Agenda Item No
The Vale of Glamorgan Council
Cabinet Meeting: 29 July 2013
Report of the Leader
Regionalising Regulatory Services Project
Purpose of the Report
1. To provide Cabinet with an update on the progress being made to create a shared regulatory service between Bridgend, Cardiff and Vale of Glamorgan Councils.
2. To seek approval for the preparation of a detailed business case for the project, overseen by a Shadow Joint Committee. Once completed the detailed business case will be reported to each Authority for approval later in the calendar year in order to create the collaborative service.
1. That Cabinet approves the proposal to prepare a detailed business case for a regionalised regulatory service comprising Environmental Health, Trading Standards and Licensing which will be reported back to each Authority for approval by the end of the calendar year.
2. That Cabinet endorses the proposals that:
· The Chief Executive from Bridgend Council undertakes the role of Chief Executive Project Sponsor;
· The Head of Regulatory Services from Cardiff Council assumes responsibility as the interim project manager for the initial development phase of the project;
· During the preparation of the detailed business case that the Heads of Regulatory Services from each Council be authorised to continue to work together to support preparations for the proposed collaborative service whilst ensuring continuity of service.
· That a shadow joint committee be established to provide overall direction for the project pending decision by each authority as to the way forward. It is recommended that the shadow committee should comprise two members from each authority.
It is recommended that Cllr Neil Moore and Cllr Bronwen Brooks represent the Council on the shadow Joint Committee.
3. That Cabinet approves the following to provide the necessary short-term direction to the development of the project:
· That the Shadow Joint Committee considers a range of collaboration models, including a Joint Committee, to provide governance to the proposed regional regulatory service and collectively makes a recommendation to each council’s cabinet;
· Should the shadow Joint Committee recommend a governance model that requires a host (employing) authority, that the business case subsequently be developed on the basis that the Vale of Glamorgan Council would be the host (employing) authority;
· The governance arrangements be a matter for the authorities to finally determine when reported back to Cabinets;
· The proposals will be the subject of detailed consultation with the staff affected by the proposals and their trade unions during the development of the detailed business case.
4. That Cabinet delegates authority to the Head of Paid Service, in consultation with the Leader, to enter into an interim collaborative working agreement to facilitate the further development of the regional regulatory services proposals, reflecting the proposed way forward as set out in this report.
Reasons for the Recommendations
1 - 3 To reflect the council's wish to work in partnership in relation to regulatory services collaboration and to provide a basis on which the shared service operating model will be created and financially appraised as part of the development of the detailed business case. To ensure appropriate consultation and engagement with staff and trade unions. Once complete, this business case will be subject to review and ratification by each Council's Cabinet. To provide the relevant resources to effectively and jointly manage and develop the project and to ensure continuity of service provision.
4. To provide a framework to progress the project in the interim, subject to a business case ratification and approval.
3. In 2013 each Council received reports on potential collaborative working projects and bids to the Welsh Government's Regional Collaboration Fund. This included proposals to create a regional regulatory service. Funding of £250,000 for this project has been secured for 2013/14 to support the project's development and implementation. Funding for a further two years has also been approved in principle by the Welsh Government for a further £250,000 per annum.
4. It is proposed that a single shared service would be created comprising the Environmental Health, Trading Standards and Licensing functions of each Council under a single management structure. The governance arrangements for the new service will be considered as part of the detailed business case and an options paper presented by Officers to the shadow joint committee for a recommendation to be made by that shadow Committee to the Cabinet in each authority. It is proposed that Scrutiny arrangements would also be put in place in due course following consultation with each Council and the Welsh Government.
5. The anticipated financial and non-financial benefits of the project (to be tested as part of the preparation of the business case) include and are not an exhaustive list:
To proactively develop a robust and sustainable collaborative service best placed to meet future service and financial challenges;
Development of best practice for the benefit of businesses and consumers;
Enhanced flexibility and service resilience to respond to emergencies and changing levels of demand through economies of scale;
Opportunities to enhance workforce development and embrace innovative technical and mobile working practices;
Financial efficiencies in excess of £1million across the three authorities to assist in meeting the needs of the councils' medium term financial plans;
Improved access to a wider range of specialist knowledge;
The creation of a transferrable model for collaboration from which the councils and other bodies can learn to improve future collaborative working projects.
