whether a new provider could provide the same level of service for less cost, and specifically considers:
- The cumulative annual improvement to reach specified benchmarks, and;
- The effect on revised gross expenditure.
This is part of the financial model which underpins the Business Case, which at this stage is a description of the reasons for the project and the justification for undertaking it (based on the estimated costs of the project, the risks and the expected business benefits and savings). For DRS in particular, it provides the indicative evidence on which to progress the project to the next phase of activity, and further detailed modelling will occur one (sic) competitive dialogue is underway and we are clearer about what solutions the market has to offer. As a dynamic document, the Business Case will then be updated on the back of this data.
From my perspective simply tweaking the answers by +/- 10% is not a credible sensitivity when the assumptions are not supported by any evidence.
4. Do councillors believe that 4 key risks as set out on pages 52-53 of the report are an adequate assessment of the risk this project is likely to experience?
Reply by the Chairman of the Cabinet Resources Committee
The risks set out within the business case are the key risks only and not a full risk assessment of the project. A full risk register will be maintained by the One Barnet Programme Office and managed according to the London Borough of Barnet corporate risk management strategy.
No operational risks in the business case doesn't give me any confidence. Given Grant Thornton's previous comments back in December I think we have every right to be worried.
With questions out of the way the actual agenda item was dealt with in less than five minutes. Outsourcing approved.
So what is the answer. Well fellow residents of Barnet we all need to keep our fingers crossed and hope that this outsourcing project goes well because if it doesn't (and currently there is no evidence to suggest it will) we will all be paying for this mistake for years to come.
Standing up for common sense in New Barnet
Monday, 28 March 2011
Friday, 25 March 2011
The £270 million gamble - outsourcing at Barnet Council
Today the OJEU notice has been published, kicking off the outsourcing process for the Development & Regulatory Services. In the Notice it states that value of the contract will be between £270 million and £290 million excluding VAT over a 10 year contract with an option to extend for a further five years. That seems to be a huge sum to gamble based on a business case which is flimsy in the extreme. The undue haste of this project is amazing. Interested parties will be invited to a bidder briefing day on 5 April. This seems exceptionally short notice and might suggest that all the potentially bidders have already been put on alert. All this and the business case still hasn't been signed off by the Cabinet Resources Committee. I am utterly shocked at the way the whole process is being driven through with such huge sums of money involved. Every single resident of Barnet should be very very worried and asking their councillors some detailed questions about the whole basis for this high risk project.
Thursday, 24 March 2011
Council step back from cashless only parking policy
For all the talk of a cashless only pay by phone parking system being introduced, it appears that the council are having to bow to the pressure of so many people who say they do not have mobile phones. I read in the latest tranche of Delegated Powers Reports that Barnet are contracting with PayPoint to allow people to pay for their parking in local shops which have a PayPoint terminal. PayPoint also operate the telephone payment system so the two systems should work together. There will be a fee to pay by cash of 5% of the value of each transaction, with a minimum fee of 15p per transaction.
Having tried to park at 4 separate locations in the last week only to find that on each occasion the pay and display machines were not accepting cash, I think this is probably a welcome step not only for drivers but also for shopkeepers and the Council who must be losing significant revenue from people who simply drive away when they can't pay by cash.
Having tried to park at 4 separate locations in the last week only to find that on each occasion the pay and display machines were not accepting cash, I think this is probably a welcome step not only for drivers but also for shopkeepers and the Council who must be losing significant revenue from people who simply drive away when they can't pay by cash.
Tuesday, 22 March 2011
Filming and Recording of Council and Committee Meetings
Well well.On 30 March the General Functions Committee are considering whether they should allow bloggers and tweeters to film council meetings. They are also considering whether the Council should webcast meetings themselves. The report states that "The Council has been advised that the annual revenue cost to the authority would be approximately £14-16K per annum, including: installation; equipment hire; support services (including live monitoring, content hosting, streaming, project management, licence cost, equipment installation and hire); and 80 hours of content streaming". Sounds like good value to me. But wait. One of the options the committee is considering is "That the Committee indicate whether a report should be brought to a future meeting on the detailed financial implications of the various options for introducing a webcasting system to record Council and committee meetings". My concern is that this option gives them an opportunity to say they want webcasting and then kick it into the long grass while they "wait" for the report. I hope councillors listen to the public and make their mind up quickly.
Sunday, 20 March 2011
It's All a Question of Trust
Next Monday, the members of the Cabinet Resources Committee are going to rubber stamp yet another scheme to outsource services at Barnet Council. I have read the Business Case and basically it all boils down to a question of trust.
Do I trust a set of assumptions about the level of cost reductions and income increases which have absolutely not a single piece of supporting evidence other than trusting the people who are putting forward this scheme?
Do I trust the assumption they have made about the on costs that will be saved – that includes all that expensive IT investment that the council have been spending money on for the last 6 years.
Do I trust the assumption that they will have to retain 7.5% of the workforce to deal with all the elements that legally the council are not allowed to outsource – even though nobody seems to know?
