Report of the Local Government Efficiency Review Group

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for savings to compensate for what can be significant up-front investment costs. It is important to ensure that the volume of transactions under consideration will yield savings in excess of the costs of moving to a shared service arrangement. Transitional costs can be particularly high where organisations have incompatible IT systems. 8.2.10 The experience in both the UK and New Zealand suggests that the buy-in of local councillors and senior management at the outset is seen as critical in terms of progressing the shared services agenda. 8.3 Recent Government Policy in this Area 8.3.1 The Transforming Public Services report and accompanying Government statement recommend greater use of shared service provision, not just between local authorities but across all parts of the public service. Some of the areas where potential for shared services exist include: • Human resources, including recruitment, training and development, pay and benefits, HR advisory services and pensions; • Finance, such as purchasing, accounts payable, accounts receivable, fixed asset and inventory management, travel and subsistence, payroll, general ledger accounting and financial reporting; • Procurement – a National Procurement Service has been established within the Office for Public Works (OPW) to create additional purchasing power, to allow various bodies including local authorities to purchase goods and services and to provide professional public procurement advice across the entire public service; and • Information and communication technologies. 8.3.2 However, the report recognised that for any shared services initiative to succeed, local sponsors in senior positions must be identified to drive the initiative. Better use of information was also proposed to minimise data requests from citizens, which will require greater sharing and re-use of data across the public service. 8.3.3 Specific working groups have been established to examine the potential for shared services across the public service in different fields, such as HR and pensions, and financial shared services. In the context of local government, shared support services already exist in the provision of HR and industrial relations support, and in the area of IT support, by the Local Government Management Services Board and the Local Government Computer Services Board respectively. These two organisations have been merged as the Local Government Management Agency (LGMA), providing a significant platform for expanding shared service delivery in local government. 88
8.4 Shared ‘Back Office’ Services 8.4.1 Shared services provide an opportunity to increase efficiency through the reorganisation and sharing of assets with others and an opportunity to minimise duplication of processes, accommodation and management effort across local authorities. As well as the potential for financial savings, shared services also can lead to service improvements, greater consistency and allow local authorities to concentrate on their core business. 8.4.2 Much of the Transforming Public Services agenda concerning shared services has a focus on ‘back office’ functions and support to local authorities. This includes building on existing work in areas such as human resources, recruitment, pensions, payroll, procurement, and IT systems and design. International experience also shows that these areas tend to be the initial focus for shared service initiatives between local authorities. 8.4.3 As part of this process, local authorities are currently implementing a shared HR and payroll system, known as the CORE project. This system is currently being installed across 27 of the 34 county / city councils. All 27 local authorities are to use the standardised processes and software of the new system, with 20 local authorities also availing of a shared hosting option. Initial sites using the new system are forecasting an estimated 40% of savings in the overall resource requirement needed for the payroll function. If these savings are realised across all 27 local authorities, it could allow for the potential saving of 62 WTE staff, or almost €3 million per year. As well as payroll, the system is also projected to deliver significant savings in other HR related areas, such as superannuation, time and attendance, recruitment, the performance management system, training, and health and safety. 8.4.4 A greater use of the shared service approach to ICT, building on existing practices, is also worth pursuing. The combination of consolidation and the adoption of government frameworks for purchases of ICT equipment and services, as well as the aggregation of the sector’s purchasing power for software licences and services should yield efficiencies and savings across the sector. There is an opportunity for the sector to modernise and update its ICT service provision and technical infrastructure, by simplifying technologies, sharing technologies and resources and achieving economies of scale in technology investment and licensing costs. 8.4.5 Each of the 34 county and city councils have their own ICT unit. In addition, a shared ICT service, the Local Government Computer Services Board (currently being consolidated into the LGMA) is used by many local authorities to develop programmes used to support service provision across several local authority areas of activity. The number of ICT units has inevitably led to duplication of effort and investment across local authorities, and opportunities exist to consolidate and save on this spend. 89
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Report of the Local Government Effi
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5. Organisational Efficiency Issues
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14. Recommendations 14.1 Recommenda
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associated Government Statement, ne
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more focussed than previously on mu
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ating town councils is largely repr
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• The provision of quality custom
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1.7 Compliance Requirements on Loca
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2.1 National Public Finances 2. Bud
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Figure 2.2 - Total Local Authority