6. A project team has been established, chaired by the Chief Executive of Bridgend Council and comprising the three Service Managers and representatives from corporate services (Finance, Legal, HR, ICT, Communications, project management) from each of the three Councils. The project team is currently undertaking the initial phase of work and reporting progress to Chief Executives regularly. Work completed to date includes the base lining of financial and employment structures of the in-scope services and the development of mechanisms for engaging and consulting with key stakeholder groups, such as Elected Members, staff and the trade unions.
Relevant Issues and Options
7. The initial project team work has considered a number of potential models of collaborative working, including existing collaborative work underway between the authorities, work done by other local authorities on collaborative regulatory arrangements and guidance issued by bodies such as the Welsh Local Government Association.
8. The detailed business case will consider in detail the proposed governance arrangements, management and employment structures.
9. Building on the above, one approach could be that the shared service could be governed by Joint Committee that would need to be established under Section 102 of the Local Government Act (1972) in addition to the existing Licensing Committees and Sub-Committees of each council.
10. The Joint Committee model would allow certain functions or a range of activities to be carried out by partners on a joint basis, reducing duplication and generating economies of scale, whilst ensuring political representation and transparency for all partners and the public. The Joint Committee model is a model that the three authorities have successful experience of using for other collaborative projects.
11. Licensing cannot be delegated in the same way as Trading Standards and Environmental Health functions and therefore the existing Committees and Sub-Committees will continue to operate in each of the councils for this area.
12. The Committees would oversee the operation of the shared service. These proposals will be considered as part of the detailed business case and in consultation with trade unions and staff. Consideration will be given to opportunities to implement innovative technical and mobile working practices as well as consideration of office locations across the three local authority areas.
13. A decision will be required in due course in respect of the provision of corporate support (such as Legal, HR, finance and communications) to the shared service and this will be informed by the detailed business case.
14. Should the shadow Joint Committee recommend a governance model that requires a host (employing) authority it will be necessary to determine which authority would undertake this function in order to prepare the business case. The recommendations provide that should the shadow Joint Committee recommend a governance model that requires a host (employing) authority, that the business case subsequently be developed on the basis that the Vale of Glamorgan Council would be the host (employing) authority. This is so that a detailed business case can be prepared. In proposing this the following criteria were considered. Firstly, all authorities were willing to act as host and secondly, each had the capacity to act as host (in terms of the ability to take on the extra workforce and provide quality, timely and cost effective support services). Accordingly, other factors have been considered.
15. In terms of logistics, the Vale is the most centrally based of the three local authorities and maintains strong current collaborative and operational working relations with both Bridgend and Cardiff. This would not negate the desire to embrace other innovations in mobile and agile working practices, nor dictate where citizens can access services. The detailed business case will consider how the services can be delivered to ensure they can be accessed where needed. This proposal is congruent with the wider considerations set out in this report.
16. Given the sensitivity as to the ultimate decision of the collaborative model to be adopted, including as to who the host authority would be (should the recommended collaborative model require the same), appropriate engagement and consultation with the trade unions and staff will be essential. This will feed in to a final decision that will be made by the authorities when this matter is reported back to each Council's Cabinet following the completion of the detailed business case.
17. It is proposed that a shadow Joint Committee be set up to provide overall strategic direction for the project. The Shadow Joint Committee will provide a useful forum to engage with members throughout the project. Given its "shadow" status the Shadow Joint Committee will not be responsible for making any formal decisions in respect of the project but would make recommendations to the Cabinets in each council. Any decisions to create a proposed regionalised regulatory service and as to the form of collaboration (governance model) would be reported back to each authority for decision following the development of the detailed business case.