Do I trust the assumptions on the sensitivity analysis that the best and worst case is only 10% away from the other assumptions – so for Planning that means that at worst they will save 18% and at best 22% or maybe even more?
Do I trust the assumption that there are only 4 key risks and that the mitigation steps will adequately address them?
Do I trust the private sector to deliver savings of as much as 20% whilst at the same time making investment in the services and leaving enough for a profit to satisfy their shareholders?
Do I trust the private sector to provide the level of transparency and governance standards that we currently expect (although don’t always receive) from a public sector?
Do I trust a process where the council enter an 18 month negotiating process without knowing what they are going to end up with at the end?
Well, for me the level of trust required here looks more like blind faith and I’m not that gullible. Frankly, it amazes me that any councillor can vote for something that requires this level of trust. It also amazes me that the ratepayers of Barnet trust councillors to make these decisions.
I implore every single ratepayer in Barnet to ask their councillor how they can take such a risky decision based almost exclusively on trust.
Do I trust a set of assumptions about the level of cost reductions and income increases which have absolutely not a single piece of supporting evidence other than trusting the people who are putting forward this scheme?
Do I trust the assumption they have made about the on costs that will be saved – that includes all that expensive IT investment that the council have been spending money on for the last 6 years.
Do I trust the assumption that they will have to retain 7.5% of the workforce to deal with all the elements that legally the council are not allowed to outsource – even though nobody seems to know?
Do I trust the assumptions on the sensitivity analysis that the best and worst case is only 10% away from the other assumptions – so for Planning that means that at worst they will save 18% and at best 22% or maybe even more?
Do I trust the assumption that there are only 4 key risks and that the mitigation steps will adequately address them?
Do I trust the private sector to deliver savings of as much as 20% whilst at the same time making investment in the services and leaving enough for a profit to satisfy their shareholders?
Do I trust the private sector to provide the level of transparency and governance standards that we currently expect (although don’t always receive) from a public sector?
Do I trust a process where the council enter an 18 month negotiating process without knowing what they are going to end up with at the end?
Well, for me the level of trust required here looks more like blind faith and I’m not that gullible. Frankly, it amazes me that any councillor can vote for something that requires this level of trust. It also amazes me that the ratepayers of Barnet trust councillors to make these decisions.
I implore every single ratepayer in Barnet to ask their councillor how they can take such a risky decision based almost exclusively on trust.
Thursday, 17 March 2011
Barnet Corporate Risk Register - a sea of red!
Looking through the papers for the forthcoming Barnet Council Audit Committee I was surprised when reading the Corporate Risk Register at just how many items were marked as high risk. Of the 13 items 11 have a high impact and 10 have both a high impact and either a medium or high probability of occurring as well. My attention was drawn to the new revenue and benefits system which will not be in place to collect taxes and administer benefits. It notes that the current supplier of Revenue & Benefits IT has been taken over by a third party and they are now "desupporting" the existing system and forcing all current users to source new systems. Dear oh dear. The problem may be resolved by now as the risk register was dated 31 January 2011 but it shows that when you depend on third parties they can let you down.
I am genuinely worried that the risks attached to the One Barnet Programme are being consistently underestimated and that hope is outweighing common sense. The One Barnet programme represents one of the largest risks to the borough yet there is virtually no transparency on the One Barnet risk register. Every single citizen of the borough will suffer the consequences of this programme if it goes wrong - surely we have the right to at least look at the One Barnet risk register and see what fate awaits us.
Tuesday, 15 March 2011
Outsourcing - short termist approach!
The latest Delegated Powers Report is one which seeks authorisation to purchase new servers for the regulatory services department (planning, development, environmental health). Now we aren’t talking about that much money - £27,500 certainly when compared to the dreaded SAP system which has cost millions. However what is interesting is that they have chosen the cheaper option to get them through the next 18 months. There is an option which will deliver a complete solution but the report notes that this option would only be chosen if the systems is to “remain council responsibility in to the foreseeable future” and that “bearing in mind the One Barnet programme due for Regulatory Services in 2012” they have gone for the cheaper option. Now I have dealt with outsourcing companies for many years and they are prepared to invest - often that is the key driver for outsourcing. However their own Internal Rate of Return (IRR) required to justify investment is often high - some companies I have dealt with look for an IRR of 20%+. They have to recover that investment somehow and it ends up in the charges. Basically you end up using them as an expensive bank and in most cases that just doesn't make sense. I know money is tight now but like a lot of those PFI schemes, trading investment today for much higher future payments just doesn't make economic sense.
What really worries me is that the council are forcing through this outsourcing agenda even though I am not sure they have fully thought it through. The evidence is at best flimsy and it could end up costing us millions to sort out in the future.
What really worries me is that the council are forcing through this outsourcing agenda even though I am not sure they have fully thought it through. The evidence is at best flimsy and it could end up costing us millions to sort out in the future.
Friday, 11 March 2011
Barnet we have a problem!