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evenue were needed for the local go
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Figure 2.3 - Sources of Local Autho
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Figure 2.4 -Sources of Local Author
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Figure 2.5 - Local Authority Curren
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Payroll Expenses Table 2.4 - Breakd
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2. Reintroducing domestic water cha
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Income €m € 1,600.0 € 1,400.0
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3. Local Government Experience of E
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Page 39 and 40: well as reductions in the number of
Page 41 and 42: 4. Context - Looking Forward 4.1 Na
Page 43 and 44: 4.2.6 Aside from keeping costs down
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Page 47 and 48: statutorily vested in certain ratin
Page 49 and 50: 5.5.6 Roads are classified into nat
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Page 53 and 54: 5.7 Other Local Bodies 5.7.1 A smal
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Page 57 and 58: Figure 6.1 - Local Authority Staff
Page 59 and 60: Figure 6.2 - Staffing per 1,000 Pop
Page 61 and 62: Figure 6.5 - Staffing Per 1,000 Pop
Page 63 and 64: Cluster Data Cluster Mayo Roscommon
Page 65 and 66: senior management staff - for examp
Page 67 and 68: ut this figure varies from 22% to 5
Page 69 and 70: eplacement with lower level staff w
Page 71 and 72: Corporate Services, HR, IT, and Fin
Page 73 and 74: to provide services in the corporat
Page 75 and 76: Recommendations: 6.11.1 In summary,
Page 77 and 78: 7.1 Local Government Audit 7. Value
Page 79 and 80: through open recruitment. Opportuni
Page 81 and 82: the Director and relevant local gov
Page 83 and 84: 7.6.3 Local authorities should cons
Page 85 and 86: 8. Shared Services 8.1 Shared Servi
Page 87: 8.2.6 Many parts of the United Stat
Page 91 and 92: 8.4.12 For example, recruitment to
Page 93 and 94: approach which will be used to asse
Page 95 and 96: enefits in terms of pooling resourc
Page 97 and 98: while also improving the service fo
Page 99 and 100: Implementation Group suggested in s
Page 101 and 102: 9.2.4 The Local Government e-Procur
Page 103 and 104: forms are now captured online. This
Page 105 and 106: Table 9.1 - Non-Pay Items Procured
Page 107 and 108: 9.5.10 LAQuotes is used by the vast
Page 109 and 110: sectoral level, to promote exchange
Page 111 and 112: 10.1 Housing 10. Efficiencies in Pr
Page 113 and 114: 10.1.9 Two issues arise in this res
Page 115 and 116: that may arise in this respect as p
Page 117 and 118: the new Housing and Sustainable Com
Page 119 and 120: 10.2.6 To date, the emphasis of tol
Page 121 and 122: 10.2.14 The Group also noted the la
Page 123 and 124: • Allocating grants to improve th
Page 125 and 126: 10.3.11 It would also facilitate th
Page 127 and 128: consumption (see also section 9 in
Page 129 and 130: Financial Summary: Through a combin
Page 131 and 132: current levels of resourcing for pl
Page 133 and 134: educe the number of such transactio
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Table 10.1 - Motor Taxation Classes
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detail in issuing licences. Motor t
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11.1 Treasury Management 11. Other
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for the overdraft, has the potentia
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• The online Roadworks Control sy
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management, etc. Use of professiona
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• Projects to streamline existing
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12. Local Government and the Wider
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significant administrative overhead
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City Enterprise Boards with county/
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suggests that financial incentives
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13. Cost Recovery and Revenue Issue
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13.1.11 The Group considers that th
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Minister for Education and Skills t
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legislation provides that arrears o
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Recommendations: 13.5.1 In summary,
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14.1 Recommendations 14. Recommenda
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25. Financial performance indicator
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Housing 48. Housing sections within
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Planning monitoring by other public
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Local Government and the Wider Publ
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that just because these recommendat
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Appendix 1 - List of Submissions Re
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Appendix 2 - Local Government Effic
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Gross Current Income by Source and
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County Councils Housing and Buildin
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Town Councils Housing and Building
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Non-Rating Town Councils (1) Paymen
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Regional Assembly Payments Receipts
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Local Authority Current Expenditure
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Town Council Population Size (Censu
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Appendix 5 - Local Government Net B
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Former Town Commissioners 2010 Net
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Appendix 7 - Performance Indicators
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Appendix 9 - Unaccounted for Water
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Appendix 11 - Membership of County
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Report of the Local Government Efficiency Review Group

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