London shared service plan, Birmingham pensions deficit, corporate services spending, land joint venture…
0Westminster approves shared corporate services plan
Westminster City Council’s cabinet this week approved plans to create a shared corporate services function with neighbouring boroughs Kensington & Chelsea and Hammersmith & Fulham. The councils, which have already merged their finance functions, hope to save £2.5 million a year by 2015/16 in addition to “significant future savings”. The plans, subject to approval from the two other councils, will be developed by Hammersmith & Fulham director of finance and corporate services Jane West. They will see the merger of human resources, procurement, legal services plus revenues and benefits services.
Birmingham attempts to fill pension fund deficit
Birmingham City Council has agreed plans to spend £88.5 million over the next four years to start plugging its share of a massive deficit in the West Midlands Pension Fund. The council has cited lower than expected investment returns in the current economic climate as the major factor which has led to the deficit, understood to be the biggest in the UK. A report by officers said: The council has provisionally agreed a payment profile with the West Midlands Pension Fund for the next three years (2014/2017) based on progressive increases, the continuation of which would lead to full deficit recovery over the next 22 years.” It also said that the council is discussing an asset-backed arrangement with the fund.
Spending on corporate services falls
Overall spending on corporate and democratic management by English councils reduced by 13 per cent from 2003/04 to 2012/13, according to a report by the Audit Commission. The reduction was largely the result of a 21 per cent (£299 million) real-terms reduction in spending on CDC running expenses, the report said. CDC employee costs rose by 20 per cent (£72 million) in real terms over the period. The commission said that if higher spending councils reduced expenditure to the average for their council type, a saving of £290 million would have been achieved. Audit Commission chairman Jeremy Newman questioned whether councils were recording figures for CDC spending consistently.
Approval for property joint venture
Allerdale Borough Council has cleared plans to create a joint venture to develop council-owned sites. The council and property investor Lucent will each take a 50 per cent stake in the new venture, to which the council will transfer development sites in its ownership. Both parties will share profits, and the council estimates it will make £3.95 million from the first three sites.
Council pension fund in Glasgow Airport approach
A consortium including the Strathclyde Pension Fund has made a formal approach to buy Glasgow Airport. According to local reports, the bid will be led by Swiss-based private investment firm Partners Group, and could total around £500 million. Strathclyde Pension fund has assets of £13.5 billion currently invested on behalf of Glasgow City Council and Renfrewshire Council. An offer is likely to be made after the bidders examine the airport’s accounts.
Councils seek law firms for pension scheme arrangements
A group of councils have launched a tender for a framework to provide legal services for their Local Government Pension Scheme arrangements. The contract, worth up to £11.75 million, would see law firms advise on pensions and investment law. Norfolk County Council is running the tender on behalf of its partners – Buckinghamshire County Council, the Environment Agency, Dorset County Council, London Borough of Hackney, The City of Edinburgh Council/Lothian Pension Fund, Suffolk County Council and London Borough of Croydon.
Councils agree joint service plan
Dartford and Sevenoaks Councils have agreed plans to provide a joint environmental health service. The partnership, which goes live at the beginning of April, will save the councils a combined £1.7 million over five years. The new team will be based at Dartford’s Civic Centre, with a satellite office in Sevenoaks. The two councils have shared an environmental health manager since 2008 and also provide joint services in a number of other areas including revenues and benefits.
Council house solar panels installation plan agreed
Kirless Council has agreed plans to put solar panels on council houses, paid for out of its housing revenue account reserves. Installation is estimated at £4.6 million, with the scheme expected to pay for itself within 12 years, after which it will generate income for the council by selling surplus energy back to the national grid.
