The Can't be Bothered Generation!
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Posts
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Hello Matt –
I’ll premise it all by saying it’s an idea that I’ve seen work in places such as Liverpool and Newcastle and I’ve noted that it’s something that we’ve never actually done in Wrexham ( to my knowledge – someone correct me if I’m wrong.) – so bare with me and take ideas with a pinch of salt please!
I can’t deny privatisation because it would technically privatise it, albeit owned and responsible to the public authority but with a commercial aim. But this is not me being all right wing on council services. It’s just an idea to try and create a revenue stream (without overly burdening us residents as council tax payers), sadly we have to balance the books at some point and yes it isn’t necessarily Wrexham council (or residents’) fault that the UK Gov and Welsh Gov have made the decisions that they have made. I don’t necessarily want to privatise things, that’s not in my ideology to be fair. However, if it is a mechanism we can use to ensure that there are not more severe then it’s something I think we should look at. I agree in principle with your comment on local users of the service getting it for free / highly subsidised.
Speculate to accumulate on section 2. A little investment in staffing / resource via a long term loan. If this trading company will be bringing in a crust, it’ll be more able to pay for itself than the council.
Yes a council owned trading company would potentially be competing with local businesses. But a refuse trading company could potentially take the place of Ash Waste ( who take a lot of local businesses’ waste) – a NFP trading company could better service the area as well as potentially save local businesses money. It may cost more… hence why it’s just an avenue to explore rather than “here are the answers”. Cornwall council did something similar I believed but used a NFP trust (same idea, but the assets are effectively leased from the council). Was due to save a million £ just in things like VAT and NDR’s. The target for the next year is £5 million. Whilst I’m not suggesting everything happens tomorrow, again I believe it’s worth looking at.
4) How will generated profits be transparently protected from being either awarded to councillors in the form of numerative and non-numerative benefits (they already awarded themselves iPads) or stopped from being wasted on the likes of expensive consultancy fees elsewhere in less efficient areas of operation that would likely wipe out said profits?
2 mechanisms, it’s its a trading company then operating profit can replace the initial loan & left overs used as dividends. Alternatively it can be stored within the company as retained profit allowing another mechanism to store the council’s reserves.
if it’s a NFP trust, council ‘should’ be paying less than they would at the moment causing savings in the budget.
Apologies – final one…
Personally, I think the iPads are useful. Just from my campaign I’ve realised having my tablet with me (surface pro 4… excellent kit!) would have been a lot easier to safely record casework as well as be a bit proactive in how the casework is achieved. The amount of times I’ve had to revisit residents when I could have managed it in 1 go had I had brought my tablet that particular day is quite astounding. It’s all about providing tools that increase customer service. Initially I was sceptical about replacing them and thought that the new intake should decide. Now I’ve just accepted the idea and want to make the best of the situation we have.
Regarding remuneration – the independent body tasked with setting councillor’s pay is independent for a reason – so councillors do not get involved. There is a mechanism in the constitution for councillors giving up whole or part of their salary however.
The consultancy fees – difficult one… do I believe they require consultants now and then – yes. I’ve worked in many places that have been improved by them. However, I’ve also seen it end up in a situation where it’s money for old rope. Perhaps the solution is for the idea to be implemented as a NFP Trust ? I’m sure there are advantages and disadvantages I’m not wholly aware of though. Again… pinch of salt please :)
The creation of Council run trading companies has one immediate effect which is t destabilise the commercial market as the Council have many ways in which they cross charge or hide operational costs within their financial systems.
It is virtually impossible for any Council run business to compete in the open market if all costs are taken into account. If the company was to retain staff on the Local Government pension scheme under TUPE (transfer of staff) each would still have a 29% pension contribution being levied. This figure is based n 8% for current employees and a contribution of an additional 21% to cover the Pension Fund deficit.
This level of cost base is unsustainable – with all the cuts that have been taking place and less people contributing to the Pension scheme the next revaluation of the fund could result in the 29% increasing even further. Something that every reader and business of the forum will have to pay for through their rates.
I’d agree the idea needs work to make it viable.
However I’d disagree with you saying it’s virtually impossible for any council run business to compete. Look at Norse Group for example? That’s a Local Authority Trading Company who’s a massive success.
Yes – there are a lot of LATC’s that have failed, including an IT services LATC in Chester. However it is just an idea to be banded around at this stage.
CORMAC which is in Cornwall is another massive success… bringing in £20 million between 2012 and 2015. Unsure of more recent numbers.
I’m sure you’ll be able to find numerous failures (I’ve already found many myself) but it goes to show that it can be done.
The creativity of the financial arrangements is what makes most of them unviable plus the most important element is not having managers who are commercial– under the employment requirements all existing Council staff and managers would be entitled to move to a new company most would not have a clue how to change a fully funded service into a profit making one. There certainly does not appear to be the expertise in Wrexham Council — look at the fact they brought in consultants at a huge cost in order to come up with the necessary service and financial cuts. Fact they could not make littering and dog fouling into a service that pays so they empty an external firm.
I do accept that there are some opportunities but without the right calibre of managers this will never happen-
One example of a ‘deal’ that is making money for reinvestment in service for local people is the Robin Hood Energy Company set up by Nottinghamshire Council- this is now providing one of the cheapest energy in the country — thus product benefits all of their customers whilst making money for local services. The structure is a commercial arrangement with an energy broker to run the back office whist fronting it in the name of the Council.Conde thank you for actually taking the time to respond to my scrutiny. It is interesting that other councils have been able to set-up commercial ventures with many others in the process of doing so. The Wirral has dubbed their plan Wirral Council PLC and interestingly Salford Council has a team of 10 specialist software engineers to roll out commercial IT services for profit.
The articles I read lead in with the fact that they were competing directly with the private sector and in the Liverpool / Manchester regions where these councils are situated I think competition is very strong and this is fair game.
However, I think private enterprise in Wrexham needs a leg up to get things going. I would rather see the council working hard to support local start-ups to get things off the ground. Glyndwr Uni has their business incubator set-up but there would be no reason why the council couldn’t go about helping to set-up other incubation or accelerator type initiatives with support from the Welsh Government or other public or private funding sources. I think more could be done to try and attract other high tech firms either in manufacturing (we have huge industrial estates and excellent transport links) or services such as fintech. This type of commercial activity support would boost inward investment and skilled job creation in the area and in turn boost the whole regional economy. I appreciate this sort of undertaking is difficult due to getting financial and assembly backing. But it’s what I would like to see more of.
Not a problem Matt. I don’t think any 1 person has the answer to this and the only way we are going to get there is by all banding ideas together. I find it shameful when their are candidates (or Councillors) for that matter that don’t engage. What is the point… :)
It may not be the be-all, end-all answer, but I think it’s something that should be given a decent amount of consideration. For example is this something we can roll out from Wrexham, servicing surrounding counties. Answers I don’t know – however it may be an option.
Quite agree with your comments about accelerator programs. It’s something I’m very much in favor of and will continue to support.
One of the biggest things I think the Council can do (apart from campaign for lower NDR’s (set by Welsh Gov sadly)) is to be a bit more flexible with commercial leasing options for start ups. I’ve mentioned many times that even if it’s cost price, filling up commercial property is preferable to it being left empty. It attracts more footfall and promotes employment within the county. Then when demand increases, things get renegotiated.
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