18. It is proposed that the Chief Executive of Bridgend Council will be the project's Sponsor. This role will involve liaising with Chief Executives and elected members from each of the three councils and ensuring effective consultation with staff, trade unions and other stakeholders. The Sponsor will be responsible for, following the overall direction of the Shadow Joint Committee, providing the direction for the project, overseeing the work of the project manager and chairing the project team.
19. To progress the project efficiently on a day-to-day basis, the need for one of the three Heads of Regulatory Services to take on the role of project manager has been identified. This would be for an interim period until a senior management structure for the proposed new service is in place, anticipated to be early in 2014. It is proposed that the Head of Regulatory Services from Cardiff Council carries out this interim role with effect from 2nd September 2013, working closely with the service managers from Bridgend and the Vale of Glamorgan Councils to support the initial stages of the project. During the preparation of the detailed business case it is proposed that the Heads of Regulatory Services in each Council will continue to work together to ensure continuity of service and to support preparations for the proposed collaborative service.
20. The project manager will liaise with the Project Sponsor, elected members and staff from all three councils and oversee the delivery of the work packages during the implementation phase of the project. This arrangement will be funded through the Regional Collaboration Fund grant. The post-holder will remain on their existing terms and conditions during the interim period.
21. For the avoidance of any doubt the interim project manager will not be responsible for making decisions in respect of the proposals (with the decision as to the way forward being a matter for each authority), would declare and refer to the project sponsor for consideration any aspect of the detailed business case or developing proposals that may directly affect his own employment rights/ opportunities and that the role of the external support in terms of bringing independence to matters be noted.
22. Other support arrangements may need to be put in place in Bridgend and the Vale of Glamorgan Councils as the project develops.
23. The above arrangements for project sponsor, project manager and proposed host authority spread responsibility across the three authorities.
24. In order to facilitate further progress, the project will now undertake a procurement exercise to engage external support for the development of three specific documents: a target operating model, detailed business case and implementation plan and to test the assumptions made as set out in this report.
25. The target operating model will describe how the service will be structured, the key processes it will use, ICT requirements and interfaces with existing council services. The detailed business case will provide a financial analysis of the proposed operating model. The implementation plan will indicate how the shared service should be established, providing a breakdown of the tasks required.
26. External support has been selected as the most appropriate way to resource this part of the project due to the ability to provide independent, specialist knowledge and capacity for a short period of approximately 12 weeks. The project manager will closely manage the work to ensure quality, focus and timeliness of outputs. The work completed by the project team to date will minimise the amount of time initial data analysis takes and ensure the focus of this work is on delivering useful, tactical documentation.
27. The project team will continue with complementary activities whilst the target operating model, business case and implementation plan are developed.
28. It is anticipated that the implementation of the shared service will be delivered by Officers from the three councils.
Resource Implications (Financial and Employment)
29. The proposals contained in this report outline how the Regional Collaboration Fund Grant will be spent in delivering the project.
30. As the grant receiving body, the Vale of Glamorgan Council will let and manage the procurement of external support. The Vale of Glamorgan Council's Cabinet has delegated authority to the Managing Director, in consultation with the Leader, to award a contract for project support to the Regulatory Services project following a procurement exercise, after consultation with the Chief Executives of Bridgend and Cardiff councils [Cabinet Minute C1348]. The evaluation panel for the external support will be representative of each partner authority.
31. The combined budgets of the three councils' in scope services equate to approximately £8million. The development of the business case will outline the financial implications of the shared service. In particular, the business case will provide details of how efficiency savings in excess of £1million can be generated across the three authorities. The level of service to be provided (and associated cost) as well as the charging model will also be presented in the business case.
32. Once formulated, the business case will be subject to decision by the Cabinets in each authority.
33. There are employment implications associated with the proposed adoption of the host authority model as outlined above.
Sustainability and Climate Change Implications
34. There are no direct sustainability or climate change implications as a result of this report. The creation of the shared service will involve rationalisation of office accommodation and the innovative use of information technology to improve efficiency and reduce the impact of the service on the environment.
