Pictured above: Laura Stamboulieh

A survey by global real estate adviser DTZ has revealed that 42% of local government organisations are missing out on millions of pounds in potential savings by not collaborating to use assets efficiently.  

This is despite the belief among the overwhelming majority of senior local government officers that collaboration initiatives can achieve significant cost reductions.

DTZ, which advises one in three local authorities and more than 30 central government departments on their property strategy, surveyed more than 100 key decision makers across a range of local government bodies to assess the progress of collaboration across the public sector following the Total Place pilots.

The findings show that almost half of the public sector organisations surveyed have yet to formally introduce a collaboration programme, and are thus failing to achieve considerable property cost savings that could help protect delivery of frontline services.

Laura Stamboulieh, Director in the Public Sector team at DTZ covering the Midlands and South West, comments: "There is a dominant view among senior local government officers that co-location, for instance, is financially advantageous and would unlock service delivery benefits as well as improve customer service.  With 71% believing that collaboration can occur without intervention from Whitehall, our study reveals a real willingness to re-examine the fundamentals of how the public sector should operate.

"However, if public sector entities do not collaborate to reduce property costs, which represent one of their most identifiable and manageable overheads, this raises serious concerns about their ability to adapt to life after the Spending Review."

DTZ's research also shows that 65% of local government bodies believe that shared asset utilisation and co-location with a public sector partner is the only way that true collaboration can work.

James Grierson, Head of Public Sector at DTZ, adds: "The vast majority of proposed public sector collaboration initiatives focus on co-location. However, most public bodies could cut their overheads far more considerably by pooling and collectively outsourcing a wider array of functions, from payroll to facilities and estates management."

Potential property savings alone could amount to £millions…

Although the Total Place initiative has lost pace following the change in Government, its principles still stand and the need to promote collaboration across the public sector has heightened, according to DTZ.

Reports from the Total Place pilot scheme in Kent, for example, suggested that some £40 million in revenue costs could be saved countywide by a joint re-alignment of the operational estate, rationalisation of the space occupied and associated costs. If replicated across the country, considerable savings could be realised, according to DTZ.

However, the study reveals that one in five senior local government officers see collaboration as a threat to their organisation, with less than half (48%) confident that it is not. 

…But many local government leaders lack the expertise required to collaborate effectively

Although 85% of senior local government officers expect to be collaborating voluntarily in the short to medium-term, there are serious doubts about the ability of public sector managers to implement collaboration initiatives successfully. A quarter of those surveyed felt that the strategic management capacity of their organisation would be a 'constraint' to effective collaboration.

Laura Stamboulieh, adds: "While some progress has been made, our research shows that the public sector still has a long way to go if it is to harness the full benefits of collaboration. It will not only need to ensure that it has the managerial expertise in place to successfully implement these initiatives, but will also need to address culture and attitudes among staff to ensure that all public bodies are equally committed to working together to drive down costs."