In today’s batch of delegated powers reports is the creation of a new post – Corporate Complaints Officer (£33,510 – £36,306)
The report states that:
The creation of this post seeks to mitigate the following issues with the corporate
complaints process in the Council:
• Lack of a corporate owner through the decentralised structure
• Lack of corporate understanding of complaints
• Inconsistency in reporting and practice
• Lost opportunities for service improvements
Although it is laudable that the council are at last addressing these serious shortcomings I can’t help but feel they are coming at the this problem from the wrong direction. In the Purpose of the Job section of the job description, 6 of the 8 bullet points refer to how the complaints process can be monitored, recorded or managed in a better manner. Only two points relate to how the person can contribute to service improvements. In a commercial business I doubt they would beef up the customer complaints department in this way – they would put much greater emphasis on tackling the areas that are giving rise to complaints. The best solution would be an organisation that has no need for a complaints officer. Given that the council are in the process of making 800 people redundant and cutting services perhaps they feel they are likely to get a lot more complaints and are responding accordingly. All very worrying!
The report states that:
The creation of this post seeks to mitigate the following issues with the corporate
complaints process in the Council:
• Lack of a corporate owner through the decentralised structure
• Lack of corporate understanding of complaints
• Inconsistency in reporting and practice
• Lost opportunities for service improvements
Although it is laudable that the council are at last addressing these serious shortcomings I can’t help but feel they are coming at the this problem from the wrong direction. In the Purpose of the Job section of the job description, 6 of the 8 bullet points refer to how the complaints process can be monitored, recorded or managed in a better manner. Only two points relate to how the person can contribute to service improvements. In a commercial business I doubt they would beef up the customer complaints department in this way – they would put much greater emphasis on tackling the areas that are giving rise to complaints. The best solution would be an organisation that has no need for a complaints officer. Given that the council are in the process of making 800 people redundant and cutting services perhaps they feel they are likely to get a lot more complaints and are responding accordingly. All very worrying!
Thursday, 10 March 2011
Outsourcing Part 2 - Examples from other Local Authorities
As a reasonable person I thought I should investigate what the experience of other local authorities have been with outsourced contracts. A simple trawl through the internet reveals that there are quite a few negative comments and not many positive ones – other than press releases put out by the outsourcing companies.
Examples of outsourcing problems at Local Authorities that I came across include:
Essex - BT:
Essex County Council is facing a claim for ‘substantial’ damages after terminating an IT contract with BT worth at least £250m. Essex signed the ten-year contract with BT’s Syntegra subsidiary in 2002, with 130 council staff and 200 third-party contracts transferred to the company.
The strategic partnership contract, valued at £25m a year when it was signed, extended well beyond basic IT services. A BT spokesman said the council had ‘unlawfully terminated our contract’. He added: ‘Having discussed the position with our lawyers, we can confirm we will be seeking substantial damages.’ A council spokeswoman countered that the deal had been terminated because the council was ‘determined to deliver better services at a better price for Essex taxpayers’. Source: http://www.publicfinance.co.uk/news/2009/02/essex-faces-damages-claim-after-terminating-bt-contract/
Liverpool - BT:
THE chairman of Liverpool’s finance select committee demanded to know why a damning report revealing the city council is being overcharged £10m a year by BT was kept secret. Cllr Paul Clein said it was disappointing to have to read the details of the report in the Liverpool ECHO as his committee and a special panel set up to scrutinise the contract was not aware it had even been written. The Liverpool ECHO revealed how the secret report into the controversial Liverpool Direct Limited (LDL) concluded that £23m-a-year could be saved if the contract were terminated. The bleak assessment of the £70m-a-year LDL contract also stated BT has been “excessively marking up” the cost of equipment not specified in the original deal, which was signed in 2001. The council claims the report, written in June, is a draft and has not yet been fully evaluated.
Source: http://www.liverpoolecho.co.uk/liverpool-news/local-news/2010/09/29/finance-select-committee-chairman-demands-answers-over-secret-liverpool-direct-limited-report-100252-27361424/#ixzz1GDAqokHE
Thurrock - Vertex:
Thurrock Council has been slammed for charging residents £71,200 in illegal fees.
An investigation by the Local Government Ombudsman has found that Vertex, the private company hired by the authority for council tax recovery, charged 178 residents a £400 fee which was “illegal and could not be enforced”, in relation to council tax arrears. Source: http://www.thurrockgazette.co.uk/news/5000200.Council_slammed_for_giving_178_residents_illegal_fine/
SouthWestOne (SWO) – IBM:
An investigation by the Audit Commission stated in its conclusions:
“The first three years of the contract have been a difficult time for both the Council and SWO, largely owing to the challenge of implementing SAP across the County Council and its partners. Both SWO and the Council have clearly spent significant time and money to make a success of the arrangement but so far the benefits have not fully met those originally envisaged. Performance management arrangements of the contract have improved over the last year but more work is required.
