The issues within shared service organisation LGSS have been highlighted at a meeting of all partner councils.
The lack of transparency within the organisation, the wide-scale issues it had with the rollout of a new £8m business system and the governance of a recruitment agency it set up were all questioned by councillors who met at Northamptonshire County Council’s One Angel Square headquarters yesterday (July 12).
The organisation, which manages £85m of services across partner councils Northamptonshire County Council, Cambridgeshire County Council and Milton Keynes Council, has come under fire recently.
It was heavily criticised by the government inspector Max Caller in his best value report of NCC, when he questioned the claimed savings of the organisation. NCC’s cabinet has also been ‘troubled’ by the value of money it is bringing to the county council.
Interim chief executive Sarah Homer, who is being paid £1,220 per day to lead the organisation, presented the summary of achievement reports for the year 2017-18 and said £7.2m of savings had been made through contract reviews.
But councillors were not too impressed with the overall performance of LGSS in recent months.
Conservative Cambridgeshire county councillor Chris Boden, who is one of nine councillors on the committee, said: “I am finding it hard to convince others in my authority that LGSS is important to support.”
Lib Dem Cambridgeshire county councillor Sebastian Kindersley also queried the openness of the organisation.
He said: “One of the issues that we have is the opaque nature of LGSS. A lot of the passive language has been used in reports. It says things like ’it has been agreed that’, etc. I would like to know who made the agreement.”
LGSS’s director of business services Mark Ashton presented a report to the meeting about the recruitment agency LGSS Opus, which was set up by the Cambridgeshire and Northamptonshire councils with Suffolk County Council.
He said the agency’s aim was to directly source staff to cut out add-on costs from other recruitment agencies. However, just 30 per cent of LGSS Opus appointments are made directly and the rest are sourced by the organisation’s 90-strong supplier network.
Northamptonshire County Council spent £11.1 m with the agency in the most recent financial year.
The meeting also heard about the problems that had been caused by the implementation of the new ERP gold system. The original 2017 date was delayed by one year and its introduction in April this year was beset by a series of problems with staff payroll issues and suppliers being paid late.
Head of HR at LGSS Martin Cox said: “It has been a rollercoaster like I have never experienced.”
Sarah Homer said: “It is absolutely regrettable. Not something we were happy with at all.
“Every invoice that is a backlog is somebody waiting to be paid and we are aware of that. Any situation that we hear about we address speedily.”
Chair of the meeting Milton Keynes Councillor Rob Middleton declared he was ‘trying to be a voice of positivity’ and thanked LGSS officers for the work they had done.
At the meeting it was resolved to ask auditor KPMG to do a best value inspection of the organisation. It was also decided that a change of names for LGSS Opus and LGSS Law would be considered to avoid confusion with LGSS.
A discussion about the future governance arrangements of LGSS was held in private with press and public excluded.
Local Democracy Reporter