Dáil Éireann Debate, Tuesday - 19 November 2013
485. Deputy Terence Flanagan asked the Minister for the Environment, Community and Local Government his views on the roll-out of shared services in local authorities and the savings that have been made over the past two years; and if he will make a statement on the matter. [49505/13]
View answerLocal authorities have identified total savings of €839m since 2008. In the period since the preparation of the Local Government Efficiency Report, from 2010 to end 2012, the savings achieved are reported at €561m.
Shared services have been identified in the Local Government Efficiency Review and the Public Service Reform Plan as an important opportunity to make further savings in administrative costs, while streamlining and improving service delivery without impacting on front line services.
To drive the reform agenda, and in particular shared service initiatives, in the local government sector, a dedicated Programme Management Office (PMO) has been established which reports to a high-level Oversight Group.
Overall, 32 operational areas are being examined for potential as a shared service or other collaborative approach that may provide efficiencies. The PMO has adopted a comprehensive methodology for the development and evaluation of projects including, gathering and analysing baseline data, business case preparation and peer review of business cases.
Treasury Management, Payroll/Superannuation and Procurement have been prioritised in the shared services programme in the short to medium term. It is estimated that annual savings of the order of €5.6 million could be achieved (excluding procurement) from these projects; the figures for savings in individual areas are subject to on-going validation as individual projects progress.
It is necessary to invest in these projects in the initial phase and returns accrue over time. The business cases are based on evaluation over the medium term with returns generally beginning to accrue after the shared service is operational for a number of years.
Following competitive bidding processes this year, Laois County Council was selected to provide Shared Payroll and Superannuation services on behalf of all local authorities while Cork County Council are the lead local authority for Treasury Management.
In relation to procurement, the project is being led and co-ordinated by Kerry County Council as the lead authority in the Local Authority National Procurement Office. Since 2010, local authorities have reported procurement efficiency savings of €109 million, exceeding the sector’s 2010 target of €70m by 55%. The local authority sector is working with the Chief Procurement Officer in the Department of Public Expenditure and Reform and, in this regard, further savings of €58.5 million have been targeted for the sector by 2016.
Further savings can be anticipated in the medium term as other shared services projects progress towards implementation.