Potential savings of £45.5 million (£22 million implemented and £23.5 million awaiting implementation) have been identified and agreed. The Council is in the process of delivering these savings, with a further £40 million identified by SWO but not yet agreed by the Council for delivery (the ‘pipeline’). However, actual savings are below those originally forecast and currently stand at £3.3 million 'cashed', part of the £22 million of benefits implemented – savings to this value will flow as spend is incurred in future years. To realise the original savings profile will require a significant increase in the delivery of savings but this may be curtailed given the reductions in local government spend nationally.
Source:http://www1.somerset.gov.uk/council/board9/2010%20December%209%20Item%2015%20Southwest%20One%20Benefits%20Rationalisation%20and%20Performance%20Monitoring%20Appendix.pdf
The contract is now in the process of being renegotiated. See what the local MP has to say about the contract. http://www.liddellgrainger.org.uk/somersetwest/SOUTHWESTONE.html
Now I’m not saying that all outsourcing contracts are a problem but surely these sorts of reports should be getting Councillors to at least ask some probing questions about how this process is being handled, what risk assessments have been undertaken and what are the potential downsides. So far the lack of challenge has been terrifying. My experience at the One Barnet Scrutiny Panel suggests that there is no meaningful scrutiny taking place at all. We have only been told of the huge savings that will be made by One Barnet. What we need is a balanced and open debate on whether outsourcing is the right answer in Barnet but sadly I fear that will never materialise.
Examples of outsourcing problems at Local Authorities that I came across include:
Essex - BT:
Essex County Council is facing a claim for ‘substantial’ damages after terminating an IT contract with BT worth at least £250m. Essex signed the ten-year contract with BT’s Syntegra subsidiary in 2002, with 130 council staff and 200 third-party contracts transferred to the company.
The strategic partnership contract, valued at £25m a year when it was signed, extended well beyond basic IT services. A BT spokesman said the council had ‘unlawfully terminated our contract’. He added: ‘Having discussed the position with our lawyers, we can confirm we will be seeking substantial damages.’ A council spokeswoman countered that the deal had been terminated because the council was ‘determined to deliver better services at a better price for Essex taxpayers’. Source: http://www.publicfinance.co.uk/news/2009/02/essex-faces-damages-claim-after-terminating-bt-contract/
Liverpool - BT:
THE chairman of Liverpool’s finance select committee demanded to know why a damning report revealing the city council is being overcharged £10m a year by BT was kept secret. Cllr Paul Clein said it was disappointing to have to read the details of the report in the Liverpool ECHO as his committee and a special panel set up to scrutinise the contract was not aware it had even been written. The Liverpool ECHO revealed how the secret report into the controversial Liverpool Direct Limited (LDL) concluded that £23m-a-year could be saved if the contract were terminated. The bleak assessment of the £70m-a-year LDL contract also stated BT has been “excessively marking up” the cost of equipment not specified in the original deal, which was signed in 2001. The council claims the report, written in June, is a draft and has not yet been fully evaluated.
Source: http://www.liverpoolecho.co.uk/liverpool-news/local-news/2010/09/29/finance-select-committee-chairman-demands-answers-over-secret-liverpool-direct-limited-report-100252-27361424/#ixzz1GDAqokHE
Thurrock - Vertex:
Thurrock Council has been slammed for charging residents £71,200 in illegal fees.
An investigation by the Local Government Ombudsman has found that Vertex, the private company hired by the authority for council tax recovery, charged 178 residents a £400 fee which was “illegal and could not be enforced”, in relation to council tax arrears. Source: http://www.thurrockgazette.co.uk/news/5000200.Council_slammed_for_giving_178_residents_illegal_fine/
SouthWestOne (SWO) – IBM:
An investigation by the Audit Commission stated in its conclusions:
“The first three years of the contract have been a difficult time for both the Council and SWO, largely owing to the challenge of implementing SAP across the County Council and its partners. Both SWO and the Council have clearly spent significant time and money to make a success of the arrangement but so far the benefits have not fully met those originally envisaged. Performance management arrangements of the contract have improved over the last year but more work is required.
Potential savings of £45.5 million (£22 million implemented and £23.5 million awaiting implementation) have been identified and agreed. The Council is in the process of delivering these savings, with a further £40 million identified by SWO but not yet agreed by the Council for delivery (the ‘pipeline’). However, actual savings are below those originally forecast and currently stand at £3.3 million 'cashed', part of the £22 million of benefits implemented – savings to this value will flow as spend is incurred in future years. To realise the original savings profile will require a significant increase in the delivery of savings but this may be curtailed given the reductions in local government spend nationally.
