This month ‘best value’ becomes compulsory for the management and procurement of local government services. Already this new philosophy is promising to take facilities management higher up the town hall agenda.

There is nothing, it seems, politicians like more than every once in a while shaking up local authority service provision. This month the government’s ‘best value’ concept is replacing open-market compulsory competitive tendering by local authorities.

Out goes the theory that the private sector is generally the better provider of a set of prescriptive, ring-fenced services, which included catering, waste management, maintenance and cleaning, and where the ultimate cost was the deciding factor in awarding a contract. In comes a new, supposedly more flexible regime, which sets the focus on getting value for money.

Under best value, authorities are to be given free rein, to a point, to examine whatever services they like and decide on the best way to provide them, whether via an in-house team or private contractor.

Although for most it is still early days, favourable reactions to best value are filtering through from a number of official pilot schemes and, crucially, a handful of pioneering councils that have implemented best value initiatives long before being required to do so by law.

Initial predictions are that the scope and status of facilities management within local government will be considerably enhanced as a result of best value.

The term facilities management is less widely used in local government than other parts of the public sector, such as the National Health Service. A study in 1998 by Sheffield Hallam University (SHU) revealed that 74 per cent of executive teams in NHS trusts have a facilities manager, either on the board or reporting to a board director.

By taking cost away from the heart of a contract, best value places a greater degree of importance on factors such as customer satisfaction and service delivery standards.

Unpublished research by the university shows that just 29 per cent of local authorities treat the function that seriously. While the NHS took an integrated approach to the practice of facilities management by packaging services together, local authorities tended to approach services individually. But Professor If Price, co-director of the facilities management graduate centre at SHU, predicts a sea-change in the provision of local authority services as a result of best value.

‘The indications from our research in the last year are that strategic facilities management is bound to have a growing role in local government. The best value agenda is going to bring the role of property and facilities to the fore and could encourage better ways of organising and managing contracts,’ says Price, who believes that local government is roughly four years behind the NHS in adopting the best in facilities management practices.

‘There will be more integration of property management and facilities management than in some other sectors simply because local authorities own so much property,’ he adds.

By taking cost away from the heart of a contract, best value places a greater degree of importance on factors such as customer satisfaction and service delivery standards. This shift in emphasis will, according to Price and others, encourage local government to apply the facilities management lessons learned in other areas of the public sector.

We will see, predicts Price, better use of property assets, the introduction of helpdesks, call centres and one stop shops, and different forms of working practices.

‘All services and larger chunks of those services will be up for challenge and comparison under best value. There will be no room for complacency,’ says Price.

Challenge, compare and consult – this is the new mantra by which local authorities will operate.

Challenge, compare and consult – this is the new mantra by which local authorities will operate. Although consulting with end users of a service presents its own difficulties, most of those who have already started working on best value have reported that the greatest hurdle to jump is the requirement to compare.

Bernard Williams, director of benchmarking specialist and independent facilities consultancy BWA, advises that the switch from a cost to a quality focus means there is a greater need for performance measurements: ‘Authorities have got to think more strategically about what they want and how they want it,’ says Williams. ‘But this will bring facilities management to the attention of top management in a way that they can understand it. There is a growing realisation of the relationship between service levels and the efficiency of an organisation.’

According to the organisation set up by local government to advise on best practice within the sector, known as the Improvement and Development Agency, local authorities are good at benchmarking among themselves but not so much against the private sector as there has been a degree of caution from both sides when it comes to sharing data.

Williams’ colleague at BWA, Michael Packham, was the man who helped develop performance indicators currently being used by Kent County Council in its best value reviews. He believes the difficulty facing authorities such as Kent and Hertfordshire County Council, which are making the running with best value, is that there is a lack of candidates for them to compare themselves to.

‘Benchmarking is a way of assessing how well you are doing in the context of other service providers. Unless you can measure how well you are doing, how can you possibly say if you are achieving best value,’ asks Packham. ‘You may be spending £9 per square metre on getting all your carpets cleaned every year but does that get them cleaned every night or every week?’

The going will be slow at first. With only a handful of councils leading the way, there is little practical evidence for other authorities of the best ways in which best value can work. However, the majority of those already involved in best value initiatives, both within local authorities and the private sector, predict great opportunities for developing facilities management within the sector.

Clive Groom, chief executive of major public sector facilities management contractor Building & Property Group, welcomes the flexibility of the new regime and its emphasis on innovation: ‘Clients were forced to tender before but under best value we should see far more councils going into it because they want to and because they have the flexibility to set their priorities and structure bids accordingly.

What is ‘best value’? Best value was introduced by the Local Government Act 1999 to replace compulsory competitive tendering, and lies at the heart of the government’s aim to improve services and hold councils accountable to local people or the results they achieve. Under the initiative, councils will review why they are providing services and who is best placed to deliver them. Best value was scheduled to become compulsory on 1 April. Best value reviews will be required ‘to consider the role of competition as a means of securing efficient and effective services’. Options for future delivery of services include: * the cessation of the service in whole or part * the transfer of services to another provider * the joint commissioning or delivery of the service (with no in-house bid) * the creation of a public-private partnership * the market-testing of all or part of the service * the restructuring of the in-house service or the reorganisation of an existing contract Local government minister Hilary Armstrong believes effective best value will require a cultural change in councils, not just a mechanistic shift. ‘Modernisation’ is her key word. She talks of getting away from the CCT-induced mentality of only doing what the regulations allow and achieving constant self-generated innovation. ‘Clearly there are central guidelines beyond which councils can’t go, but I don’t think councils appreciate the freedom they have,’ she says.

Case study: Hertfordshire County Council Phil Roberts, head of strategic facilities management at Hertfordshire County Council, believes that best value has provided the opportunity for councils to approach service delivery in radically new ways. At Herts, the opportunities presented by best value have brought about an innovative approach to opening lines of communication between service users and service providers. Under an existing project, Herts Connect, the council and other public service providers in the area examined how services were operated and the way this related to service users. The common departmental approach to organising workforces and services was found to prohibit easy contact and access and the decision was made to introducing a single point of contact. In partnership with facilities management giant Capita, Herts will be running the first stages of a call centre to handle enquiries from service users. ‘Users do not need to worry about who runs what, they just want to speak to someone. It is very early days yet but we think there is great potential in this approach,’ says Roberts. Another project looked at bringing all the council’s office resources under one managerial roof and extending the ‘workwise’ programme of alternative working patterns, to allow council staff (the end users of the council’s substantial office stock) to use office space as it suited them rather than forcing them to return to a particular building to do their office work.

Case study: Kent County Council Alan Phelps, head of the property policy unit at Kent, has recently completed a best value review of the council’s property function. The review has resulted in a decision to examine the potential for making the council’s role more strategic by focussing on liaison, procurement and strategy. Delivery of the property services, in the short term at least, could be broken down into four or five components. Project work, building surveying and maintenance, facilities management services and environmental services, could then either be packaged together or run individually. The unit is also considering transferring its property assets to a contractor. ‘Best value has meant more work but it prompts you to take more initiative. You can’t just keep going with the accepted orthodoxy. It makes you think,’ says Phelps.

Source

The Facilities Business