WMCA (West Midlands Combined Authority) Shared Services

Look at the things that all the councils in the WMCA do and do (or could do) the same way.  Gain agreement to form a public-public shared services Joint Venture, or Wholly Owned, company owned by the councils of the WMCA proportionate to how much they use  it (i.e. the volume of services it provides to them).  Use the company to provide services to the WMCA councils and as a vehicle to sell those same services to other organisations in the public, private and voluntary sectors for profit.  Apportion those profits to the owning councils proportionate to their ownership (the more services you buy the more of the profits you get).

Services ripe for moving to such a shared services company include:

* IT

* Payroll and Transactional HR

* Fleet

* Waste and Recycling

* Procurement

* Logistics

* Contact Centre

  Use the ownership control to target any contracting or procurement of work first locally, then regionally and only then nationally or internationally (so delivering John Clancy's ideal of using local suppliers).  Also, whenever possible contract with the end supplier of the service rather than 'middle-men'.

Why the contribution is important

This shared service company would deliver economies of scale, especially valuable to the other WMCA authorities that are muich smaller than Birmingham, and a reduction in management overhead.  It would also allow us to support our local economy by buying and hiring local.

By collating work from many organisations the shared services company would be able to get maximum benefit from expensive resources such as skilled specialists and equipment.  Collation of the procurement from multiple organisations would also move to an oligopsony situation with the share services company being the biggest fish in the local pond and able to, therefore, manage down prices.

As this shared services company would not need to maximise shareholder profit it would be able to undercut commercial suppliers for selling services into other (non-WMCA) organisations whilst making profits on the volume.

Finally, rules on public sector procurements mean that a public sector body procuring from another public sector body does not have to jump through as many hoops as when procuring from a private sector organisation.  By keeping the ownership and managment of this shared services company public (even if some services are delivered by existing private sector sub-contractors), procurements of services by other bodies could be done in weeks (or even days) for a few thousand (or even hundred) pounds rather than taking years, and costing both sides millions, to comply with legal restrictions.

by stephenbooth_uk on December 16, 2015 at 10:31PM

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