The property prize

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Better use and sharing of public buildings can help to generate huge savings. But it requires a breaking down of barriers and the putting aside of mistrust and fears over sovereignty

At the launch of a new report on how better to use the £370bn of public buildings, Communities Secretary Eric Pickles said the preceding inquiry had transformed a potentially dry discussion into a vibrant debate among authorities seeking to cut costs.

In my role on the steering committee of the Leaner and Greener II inquiry, which produced the report, I was privileged to see authorities actively embracing this debate. There is the example in the East of England where the  police service shares space with the library service; in Scotland, the council that shares its office with the courts, police, fire, prosecution service and health board; or the public bodies in England that have co-located benefits services with Jobcentre Plus and business links with youth activities.

During the inquiry, cases like this helped us in our arguments for a fundamental change in the model for managing the most prized public sector assets. The prize could involve the releasing of billions of pounds, and better matching of services to buildings.

Indeed, Leaner and Greener II is of great interest because it sets out routes for local public bodies to save money while actually improving public access to services, by pooling assets and matching service demands. The prize at stake is not simply savings but service transformation.

However, while the big prize may come from reducing bills on costly buildings and additional reduction in carbon, there are also potential savings from property contracts and management teams. Clusters of authorities, for example in South East Scotland, London, the East of England and North West, are generating quick benefits by merging internal teams under a single management structure, aggregating and procuring new contracts and cooperating on energy purchasing and management.

The vast savings from reducing floor space and delivering more accessible joined-up services to the customer take longer to deliver.  It requires a change in governance and a unified approach to planning the estate in the locality.

However, through our work on advising clients and the inquiry, I can point to some main tips for success.  This involves articulating clearly at the outset the size of the prize and ensuring participants are fully involved in identifying opportunities themselves; getting the membership right on a local joint property board; focusing on early wins and ‘business as usual’, (that is, supporting individual organisations’ business priorities); building a pipeline of opportunities through a programme of local property reviews; and considering setting up a local property vehicle.

The big savings prizes are unlikely to be achieved overnight because, it is fair to say, diluting control over buildings is not in most organisations’ DNA. Practically, it means people from many separate public bodies putting aside mistrust, sovereignty fears and other ‘barriers’,  to work on sharing buildings and joining up services for the collective good.

However, looking again at our buildings, which provide the meeting places, books, clinical equipment, ambulance and police services, sports facilities and classrooms used by our communities and the staff, is the first step towards vibrant debate, innovative solutions and ultimately improvements to services.

Guy Brett is director of real estate at Ernst & Young

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