Recently, the Cabinet Office estimated that savings of between 20% and 40% can be secured when resources are pooled in this way, but it is not just about money, it also helps smaller organisations pool expertise, and can help establish centres of excellence improving service delivery. For Local Authorities, the delivery of health and social care integration has this principle at its heart and the Scottish Government's Hub Infrastructure programme lends itself to joint procurement, and occupation, of facilities to achieve that policy aim. It is also worth pointing out that the Procurement Reform (Scotland) Act of 2014 requires authorities to have a procurement strategy in place and publically available. That Act also makes provision for authorities to create joint strategies and this again highlights the policy drive for further collaboration.
With all that in mind, it is therefore important that there is a legal framework in place that accommodates these objectives and does not force public authorities into an expensive procurement exercise when all they are seeking to do is to either work collaboratively or to ring-fence risk in their own service provision. We had a lively discussion and the main themes that emerged were as follows:
Was discussed at length and in particular the "Teckal" exemption which has now been codified in Article 12 of the Public Sector Procurement Directive. Briefly, once in force, authorities will be able to use Article 12 to award contracts without going through a procurement process if certain tests can be satisfied, including that the authority exercises a level of control over the body which is similar to that which it extends over its own departments, there is no direct private capital participation in the entity, and it carries out more than 80% of its activities for the authority or other entities controlled by it (the control and function tests). The tests, broadly speaking, codify existing case law.
Tailoring the structure to ensure compliance with both the Teckal Rules and the governance arrangements of the Teckal body was seen as crucial to the process.
The relevant local authority powers and duties should be considered at the outset of a proposed shared services project. Should Local Authorities consider using the Power to Advance Well-Being in more cases to allow it to drive innovation, improvements to service delivery and ultimately savings? By and large this power is used sparingly and provides Local Authorities with the discretionary power to do anything which it considers is likely to promote or improve the well-being of its area and persons within it (albeit with certain limitations).