Legal Implications (to Include Human Rights Implications)
35. Whenever councils consider working together then a decision will be required as to the collaboration model to be adopted. There are a number of models that can be adopted. . In determining the collaborative model to be used it is important that the decision is based on a detailed analysis of the costs, benefits and other implications of adopting the model proposed and options available. Whilst some analysis work has been undertaken, leading to the proposals set out in this report, it is intended that a detailed business case, target operating model ('TOM’) and implementation plan will be prepared. These documents are intended to provide the detailed analysis required and act as the basis for an informed decision to be made when this matter is reported back to each Council seeking approval to create the proposed joint service.
36. The project team comprises officers involved in the service provision, which is desirable given their substantial knowledge of the subject matter. In order to address any potential conflicts of interest that may arise or be perceived it is proposed that (I) the safeguards referred it in paragraph 21 of the report are put in place and (ii) external support is engaged to develop the detailed business case, target operating model and Implementation plans. The external support will provide independence and test the robustness of the work done by the internal project team.
37. In parallel to the work being done on the detailed business case the councils' legal officers will be preparing the documentation (legal agreements) that would be required to set up the regional regulatory service, should such a decision be made. Key aspects to be addressed include the proposed governance arrangements, , how the authorities financial contributions to the running of the service will be calculated, staffing and pensions, provision of ancillary services such as HR, legal and financial services, and how an individual authority could exit the arrangements if so desired/termination. In addition proposals for common scrutiny arrangements will also be prepared.
38. There are a number of legal powers available to the Councils to facilitate the proposed collaboration. It should be noted, however, that there are limitations when it comes to licensing activities and the detailed proposals will address how those licensing functions will be carried out by each Council and be supported by the proposed collaborative service.
39. The proposals raise sensitive employment implications for staff (including staff who support the services concerned) and the employment law implications (including potentially TUPE) and requirements as to consultation will be further considered as part of the development of the detailed business case
40. It is proposed that an interim agreement be concluded to formally record how the authorities will work together to develop the detailed proposals for this project and to ensure compliance with the regional collaboration fund grant conditions.
Crime and Disorder Implications
41. There are no specific crime and disorder implications associated with this report. It is anticipated that the creation of a shared Regulatory Services function will enhance the ability to prevent, detect and manage relevant activity across the three council areas.
Equal Opportunities Implications (to include Welsh Language issues)
42. As part of undertaking the project an Equality Impact Assessment will be completed to identify the implications of the proposals and the councils' duties under Equalities legislation will also be considered as the detailed business case is developed.
43. This report outlines specific proposals to change the nature and delivery of Regulatory Services across the three councils as outlined above.
Policy Framework and Budget
44. This is a matter for Executive decision by each council's Cabinet.
Consultation (including Ward Member Consultation)
45. Engagement with Leaders and Cabinet Members has commenced on the initial phase of the project via the Regional Collaboration forum.
46. A group has been established for communicating and engaging with the recognised trade unions in each of the three councils for this specific project. As part of the development of the communications strategy and plans initial staff briefings have been held across each council and will continue throughout the project.
Relevant Scrutiny Committee
47. Corporate Resources.
Regionalising Regulatory Services - Regional Collaboration Fund Bid to Welsh Government.
Sian Davies, Managing Director, Vale of Glamorgan Council
Darren Mepham, Chief Executive, Bridgend County Borough Council
Christine Salter, Interim Head of Paid Service, Cardiff Council
Tara King, Chief Officer City Services, Cardiff Council
Lee Jones, Group Manager - Public Protection, Bridgend County Borough Council
Alun Billinghurst, Head of Public Protection, Vale of Glamorgan Council
Reuben Bergman, Head of Human Resources, Vale of Glamorgan Council
Elizabeth Weale, Operational Manager - Legal Services, Cardiff Council
Ian Lloyd-Davies, Communications Officer, Cardiff Council
Tom Bowring, Business Process Re-engineering Team Lead, Vale of Glamorgan Council
Deborah Exton, Group Manager - Finance, Bridgend County Borough Council