Thursday, 4 November 2004

Questions (204)

Paul McGrath


201 Mr. P. McGrath asked the Minister for the Environment, Heritage and Local Government the steps he intends to take to provide better value for money in local government. [27600/04]

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Written answers (Question to Minister for the Environment, Heritage and Local Government)

While local authorities have primary responsibility for delivering value for money in their activities, my Department is actively involved on a range of fronts to ensure that this is achieved. Key initiatives by my Department include: full implementation in 2004, in co-operation with local authorities, of new financial management systems based on accrual accounting principles and incorporating balance sheets, which is designed to deliver better management information, enhanced performance management capacity and to facilitate improved value for money measurement. The introduction of five-year multi-annual capital investment programmes which provide a structured basis for the planning and delivery of all capital programmes, in a way that ensures that best value for money is achieved.

In the housing area, to maximise the benefits of this multi-annual approach, local authorities have been requested to prepare five-year social and affordable housing action plans for the period 2004-08. This plan-led approach will focus on achieving maximum output under the programmes and ensure that this output is delivered in a coherent, integrated and sustainable manner. In the area of water services, in order to deliver infrastructure more speedily and to improve operation and maintenance standards, my Department has adopted design, build and operate as the standard form of procurement for all new treatment facilities to be provided by local authorities. Public private partnerships are also being used in the areas of waste management and housing.

The first phase — demonstration and capacity building — of the local government e-procurement strategy which was adopted by my Department in 2003 is under way. The strategy will generate value for money in the local government sector through better management of the procurement process including the sourcing of lower prices, lower transaction costs and improved control of inventories. The implementation of the change agenda recommended in a report on the management of the local authority fire service published in 2002 will facilitate the development of the fire and rescue service in a way which will deliver value for money through results and continuous improvement.

My Department has encouraged local authorities to apply value for money principles in an environmental context, chiefly through the development and implementation of environmental management systems such as the eco-management and audit scheme which aims to ensure best use of all resources that have an environmental impact for example in terms of energy conservation. The use of the needs and resources model in the allocation of general purpose grants from the local government fund encourages efficient use of resources by local authorities. The introduction of local authority performance measurement indicators across a range of services will foster increased emphasis on value for money in service delivery. Economy, efficiency and effectiveness in the local government system are key elements in the terms of reference of a major independent review on local government funding which was commissioned this year. The appointed consultants are due to report early next year.