Source:http://www1.somerset.gov.uk/council/board9/2010%20December%209%20Item%2015%20Southwest%20One%20Benefits%20Rationalisation%20and%20Performance%20Monitoring%20Appendix.pdf
The contract is now in the process of being renegotiated. See what the local MP has to say about the contract. http://www.liddellgrainger.org.uk/somersetwest/SOUTHWESTONE.html
Now I’m not saying that all outsourcing contracts are a problem but surely these sorts of reports should be getting Councillors to at least ask some probing questions about how this process is being handled, what risk assessments have been undertaken and what are the potential downsides. So far the lack of challenge has been terrifying. My experience at the One Barnet Scrutiny Panel suggests that there is no meaningful scrutiny taking place at all. We have only been told of the huge savings that will be made by One Barnet. What we need is a balanced and open debate on whether outsourcing is the right answer in Barnet but sadly I fear that will never materialise.
Wednesday, 9 March 2011
Outsourcing Planning - Have they thought it through?
As part of the preparation of the Localism Bill there was a submission to the parliamentary committee on the outsourcing of the planning function in Local Authorities. As well as setting out advice, there was an example of best practice from New Zealand. I have set out below a small excerpt from that best practice guide.
Determine what the council wants to achieve by outsourcing. Before starting, clearly identify:
• Why the council is considering outsourcing?
• What services does the council need to outsource, and to what extent?
Knowing the 'why' and 'what' will provide a clear basis for selecting a contractor. Consider these issues in a strategic assessment:
• Does the council still want to be outsourcing in 12 months time?
• What are the future workload predictions? Consider historic trends, economic outlooks, and projected growth. Is it necessary to outsource the entire consent (planning application) service or would partial outsourcing be sufficient to manage peaks in resource consents? Consent volumes are also related to the plan provisions. Consider whether the plan provisions are likely to change in the near future (through either plan changes or the review process).
• What outsourcing options are there? Will outsourcing to one or more local suppliers create unworkable conflicts of interest, or remove necessary consultant options for the community?
• Does the council need particular technical skills or an increase in general resources? Would it be better to increase in-house resources, rather than outsourcing? Will 'in-house' skills be lost or can 'in-house' skills be enhanced?
• Will the use of an external contractor create tension within the planning department, or with other departments of the council? What type of work does the existing staff want to retain? Staff may wish to retain the more challenging and complex applications to enhance their professional development and maintain job satisfaction.
• What are the views and expectations of the council's managers and politicians?
• Does the council need to consult internally and/or externally? Does the community want the council to retain services in-house?
• What management structure and systems will be implemented to ensure a smooth transition of processing consents between council and contractors?
If we were seeing evidence of a strategic assessment and a carefully considered approach I might feel a little more confident in the process. I haven’t seen any evidence yet but it may be hidden away in those One Barnet Board minutes that we are not allowed to read. If this strategic assessment does exist then the council should be sharing it with the key stakeholder, residents and staff. However, I have a horrible feeling that the outsourcing exercise is purely driven by political dogma and many of these questions simply have not been asked let alone addressed. If that is the case then I for one will not be surprised when it all goes wrong but I will make sure to remind councillors who is to blame - them
Determine what the council wants to achieve by outsourcing. Before starting, clearly identify:
• Why the council is considering outsourcing?
• What services does the council need to outsource, and to what extent?
Knowing the 'why' and 'what' will provide a clear basis for selecting a contractor. Consider these issues in a strategic assessment:
• Does the council still want to be outsourcing in 12 months time?
• What are the future workload predictions? Consider historic trends, economic outlooks, and projected growth. Is it necessary to outsource the entire consent (planning application) service or would partial outsourcing be sufficient to manage peaks in resource consents? Consent volumes are also related to the plan provisions. Consider whether the plan provisions are likely to change in the near future (through either plan changes or the review process).
• What outsourcing options are there? Will outsourcing to one or more local suppliers create unworkable conflicts of interest, or remove necessary consultant options for the community?
• Does the council need particular technical skills or an increase in general resources? Would it be better to increase in-house resources, rather than outsourcing? Will 'in-house' skills be lost or can 'in-house' skills be enhanced?
• Will the use of an external contractor create tension within the planning department, or with other departments of the council? What type of work does the existing staff want to retain? Staff may wish to retain the more challenging and complex applications to enhance their professional development and maintain job satisfaction.
• What are the views and expectations of the council's managers and politicians?
• Does the council need to consult internally and/or externally? Does the community want the council to retain services in-house?
• What management structure and systems will be implemented to ensure a smooth transition of processing consents between council and contractors?
If we were seeing evidence of a strategic assessment and a carefully considered approach I might feel a little more confident in the process. I haven’t seen any evidence yet but it may be hidden away in those One Barnet Board minutes that we are not allowed to read. If this strategic assessment does exist then the council should be sharing it with the key stakeholder, residents and staff. However, I have a horrible feeling that the outsourcing exercise is purely driven by political dogma and many of these questions simply have not been asked let alone addressed. If that is the case then I for one will not be surprised when it all goes wrong but I will make sure to remind councillors who is to blame - them
Wednesday, 2 March 2011
One Barnet Outsourcing - sidestepping the questions
Today I received responses to my questions submitted to tonight’s Cabinet Resources Committee. I think the answers are fascinating more by what they don’t say than what they do say and the way they try and side step the answers. I decided that after last night’s fiasco I would not appear in person to challenge the responses but it is clear to me and anyone who looks in details at the responses that there are some pretty big hole in the thinking behind the latest outsourcing scheme.
