THERE are serious concerns the biggest shake-up of local government in Gloucestershire is “spiralling out of control”.

Established in 2017, Publica has provided a wide range of council services for Cotswold, Forest of Dean and West Oxfordshire district councils’.

This includes customer services and planning to back-office functions including IT and finance.

Services for the three councils were transferred to Publica by the then-Conservative administrations.

This company, which was fully owned by these authorities along with Cheltenham Borough Council, has been delivering public services for the councils since then.

While Cheltenham was a founding member and full shareholder of Publica they only have their ICT services within the company.

However, since last year the councils have been working towards taking back direct control of staff in a bid to provide better services and make savings in the long run.

Council chiefs say the Publica partnership has achieved the savings it was initially set up for.

Councillors are now concerned about sovereignty and control as well as its ability to deliver further savings in the future.

The CDC Conservative group has raised serious concerns that the cost of the Publica transition process is spiralling out of control.

(Image: CDC)

"Reckless endeavour" say Conservatives

"Let’s start with the cost of the withdrawal process”, Tory group leader Tom Stowe (C, Campden and Vale) said.

“When this first came to council last November there was a figure for the cost of transition included in the report of £200k, we said at the time this was clearly unrealistic for a project of this scale.

“By the budget meeting in February this had ballooned to £500k.

"We’ve now got some figures regarding projected redundancy costs with a provision for £300k.

“So, as it stands the cost of transition process stands at £800k.”

The Tories also question what future savings CDC can achieve from the move once the transition away from Publica is completed.

“The answer is beginning to emerge, there will be no savings, in fact, it’s projected to cost £356k more per year giving a cumulative budget impact by 2027/28 of £1.1million,” Cllr Stowe said.

“So, combining the withdrawal costs and the ongoing cumulative impact, the total cost of this process to CDC taxpayers is going to run into millions.

“Worryingly, this only includes the costs for phase one of the transition. Phase one is the ‘low hanging fruit’ those jobs which are easiest to transfer.

“Phase two and three are going to much more complex, and as it stands we have no idea what additional impact these are going to have.

“What we do know, as explained in this report, is that much of the cost savings are front loaded and already accounted for in the phase once calculations, so phone two and three and any further phases will not deliver comparative cost savings, this has the potential to spiral even further out of control.

“Given the perilous state of the council’s finances, which, as demonstrated by the recent budget out-turn report, are currently being propped up by an unexpected windfall in treasury management income caused by higher interest rates, without which the situation would be terminal, the financial impact and ongoing uncertainty are going to wreak havoc on this council’s finances.”

The Tories say that they have been steadfast in their position since they were first briefed on the council’s intention to withdraw from Publica.

They recognise the potential benefits regarding recruitment, operational agility and autonomy of council service delivery.

But say these benefits needed to be weighed up against the costs and value for money for the council tax-payers of the Cotswolds.

“We explained that there was not enough detailed information on the financials to be able to make a properly informed decision of this magnitude, in particular the costs of the withdrawal process itself and then the ongoing impact on the council’s budget going forward once the withdrawal had been completed.

“We said at the time that there should have been a standstill period to give officers at all partner councils an opportunity to draw-up detailed financial projections on the short- and long-term impact of these changes so a properly informed decision could be made.

“These pleas were ignored and the true costs of this project are starting to become apparent.

“Taxpayers were fortunate when after years of warnings, the administration’s disastrous recovery investment strategy was abandoned, however, it seems that they are not going to be so fortunate this time as the Publica transition seems destined to plough on at any cost.

“The overview and scrutiny committee also shared concerns and put forward a cross party friendly amendment to the proposals back in November, This amendment put a potential back-stop should the figures, once known, prove to not stack-up.

“This amendment was ignored by the leader. In this report, we’re now starting to see the reality of the true cost of this decision process.

“Some of the key reasons for this process were headlined as operational agility and autonomy of service delivery.

“The impact on the budget of this process is going to wipe out any opportunity for flexibility, their hands are going to be tied.

“This council is going to have vastly reduce its service provision and delivery, as with this huge black hole in their budget they’re not going to be able to afford to provide anything other than the bare minimum statutory services it has to provide.

“They can’t blame this on government cuts, the responsibility for this lies entirely with them, we warned them of the risks which they ignored, and it’s time for the Lib Dem leadership to come clean to the residents of the Cotswolds on the true impact of this reckless endeavour.”

The Liberal Democrat leadership at CDC has not responded to a request for comment.

But last month, West Oxfordshire District Council, Cotswold District Council and Forest of Dean District Council agreed to move forward with plans to take greater control of council services.

They approved proposals to return over 270 employees to direct council employment by the end of the year. The employees will be moved from Publica.

Six years after Publica was formed, an independent review was undertaken to look at whether the Publica model was still able to meet the current and future needs of its council owners.

It came against the backdrop of significant political changes in the councils, new council priorities and a changing local government landscape.

Two independent reports recommended that a significant number of ‘locally focused services’, such as planning, economic development and community support, should be directly delivered by the councils.

This would enable the councils to better tailor local services to their individual areas.

The changes would leave Publica delivering a smaller range of services for the councils such as IT, customer services and benefit payments.

The proposals considered by the councils in July are for a first phase of employee transfers with a second phase due in early 2025. The first phase includes over 270 employees.

Employees will be consulted in September before a proposed transfer in November.

Most of employees affected would be subject to what is known as a ‘TUPE transfer’ meaning their roles would transfer directly to the councils with protections to salaries and other employment benefits.

“Moving services into direct council control will give us more choice"

In a joint statement, the leaders from the councils said: “Every partnership must evolve to meet new challenges and now is the ideal time to make sure that as individual councils we are fit for the future.

“Our councils, and the backdrop of local government, have changed significantly over the past six years.

“To meet the current and future needs of our residents and businesses we need to take greater control of the local services we deliver, so each council can take an approach best suited to its communities.

“Moving services into direct council control will give us more choice and options on how we can find the most cost-effective way to maintain and improve the council services that people rely on.

“It will form part of wider plans to meet the challenge of significant budget reductions facing local government.

“We will still share some services within the Publica model meaning we will have services run locally for local communities which will be supported by an established shared services partnership to maximise efficiency.

“While this may mean a change for some staff, the vast majority will see their jobs transferred back to being under council employment. We will work hard to support staff through the transition.”