Agenda item

[Report of the Chief Operating Officer. To be introduced by the Cabinet Member for Resources and Culture.]This report seeks approval from Cabinet for a joint programme with Islington and Camden to share ICT services and integrate ICT functions.

The Cabinet Member for Resources and Culture introduced the report which sought approval from the Cabinet for the Council to join an existing shared Information and Communications Technology (ICT) service with the London Boroughs of Camden and Islington. The shared arrangements were due to commence formally in October 2016.

A review of the Council’s ICT service, carried out by SOCITM (Society of Information Technology Management), found clear alignment in the strategic direction of all three councils and the outcomes required from their respective ICT functions to deliver change and support future savings plans. The Cabinet Member emphasised that additional savings, on top of what had been identified in the Medium Term Financial Strategy, were expected as a result of joining the ICT service with Islington and Camden.

The Leader asked Cabinet to approve the recommendations set out at section 3 of the report.

RESOLVED

1.    To establish a shared ICT service between Haringey, Camden and Islington Councils;

2.    To agree that a formal executive Joint Committee be established , comprising six members, two members appointed by each of the London Boroughs of Camden, Islington and Haringey, to oversee the shared service, with a view to review options for commercial operating model within 12 months;

3.    To note that the Leader, subject to the Cabinet agreement of recommendations 1 & 2 above, will, in consultation with the Cabinet Member for Resources, make any further decisions required (and makes any appropriate delegations to officers) as to the terms of reference and operation of the executive Joint Committee and associated agreements;

4.    To authorise the Chief Operating Officer to enter into a joint agreement between the Council, Camden and Islington Councils  (as approved by the Leader) and any additional legal documentation necessary for the establishment of the shared ICT Service. This does not extend to the establishment of any future commercial governance arrangement and operating model, which would require separate member approval;

5.    To agree the Council’s maximum contribution of £2.5m to a total cost-of-change budget of a maximum of £7.5 m to support the transition across the three boroughs;

6.    To note that costs and savings for the core service offering will be shared on equal basis between the three boroughs subject to due diligence and that any variation shall be agreed by the Chief Operating Officer.

Reasons for decision

The current corporate plan and priority outcome programmes continue to create demand for different IT skills and resources which are necessary for delivering these transformation programmes.

The changing world of public services with increasing financial pressure will ultimately require innovative solutions and greater need for rapid service transformations.  Sharing ICT resources with neighboring local authorities will help the Council to deliver this transformation at greater speed and reduced cost.

The research published by LGA in 2015 identified 416 shared service arrangements between the councils across the country resulting in £462m of efficiency savings.  In Greater London there are 46 examples of shared services.

The development of shared services with Islington and Camden will allow the Council to develop digital skills to respond more effectively to changing demands on our services.

Joining the shared services with Islington and Camden will help the Council in:

• Delivering value for money and cashable financial savings,
• Consolidating the expertise and best practice from all three ICT services into one integrated and high-performing service, and
• Creating a public service structure that is resilient and is able to better withstand market conditions from both local government and beyond.
• Benefit from the transformational projects which have been already delivered in Islington or Camden.

The shared IT services will allow us to deliver improved digital services as set out in the council’s corporate plan at reduced cost through sharing of resources and skills with Islington and Camden.

The shared services proposal will allow the council to continue improving its digital offer while delivering substantive savings.

Alternative options considered

Officers and lead Members from the Council have carefully considered the underlying business case. It is felt that there is a sufficient level of benefit – both financial and otherwise – to recommend the Council joining the shared service in a joint committee model.

There was not enough evidence to justify setting up a commercial model for the shared service on October 2016.  Further research will be carried out over twelve months after the Joint Committee set up goes live in October 2016 to assess if the joint service should adopt a commercial model.

There is a significant pressure to support the Council wide transformation.  The pressure to support and deliver more with fewer resources often results in employing short term resources.  This option often increases cost of delivery in short term.  The shared service model will allow the Council to share existing resources more effectively across the three boroughs and even better value for money for residents of each borough.

The current savings profile for ICT service has achieved savings of £35k for financial year 15/16 and £170k for 16/17.  The savings profile of the shared services business case as summarised in the table at 7.12 sets out significant savings which are higher as a result of joining the ICT service with Islington and Camden.

Should the Cabinet decide that we do not engage in shared services with Islington and Camden, the Council’s ICT service will continue to deliver ICT services in its current format.

We have considered the option of outsourcing the ICT service, both to the public sector and to the private sector. The ICT service currently has various contracts with private sector organisations for some service elements as they provide value for money.  It is not envisaged that at this stage the pursuing full outsourcing will provide greater benefits than the shared services option. The shared services option provides more benefits than just financial benefits for the Council.