Q1. Are the Committee confident that the decision to press ahead with the preferred option is sufficiently robust to withstand any potential legal challenge given that there is no supporting evidence for any option other than the performance of the current in house team in any of the evaluation matrices and there is no risk assessment of any option?
Reply by the Chairman of the Cabinet Resources Committee:
Appendix B of the Options Appraisal outlines the scores attributed to each theme for each potential delivery option and the rationale behind these scores. These scores were developed through discussions between the project manager, One Barnet Implementation Partner and senior officers within the Council. Whilst it can be acknowledged that these scores are subjective, the rationale behind them, particularly comparative scores for the same theme across different delivery options is based on an in-depth understanding of the different delivery options. Appendix C, D and E of the Options Appraisal discuss the Strengths, Weaknesses and Impact on Staff of each potential delivery option. While not formally a risk register, this analysis is assessing and recognising the risks inherent within each of the potential delivery options, which must be taken into account through any decision-making process and future plans for the delivery of the option must be developed in order to mitigate these risks. In no cases are these risks perceived to be insurmountable and without potential mitigating action. The weightings for each service were developed by the project manager in conjunction with the service lead(s) (senior officer(s) within each service) and implementation partner. This process involved evaluating and understanding the available data, as presented in the options appraisal, about the cost, performance and change and improvement requirements for each service. Weightings were then developed (and iteratively improved through discussions with project board) based on what was required for each service given the conclusions drawn about the data in order for the desired outcome to be achieved for each service. Consequently for a service that is already working well (i.e. is high performing and low cost) with little change needed, the themes given the highest weighting were performance and cost, as in order to achieve the One Barnet objectives of high-performing and low-cost support services a delivery option that can best deliver against the performance and cost themes would be the preferred option (even if the services are already high-performing and low-cost, as there is still room for improvement to make them higher-performing and lower cost). Conversely, a service requiring significant transformation, again understanding that the One Barnet objective is to have high-performing and low-cost services, had a higher weighting on other themes (such as transformation and pace) as these are important to deliver the required transformation to deliver the desired outcomes for that service.
Yes but it doesn’t answer the question about the risk of legal challenge and it concedes that the scores were subjective and that there is no risk assessment of the options just strengths and weakness. It reminds me of what Grant Thornton said last year, “there is evidence to suggest that risk management is not widely understood within the Council."
Q2. Are the Committee concerned that the Finance and Revenue & Benefits functions will be included in the outsourcing scheme even though there is no evidence to support this strategy other than the appetite of the private sector?
Reply by the Chairman of the Cabinet Resources Committee:
It is entirely appropriate that the Finance and Revenues & Benefits functions are included in the cluster of services to be outsourced, as this is the option that it is believed will best deliver the desired outcomes for these services. It is true to say that they are already relatively high performing and relatively low cost, however there is potential for improvement to make these services higher performing and lower cost than they already are, and the options appraisal recommends that outsourcing these services is the option that will best enable this desired outcome to be delivered. It is important to understand that the outsourcing option is not an option that should only be recommended when services are high-cost and low performing, in fact experience from other organisations show that services should only be outsourced when their performance is at least adequate, to prevent the private sector from realising significant benefits that will not be passed back to the Council.
So when a service is running well and at low cost you give it to an external company who are in business to make a profit and take the risk that they will c**k it up. Doesn’t make sense to me!
Q3. Can the Committee confirm that they are not prepared to consider an in house option under any circumstances?
Reply by the Chairman of the Cabinet Resources Committee:
The Options Appraisal has considered the in-house option, and in fact for Legal Services has recommended that in-house delivery is the preferred option. In-house options will be considered at options appraisal throughout the One Barnet programme, and where through options appraisal the in-house option is the recommended option plans will be developed to implement this option.
No. Cllr Rams stated quite clearly at the One Barnet Scrutiny Panel in response to a question from Cllr Rawlings that they would not be considering an in house option. The reason why figures for an in-house option are included is because they represent the base case against which the other options are judged. The only reason why Legal is staying in house is “because the private sector do not have an appetite to take it on”. For that read they can’t make money at it.
Q4. Are the Committee concerned that, as there is no possibility of an in house option, key members of staff will start leaving the Council in the intervening 18 months that it will take to negotiate a contract with the outsourcing company? How has this been addressed within the option appraisal risk assessment?
Reply by the Chairman of the Cabinet Resources Committee:
It is important during a period of change to ensure communication and engagement of employees is well planned and implemented. There will always be a risk to an organisation at these times and risk management is essential. There is an entry on the One Barnet Programme risk register which relates to the potential exit of existing employees due to future uncertainty, with actions against this for managers to carry out. As part of the communication and engagement strategy, staff groups and briefings are taking place and they offer channels for employee feedback. Line managers are required to manage their direct reports and understand where there may be a risk and support individuals through the change. Where outsourcing is the chosen option on a project there will potentially be development opportunities from working for a different and possibly larger organisation. There are a number of employees who recognise and welcome this prospect.
