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LocalGovernmentLawyer The Legal Department of the Future February 2016 23 One of the biggest management factors for local authorities in moving towards shared legal services is improving cost efficiency. The Governments current deficit reduction plan requiring public bodies to make significant savings until at least 201819 has given an added urgency and impetus for local authorities to consider their options in that regard. The Local Government Association currently estimates that there are 416 shared services across the country including shared IT systems fire services back-office and professional services and some front-line services which have achieved a 462m saving to date. In terms of local authority legal departments shared legal services can be very beneficial in drawing on existing expertise capacity and purchasing power and in some cases even creating profit by turning the shared services into a commercial venture. What are the potential advantages of shared services Reducing duplication and benefitting from cost savings through pooled resources knowledge and expertise which can be extremely useful where one local authority has particularly strong legal expertise in an area for example child care but less so in another for example planning. Increased efficiency and productivity by streamlining processes introducing common standards and making full use of capacity. Depending on the size and type of the shared service implementation costs may be kept fairly low. Ability to purchase legal services from other local authorities with the benefit of the partner authority having in-depth knowledge of the culture and workings of local authorities. Potential financial benefits in selling legal services in the event of spare capacity shared legal services are already being sold to other local authorities combined authorities arms-length management organisations charities and not-for- profit organizations blue light services housing associations and schools academy free and maintained. What are the potential disadvantages of shared legal services Viability of the model upfront cost procedures i.e. any procurement process required Solicitors Regulatory Authority SRA compliance if applicable and disruption cancelling out long-term savings. This will largely depend upon the size and type of the model chosen. Disconnect between legal teams and local authorities if they are not working exclusively and closely with their own authority. Conflict of interest between prioritising work for own authority versus partner local authority. Cultural fit and decision-making process issues. These issues need to be considered and streamlined so far as possible from inception. What are the delivery models for shared legal services Multi-authority collaborative arrangements may take a number of forms i.e. Partnership arrangements with other local authorities including sharing work allowing partner authority legal teams to retain independent status. Fully integrated shared services teams i.e. local authorities merging their own legal departments to create a shared legal service to be managed jointly or by a lead partner. This arrangement can be documented by way of a memorandum of understanding or other agreement setting out the parties respective responsibilities etc. Establishing a joint committee with representatives from all partners to which the service functions could be delegated under ss101 and 102 of the Local Government Act 1972. Joint procurement of external provider to deliver shared legal services to all of the authorities. This can be achieved through public sector partners or public and private sector partnerships. This external provider may be wholly owned by partner authorities or may be a private sector service provider. An important consideration in using an external provider is whether or not the scale of the proposed shared services The LexisPSL Local Government team explain the background to and advantages and disadvantages of shared legal services in achieving improved cost efficiency within the public sector. A short guide to shared legal services The Local Government Association currently estimates that there are 416 shared services across the country including shared IT systems fire services back-office and professional services and some front-line services which have achieved a 462m saving to date.