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In-house Division

Local government – shared services and new models of delivery

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Shared services may not be a wholly original model, but their application in a changing, and an increasingly challenging environment is bringing a fresh approach. Angela Hutchings explains

I am the interim director of Essex Legal Services (ELS), which is an in-house legal team specialising in advising Essex County Council and other public sector clients. I was asked to deliver a breakout session entitled ‘Local government - shared services and new models of delivery’ with Olwen Dutton of Anthony Collins Solicitors at the Law Society’s In-house Division annual conference on 15 June 2016. I confess that I was initially stumped by the title of the session. Local government has a long established history of sharing services with partners in the public sector, especially other councils and the NHS, and local government lawyers likewise. It is nothing new!

The history of shared legal services in Essex

The Public Law Partnership (PLP) was created in 2007 by ELS and Suffolk County Council’s in-house legal service. The concept was not a formal joint service but a partnership to share resources including e-library procurement, a case management system, and training, and commission legal work from each other with a view to making savings, generating income and developing its workforce. PLP was successful in obtaining a grant from the East of England Regional Economic Integration Programme, which was used to develop a case management system across PLP as a core project for some parties. PLP has expanded to include all the district and borough councils in Essex along with Southend Borough Council. In 2009, Hertfordshire County Council and the district and borough councils in Hertfordshire joined PLP. In 2013, South Cambridgeshire District Council and Cambridge City Council also joined and membership currently stands at 30 authorities.

Secrets of success

PLP has been able to achieve considerable buy-in because it allows partners flexibility: although PLP has formal governance arrangements and participating authorities pay an annual subscription, there is no obligation on any authority to participate more than it wishes.

PLP has, in the past, benefitted from employing a consultant who acted as project manager to the various initiatives commissioned by PLP. These have included:

  • an internal market place for buying and selling of legal services between PLP authorities at preferential rates
  • shared professional e-library subscriptions
  • a shared case management system
  • a database of fixed counsels’ fees to enable visibility, comparison and transparency of fee negotiation
  • shared training opportunities

The strength of shared legal services in the public sector lies in the fact that, although sometimes the politics complicates things, generally we are not in competition with one another, we are all engaged in public service. That might sound like a naïve statement, but the public sector is built on inordinately strong personal relationships and leveraging these is the primary means of getting things done. Public sector lawyers are no different. Even when on opposing sides, both parties are usually working on an agreed outcome which has the best interests of the public at its heart.

The drivers of ‘new’ models of delivery

As previously mentioned, it is misleading to refer to ‘new’ models of delivery in shared services – the truth is that these models have been around for some time. However, they do appear to be gaining in popularity and visibility by virtue of the current era of public sector austerity.

In local government and the wider public sector generally, the austerity agenda and the political environment is driving in-house lawyers to be more solution-focused and innovative. In my own authority, members and chief officers are clear that we simply can’t do the things we always used to do in the way that we used to do them. We are being challenged to rethink the paradigm of local government service delivery and to facilitate new ways of working which are commercially strong, yet ethically and legally defensible. We are working with members and chief officers to broker new partnerships across the public and private sectors to redefine risk and to put the citizen at the heart of everything we do.

The vast majority of local government lawyers, regardless of which tier of government they work in, are operating in similar roles. We all provide strategic, reputational and risk-based commercial advice to our parent organisations, in addition to ensuring regulatory compliance and the delivery of traditional transactional legal services such as conveyancing, enforcement and employment advice, for example. Each of us is under financial pressure not just to manage budgets but to demonstrate real, tangible (but not just cashable) value. Quite often (but not always) all that is different is geography.

However, resourcing these requirements is very difficult in small authorities where the legal team might only amount to two or three people. As lawyers specialise very quickly in their careers, it is very difficult to find lawyers who can work competently across a number of diverse legal disciplines. The general practitioner who used to be so prevalent in local authority legal teams is becoming a rarity. This increases the necessity to ‘import’ capacity or skills from other public bodies or from the private sector. I think this is driving a new era for different models of delivery.

Development in shared models of delivery

There are those public bodies who are taking existing relationships one step further and physically sharing staff either through secondments, commissioning call off arrangements or by appointing lawyers under joint contracts of employment to service their collective needs. I am doing that in my own authority – sharing lawyers and managerial skills, too.

There are also recent examples of authorities tightening up those existing relationships even further through formal shared service or merger, mirroring what is happening in the private sector, for example, the 3C Shared Service arrangement in Cambridgeshire (which comprises Cambridge City Council, South Cambridgeshire District Council and Huntingdonshire District Council) and LGSS Ltd (an Alternative Business Structure wholly owned by Cambridgeshire and Northamptonshire County Councils and Central Bedfordshire Council). Sometimes these alliances follow devolution aspirations, and it will be interesting to see how that agenda develops.

Outsourcing

Of course there is always the spectre of outsourcing. With the number of the big outsourcers and professional services firms now having ABSs, there is no bar on legal teams being swept up as part of wholesale back office outsource contracts. Some authorities have indicated that they will trade their way out of austerity – but it seems likely that the recent stance of the SRA means that it will be possible to do so only via an ABS. In any event, as I know from personal experience (Essex County Council was granted an ABS licence in April 2016) earning additional external income is not the same as trading and the development of a fully sustainable business.

A fresh approach

So in conclusion whilst these models might not be strictly new in the sense that they are wholly original, their application in a changing, and an increasingly challenging environment is breaking up old ways of working, compelling local authorities to begin anew and bring a fresh approach to the delivery of legal services in a transformed way - that works for me as a definition of ‘new’.

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