Nice side step of the question. I asked if it was considered in the option appraisal risk assessment. The answer should have been no because there was no option appraisal risk assessment. There cannot have been a fair assessment of the options because if this does represent a risk for an outsourced option, the score would be much lower for an in-house option making in-house look more attractive. I wonder who are the employees that welcome the prospect of outsourcing?
Q5. Are the Committee concerned that this outsourcing report appears to be critical of the way the Council has been run as evidenced at Appendix F paragraphs F1.5, F2.5, F3.5, F4.5, F5.5, F6.5 and F7.5? Who is to blame, officers or councillors and who should the residents hold accountable?
Reply by the Chairman of the Cabinet Resources Committee:
The Options Appraisal gives an honest and open appraisal of the current performance of each service in scope. Any organisation at any point would expect to have areas of the organisation in need of change and improvement, and this is more likely to be the case when, as in the case of the Council currently, the organisation is undergoing significant change and facing significant pressures. The report is not being critical of the way the Council has been run, it is quite correctly identifying weaknesses and areas for improvement (which if it did not would invalidate the recommendations in the options appraisal).
OK so the current regime have been running the council for nine years. Who is responsible for the “weaknesses and areas for improvement” and why weren’t they improved years ago. No one to blame. No one to hold accountable.
Overall a sorry set of responses which illustrate what a mess they are in.
Q1. Are the Committee confident that the decision to press ahead with the preferred option is sufficiently robust to withstand any potential legal challenge given that there is no supporting evidence for any option other than the performance of the current in house team in any of the evaluation matrices and there is no risk assessment of any option?
Reply by the Chairman of the Cabinet Resources Committee:
Appendix B of the Options Appraisal outlines the scores attributed to each theme for each potential delivery option and the rationale behind these scores. These scores were developed through discussions between the project manager, One Barnet Implementation Partner and senior officers within the Council. Whilst it can be acknowledged that these scores are subjective, the rationale behind them, particularly comparative scores for the same theme across different delivery options is based on an in-depth understanding of the different delivery options. Appendix C, D and E of the Options Appraisal discuss the Strengths, Weaknesses and Impact on Staff of each potential delivery option. While not formally a risk register, this analysis is assessing and recognising the risks inherent within each of the potential delivery options, which must be taken into account through any decision-making process and future plans for the delivery of the option must be developed in order to mitigate these risks. In no cases are these risks perceived to be insurmountable and without potential mitigating action. The weightings for each service were developed by the project manager in conjunction with the service lead(s) (senior officer(s) within each service) and implementation partner. This process involved evaluating and understanding the available data, as presented in the options appraisal, about the cost, performance and change and improvement requirements for each service. Weightings were then developed (and iteratively improved through discussions with project board) based on what was required for each service given the conclusions drawn about the data in order for the desired outcome to be achieved for each service. Consequently for a service that is already working well (i.e. is high performing and low cost) with little change needed, the themes given the highest weighting were performance and cost, as in order to achieve the One Barnet objectives of high-performing and low-cost support services a delivery option that can best deliver against the performance and cost themes would be the preferred option (even if the services are already high-performing and low-cost, as there is still room for improvement to make them higher-performing and lower cost). Conversely, a service requiring significant transformation, again understanding that the One Barnet objective is to have high-performing and low-cost services, had a higher weighting on other themes (such as transformation and pace) as these are important to deliver the required transformation to deliver the desired outcomes for that service.
Yes but it doesn’t answer the question about the risk of legal challenge and it concedes that the scores were subjective and that there is no risk assessment of the options just strengths and weakness. It reminds me of what Grant Thornton said last year, “there is evidence to suggest that risk management is not widely understood within the Council."
Q2. Are the Committee concerned that the Finance and Revenue & Benefits functions will be included in the outsourcing scheme even though there is no evidence to support this strategy other than the appetite of the private sector?
Reply by the Chairman of the Cabinet Resources Committee:
It is entirely appropriate that the Finance and Revenues & Benefits functions are included in the cluster of services to be outsourced, as this is the option that it is believed will best deliver the desired outcomes for these services. It is true to say that they are already relatively high performing and relatively low cost, however there is potential for improvement to make these services higher performing and lower cost than they already are, and the options appraisal recommends that outsourcing these services is the option that will best enable this desired outcome to be delivered. It is important to understand that the outsourcing option is not an option that should only be recommended when services are high-cost and low performing, in fact experience from other organisations show that services should only be outsourced when their performance is at least adequate, to prevent the private sector from realising significant benefits that will not be passed back to the Council.
So when a service is running well and at low cost you give it to an external company who are in business to make a profit and take the risk that they will c**k it up. Doesn’t make sense to me!
Q3. Can the Committee confirm that they are not prepared to consider an in house option under any circumstances?
