CENTRAL SERVICES
Page 50
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Local authority central services such as treasurers' departments are now employing "real accountants" instead of the local authority CIPFA-trained "bookkeepers" of old, who were fine for balancing budgets but who struggled with the true profit-and-loss accounts and balance sheets that are now required. Return on capital employed or return on turnover are common measures currently used to assess performance. Accounting and full allocation of costs are now comparable with the private sector, with no possibilities of a hidden subsidy. The old chestnut of one service subsidising another, or costs being transferred and lost elsewhere, was not only possible in councils: many own-account operations probably do not bear their total real costs of their existence either.
District councils are vulnerable to losing their workshops work because the bulk of their throughput comprises refuse vehicles. If in-house refuse operations are not viable and are lost under competitive tendering, then the workshops are unlikely to have enough work left to be viable either, and will probably be lost too. Authorities should be operating their refuse services in exactly the style of the private contractors. There has been enough time to study the operations that have already gone private, the work schedules, working hours and spare vehicles. If an authority is still using "job and finish" it is probably uncompetitive. The private sector will submit a tender based on 39 hours' productive work-out, not 30 or 32. This productivity gain will win it the contract and provide a saving on the current inhouse costs. All local authorities should be feverishly studying the competition and learning, esecially from those which already have private-sector contracts.