The London Borough of Barking and Dagenham identified a need to establish a partnering arrangement to bring private sector expertise to bear on the public sector challenges of modernising ICT and other back-office services.
The Borough wanted to use this arrangement to leverage additional jobs into the area, in support of its regeneration strategy, and was also keen to maximise opportunities for partnership working with other local authorities, recognising the shared services agenda, and a desire to achieve economies of scale. The Borough issued an OJEU in 2009, which sought innovative solutions, and gave a growth opportunity to bidders, meaning that the Council was keen to extend the services offered by the partnership over time via further service transfers.
The services that the Council decided to include in the first instance were:
- Revenues and Benefits
- Contact Centre and One Stop Shops
These services were at varying levels of maturity and performance, with a need to achieve significant cost reductions. The contract was let at a point where budgets to local government were being significantly reduced, and the proposed solution needed to accommodate this.
At the same time the Council was looking for jobs growth, with a target of 400 new jobs over the life of the contract.
Finally the Council was keen to establish a contractual arrangement which was flexible, and allowed for scale and scope change, as well as the introduction of new services, and new customers – and which created commercial incentives around performance.
The Agilisys proposal was to create a joint venture which was owned 50:50 by the London Borough and Agilisys. Underneath this arrangement was a service contract between the Council and the newly formed joint venture, Elevate, where various commercial arrangements were established to ensure performance, and continuous service improvements.
A Scale and Scope mechanism was agreed which allowed both parties to deal with changes in demand, and different service requirements over the life of the contract.
It was agreed that services would move towards achieving upper quartile performance when compared to peer group local authorities, and that savings against the initial cost of the transferred services would be baked into the contractual arrangements.
The commitment to establishing 400 new jobs was included within the partnership agreement, with financial consequences for non-performance emphasising the criticality of this requirement.
The governance of this arrangement was via Council Member and officer representation on the Board of the Partnership, which was established as an LLP (Limited Liability Partnership), together with Agilisys representation. This allows a true partnership approach to the running of Elevate. Alongside this is a Strategic Partnering Board, which is chaired by the Lead Council Member for Finance, and where broader strategic issues relating to the partnership are discussed. This Board has very wide membership, including backbench Council Members and Unions, as well as senior Council, Agilisys and Elevate officers, and allows for strong ownership of the activities of Elevate.
Within the first year the Council has decided to extend the services provided by the partnership and has transferred in the following:
- HR Transactional Services
- Reception and related services
- Capital Programme back office support
- PFI contract management
- Property Services
This has been done within the contract mechanisms already established, meaning low legal costs to implement.
Elevate now employs approximately 430 staff engaged on the various services outlined, each performing to a high standard, and costing less than in the previous year.
Within the first year of operation the following headline achievements have been delivered:
- Over £2M extra revenue collected, including the highest Council tax collection in over ten years
- Over £500k savings per year on IT application budgets, with a further £500k costs avoided by utilisation of Agilisys’s wider buying power and technology innovation
- Reduction in the average number of days for a claimant to receive benefit from approx. 50 days to approx. 10 days, meaning that residents are more able to pay their bills in a timely way
- 56 new jobs created
- Service improvement plans implemented resulting in better self service for council staff, and delivering a number of channel shift projects, meaning that residents can access more services online, including some self service facilities
- Savings on the cost of services of £1.7m in Year 2
- Coped with increased volumes in the Benefits service, (approx. 40% increase in Change of Circumstances notifications from the DWP)
- Rectified a number of long-standing systems issues
- Improved the resiliency of IT systems, thereby reducing outages and downtime
On top of these tangible benefits, the Elevate team have become a valued part of the Council team, sitting alongside Corporate and Divisional Directors, and supporting the Council in delivering services in very challenging times.
There are ongoing plans for further savings and service improvements over the life of the contract, including the growth of the partnership to include other customers within the local government sector. It is this platform that will drive much broader economies of scale, and allow the partnership to drive further efficiencies, utilising Agilisys’s sector experience as fully as possible.