Reply by the Chairman of the Cabinet Resources Committee:
The Options Appraisal has considered the in-house option, and in fact for Legal Services has recommended that in-house delivery is the preferred option. In-house options will be considered at options appraisal throughout the One Barnet programme, and where through options appraisal the in-house option is the recommended option plans will be developed to implement this option.
No. Cllr Rams stated quite clearly at the One Barnet Scrutiny Panel in response to a question from Cllr Rawlings that they would not be considering an in house option. The reason why figures for an in-house option are included is because they represent the base case against which the other options are judged. The only reason why Legal is staying in house is “because the private sector do not have an appetite to take it on”. For that read they can’t make money at it.
Q4. Are the Committee concerned that, as there is no possibility of an in house option, key members of staff will start leaving the Council in the intervening 18 months that it will take to negotiate a contract with the outsourcing company? How has this been addressed within the option appraisal risk assessment?
Reply by the Chairman of the Cabinet Resources Committee:
It is important during a period of change to ensure communication and engagement of employees is well planned and implemented. There will always be a risk to an organisation at these times and risk management is essential. There is an entry on the One Barnet Programme risk register which relates to the potential exit of existing employees due to future uncertainty, with actions against this for managers to carry out. As part of the communication and engagement strategy, staff groups and briefings are taking place and they offer channels for employee feedback. Line managers are required to manage their direct reports and understand where there may be a risk and support individuals through the change. Where outsourcing is the chosen option on a project there will potentially be development opportunities from working for a different and possibly larger organisation. There are a number of employees who recognise and welcome this prospect.
Nice side step of the question. I asked if it was considered in the option appraisal risk assessment. The answer should have been no because there was no option appraisal risk assessment. There cannot have been a fair assessment of the options because if this does represent a risk for an outsourced option, the score would be much lower for an in-house option making in-house look more attractive. I wonder who are the employees that welcome the prospect of outsourcing?
Q5. Are the Committee concerned that this outsourcing report appears to be critical of the way the Council has been run as evidenced at Appendix F paragraphs F1.5, F2.5, F3.5, F4.5, F5.5, F6.5 and F7.5? Who is to blame, officers or councillors and who should the residents hold accountable?
Reply by the Chairman of the Cabinet Resources Committee:
The Options Appraisal gives an honest and open appraisal of the current performance of each service in scope. Any organisation at any point would expect to have areas of the organisation in need of change and improvement, and this is more likely to be the case when, as in the case of the Council currently, the organisation is undergoing significant change and facing significant pressures. The report is not being critical of the way the Council has been run, it is quite correctly identifying weaknesses and areas for improvement (which if it did not would invalidate the recommendations in the options appraisal).
OK so the current regime have been running the council for nine years. Who is responsible for the “weaknesses and areas for improvement” and why weren’t they improved years ago. No one to blame. No one to hold accountable.
Overall a sorry set of responses which illustrate what a mess they are in.
Tuesday, 1 March 2011
Council meeting farce and the Private Army
I will leave the details of the council meeting to those more competent at reporting. I will however share my experience of the evening. Turning up at the Town Hall at 6.30 I joined a queue of people hoping to get into the public gallery. After 20 minutes in the freezing cold I eventually got to the front of the queue. Ten people at a time let in. As I walked through the front door I was greeted by lines on police on either side. Up the stairs and into the chamber - ah no sorry its full, go to the room down the corridor. There was where I met some of the Private Army, security guards from a company called Met Pro Rapid Response in black army style fatigues and padded jackets. I found their presence most intimidating. Anyway the meeting kicks off and we find that we are staring at a blank screen, it is an audio link only. What a complete waste of time. Disconnected voices issue from the loudspeakers no announcement of who they are. The meeting proceeds but a number of people in our ante room simply give up and leave. Bully boys ask where are you going - you even need permission to go to the toilet! Eventually it become clear that there are 17 seats available in the public gallery. One of the Labour councillors asks the Mayor if we can be some of us in the ante room can be allowed into the public gallery. Oh no says the Mayor, the Police have advised against it. So someone came and asked the Inspector, who I have to say seemed an eminently polite and reasonable chap. Yes, 17 people can go in but ideally they should be Barnet residents. We are summoned up from the ante room and are about to be shown into the public gallery by the police when up sweeps an anxious looking Nick Walkley. No you can't go in putting his arm up and stopping me from entering. Hang on a minute the Police have just told us we can - make your mind up. Next up comes a breathless Craig Cooper - no the Mayor has said you can't come in even though we are all respectable residents and we have been advised to do so by the police. What a total and utter mess and a clear sign that democracy is not working in Barnet even though the Mayor insists it is.
Overall tonight was an abject example of a tin pot regime completely and utterly out of touch with the people they are there to represent.
Mrs Angry, you are right Barnet is broken and it is a damn shame!
I've got a pass and I'm on a mission
Mr Reasonable believes in the freedom of the press including bloggers and the ability of residents to see what is going on in their name so I am going this evening with my official Barnet Bloggers Pass - well its as official as Barnet saying we can't film!