Monday 18 August 2008

I come to praise the Council, not to bury it

Now I know what you must be wondering. Where’s he going with this? Where’s the rant or the obligatory moan about the leader of the council? Well sorry to disappoint, Dear Readers, but this blog entry contains no rant and no moan. Only praise, because praise is due. So much so, that I will put off until another time the article I had prepared about the flat screen TV bought for Chief Executive Leo Boland’s office at a cost of more than £3,000.

So what has me singing the council’s praises? Well, it is a Delegated Powers Report (DPR) issued by Margaret Martinus, Head of the Legal Department. This DPR authorises YVA, an external firm of solicitors, to carry out the legal work on up to 10 property cases.

It seems like an eternity since the Conservatives last talked about privatisation, but finally the good times are back! OK I know British Rail was a bit of a cock-up, but there were plenty of other privatisations which were successful.

The YVA contract is worth £10,000 which equates to £1,000 per case. Although the DPR does not specify the precise nature of the work to be undertaken, the charge does not seem to be unreasonable especially when, in some cases, the council should be able to recover the costs from other parties.

[Post Script. A member of the public posted a reply to this blog but it seems that a technical glitch has caused it to disappear! The writer pointed out that conveyancing work should not cost £1,000 a time and that £500 was more reasonable. Perhaps the council would like to comment on this?]

Clearly the council is just dipping its toes in the water to see if the experiment works, and that is fair enough. But there is no reason why it should fail, and if we really do have a proper Tory administration, then we can soon look forward to full scale privatisation.

The council currently has a legal department of 34 people, 23 of whom are solicitors. 13 staff are part time but this is still a very expensive department to run. Qualified solicitors do not earn peanuts - and nor should they! But it is a simple fact of life that the state is inherently inefficient and bureaucratic. By privatising the legal department, the council - and by definition the taxpayer - will benefit from:

  • Lower costs due to market competition for contracts
  • More efficient service
  • Lower rent charges due to less office space being required at North London Business Park
  • Reduced liabilities for future pension contributions
  • Negligence protection

What do I mean by that last one? Well, take the Underhill sale for example. If that transaction had been handled by an external firm of solicitors, the council would have a claim against that firm for negligence. But because the work was done in-house, the council can’t sue itself.

Existing legal staff need not fear. There is no reason why they could not set themselves up as an independent law firm competing for contracts in the marketplace. If they are good enough, they will have gainful employment. If not, well the taxpayer is relieved of a burden.

In these difficult economic times, there is a moral obligation on the council to deliver a better service at a lower cost. The council’s duty, first and foremost, is to the residents of this borough.

Privatisation is a very simple way to cut costs, eliminate waste and become more efficient. The legal department is only the starting block. Plenty of other departments could follow suit. This blue revolution is long overdue. Three cheers for Barnet Council!


Anonymous said...

If the council can save money by privatising some departments, do you think they will (a)reduce our council tax or (b) award themselves pay increases?

Don't Call Me Dave said...

Dear Anon

You are more cynical than me! I can’t speak for the council as to what they would do with any savings, but if they can improve services at a lower cost to the taxpayer, then perhaps the answer to your question is both?

David Cameron was going on recently about “sharing the proceeds of growth”. We haven’t heard it for a while, so perhaps he has quietly abandoned the idea. Most people (apart from Gordon Brown) now realise that throwing taxpayers money at a problem does not solve it. So if Barnet can make significant financial savings in one area, I hope they will resist the temptation to spend it somewhere else.

Instead, they should return it to us because it is our money. I don’t have a problem with the Chief Executive earning more if he can deliver better services for less. My objection is when chief officers and councillors award themselves inflation busting increases without a commensurate rise in their productivity.

Duncan Macdonald said...

I don't have a problem with the council privatising some departments if it can be demonstrated that an equal or better service can be delivered for less. The driver is of course competition. In the case of the legal department there would be competition. You can always sack your lawyer and get another one! In other cases where there is no market then I'm not convinced that it's a good idea.

Don't Call Me Dave said...

Duncan, I agree that not every council service is suitable for privatisation, but clearly many are. I hope that the full council will receive a comprehensive report of this trial in due course.