APSE urges Local Authorities to bring back in-house services

Date: 30th May 2019

Insourcing services are essential to future funding for council services, according to a report published this week by the Association for Public Service Excellence (APSE). simply get on and deliver a service under a simple direct employment model.

For many years the narrative of public service delivery has been dominated by big policy ideas of big government; often a narrative driven by the holy grail of high quality but cost-effective public services. By mimicking market mechanisms public services, it was assumed, could be delivered more effectively and more cheaply. What is now clear is that the over-simplification of public service delivery into commodified units, capable of being delivered by the market, has led to increasing market failure. 

This research therefore explores the growing phenomenon of ‘Insourcing’; bringing back ‘in-house’ the delivery of services. It takes a particular focus on UK local government services and questions the drivers for this increase in insourcing. It finds that insourcing is not a passive reaction to contract failures, but is increasingly viewed as a proactive response to the public policy pressures facing local councils, not least the ongoing impact of austerity.

The advisory body, which informs more than 250 local authorities across the UK on a broad range of frontline public services, argues that local councils “cannot make money from resources over which they have no control”. Insourcing, it believes, provides a means for councils to organise activities to support income generation and commercial activities.

The report says the scale and volume of insourcing in UK local government is supporting the idea that, rather than simply re-letting or extending contracts, insourcing as “an alternative model of delivery is not only viable but increasingly viewed as an innovative solution”.

It also establishes the ability for councils to be the "connecting force between local services and communities and businesses" and it joins up the endeavours of public services with sustainable local outcomes.

The report recommends that insourcing should be viewed as a form of innovation in both service delivery and resource allocation. It adds that decisions to insource "should not be driven by form but by what the local council wishes to achieve".

Including a comprehensive analysis of public policy as well as case study councils that have insourced services, this research report is a must read for those considering returning local authority service back to public control.

For more, see the report here.

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