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Date
24 August 2017

How local authorities can attain the skills for success and successfully bridge the funding gap

It has been widely reported that following central government cuts, local authorities are increasingly operating entrepreneurially. Many local authorities are working collaboratively to cut costs, making partnerships or alliances with the private sector, and investing in property or various enterprises, all to raise more revenue and fill the funding gap. However, whilst the decentralisation of power is resulting in great innovation and empowerment within local councils, there are concerns that a lack of commercial skills could put finances at risk.

At the end of November 2016, the Public Accounts Committee voiced fears that council tax bills and other services could be affected by poor investment decisions. Committee Chair Meg Hillier stated, “Our committee has previously highlighted gaps in the commercial skills of the civil service as a factor in the failure of some projects and we have similar concerns about local government.”

As local authorities undertake increased commercial activity and invest in property in order to become self-sufficient, naturally they take on greater responsibility and subsequently more risk. If such schemes are to be successful, it is vital that the key personnel involved are equipped with the necessary skills. Local councils need the skillset not only to invest and manage wisely, but to grow these initiatives to make a surplus to reinvest in their services and maintain the quality of the user experience. As summarised by Sean Nolan, the Director of Local Government at CIPFA, “Today council finance teams must possess the ability to undertake a range of roles, depending upon the context and demands of each situation. Whilst understanding all the associated risks, they must be fully instrumental in delivering growth.”

arena4finance is proud to renew our ongoing strategic partnership agreement with APSE, which includes offering a one-day skills development workshop for all those within the public sector who are looking to offer services to private companies and the local community in order to generate profitable revenue. The team at arena4finance are specialists in financial training for the service sector. Debra Adams, Head of Professional Development, comments, “We offer training, coaching and mentoring to help business managers understand and interpret financial information and we are delighted to be able to offer this support to the public sector in these challenging but also exciting times”.

APSE is a not-for-profit local government body working with over 300 councils throughout the UK. In a recent study, published by APSE in conjunction with CIPFA, entitled ‘Bricks-Mortar-Money’ focusing on the trend for increased commercialisation of the local government property estate as a means of securing additional income streams, it was concluded that there are three key drivers impacting on the recent trend. Firstly, the impact of austerity with cuts in funding and increasing cost pressures has intensified the need for alternative income sources. Secondly, local authorities are being encouraged to become more self-sufficient with less reliance on funding from central government and finally, the requirement for local leaders to take responsibility for shaping how their communities are managed in the future.

The workshop offered by arena4finance and APSE entitled How to make a profit from selling your local authority services will benefit those with responsibility for creating new revenue sources requiring them to create pricing policies, develop business plans and monitor results. Using a variety of case studies and scenarios during the sessions, participants will consider the key variables for their success including; identifying opportunities for profitable income generation; understanding the true costs; developing expertise and entrepreneurship; managing the risk; and considering the systems and processes for monitoring performance.

Speaking about the course, Jan Kennedy, Head of APSE Training, said, “This excellent workshop has been specifically designed by arena4finance and APSE to support local authorities as they try new ways to find a sustainable form of income that can support their frontline services. Austerity measures continue to affect local councils, so we have worked to create an accessible course that covers everything your organisation needs to know about effectively making a profit from your existing services.”

By the end of the course attendees will be able to; cost activities, products and services accurately; develop standard costs; apply overhead capture and cost allocation; set selling prices and produce quotations; calculate the breakeven point and plan for profit; use and interpret key performance indicators; and perform post activity monitoring and variance analysis.

To learn more email hello@arena4finance.co.uk for more information.

Alternatively, book directly with APSE at www.apse.org.uk/apse/index.cfm/training, or email Jan Kennedy on jkennedy@apse.org.uk or call 0161 772 1810.