A study among local authorities in the West Midlands has revealed how better property asset management will make substantial savings, which, when extrapolated throughout the nine English regions, could yield as much as £6.5bn.
The pilot study, just published, examined the potential for improving property and facilities management among seven local authorities in the West Midlands and identified savings across the entire region of £640m including revenue savings of £173m and capital returns of £467m. The measures proposed would also make further unquantified savings because they would obviate the need to carry out a backlog of maintenance work as well as reducing the collective carbon footprint by 50,000 tonnes per year.
Carried out by consusultant PriceWaterhouseCoopers on behalf of Improvement and Efficiency West Midlands and the 4ps (now Local Partnerships), the study, called "The Way Forward – Transforming Local Government Property Asset Management", looked at property owned by the councils of Staffordshire County, Bromsgrove District, Redditch Borough, Tamworth Borough, Walsall and Coventry city.
PWC's recommendations are based on the idea that local authorities have inherited too many buildings that are in the wrong place, not suited to "delivering today's customer-focused services" and occupied by "silo" services rather than local partnerships. In addition to reducing councils' own office space by 30%, the solution includes disposing of 15% of councils' operational property and re-providing it in two thirds of the space, thus saving 5%.
If the capital released by doing this in the West Midlands was reinvested it could provide fifty new "joint service centres" according to the report, which might accommodate a library, administrative offices, a primary care health centre and "public interface facilities". The report cites a building in Cambourne, Cambridgeshire, as the model for the joint service centres.
The study also suggests that local authorities should share services and facilities to a much greater degree, in line with the government's Operational Efficiency Review, published in April.
