Councils urged to embrace power of insourcing

30 May 19

Local authorities increasingly are and should look to bring service delivery back in-house, a membership organisation has said.

At a time of reduced central government grants and increasing demand for local services, the Association for Public Service Excellence said insourcing must be “robustly considered”.

Research by APSE, released yesterday, found that there is a growing trend of insourcing in UK local authorities, with 73% of survey respondents suggesting they were in the process of insourcing a service and 45% having already done so.

The survey – which received responses from 208 councils – found that austerity, a need for efficiencies and improved quality of services were the main reasons for this.

Speaking at the launch of the report, Rebuilding capacity: the case for insourcing public contracts, APSE chief executive Paul O’Brien said: “The old way of outsourcing has come under huge threat because of permanent austerity – but the public still expects the same standards.”

He noted that social care was “squeezing the life out of other services”, with greater proportions of local authority budgets going towards providing this service.

APSE’s analysis found that the most common type of contracts to be brought back in house were building maintenance (27% of contracts brought back in house), waste collection (21%), grounds maintenance (18%) and building cleaning (13%).

Also speaking at the event, head of communications and coordination at APSE Mo Baines suggested that: “The longer an outsourced contract goes on, the more a council’s ability to performance manage goes down.”

However, bringing services back in-house can allow local authorities greater control and flexibility to react to public policy changes, she added.

“Insourcing is a viable delivery option and should be robustly considered,” she said.

Baines highlighted a recommendation from APSE’s research to ensure all councils have a rolling calendar for reviewing contracts in advance of their end dates, so that insourcing could be considered.

Richard Watts, leader of Islington Council, provided examples of the effectiveness of insourcing services.

He noted that his council had insourced multiple services in the last eight years – a move which is saving £380m each year. Examples of services insourced included building services, education services, housing management and building repairs.

“Insourcing is now a mainstream conversation in local government, but a few years ago it was not,” he said.

Read PF’s in-depth analysis of the slow down in local government outsourcing.

Did you enjoy this article?