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Sizing Up

Local Government mergers and service integration

Sizing up

Background

This report outlines experiences from the recent Local Government Reorganisation (LGR) and previous merger and integration activity in the public and private sectors to identify lessons for any local authority considering integration or merger, and suggests an approach that authorities should follow to ensure that collaboration achieves real and additive benefits.

Key findings

Local public sector organisations have been tackling the challenge of growing demand, shrinking budgets, rising expectations within a changing policy framework by striving to improve the efficiency of their operations, and many have already undertaken numerous and extensive cost reduction activities.

However, the level of cuts to public spending announced as part of this year’s Comprehensive Spending Review has now changed the game again, and is causing local authorities to consider radical new approaches to deliver against these budgetary cuts. Therefore, it is unsurprising that several local authorities are taking a fresh look at ‘mergers’ and corporate restructuring activity.

Deloitte has extensive experience across central government, local government, and the private sector advising clients on how to get the most out of mergers and collaboration initiatives. Deloitte has supported many high profile recent corporate mergers: for example, budget airlines, UK retail banking and food manufacturing sectors. We understand what can go wrong, and the factors that are critical to success.

Deloitte can provide real practical insight into these issues, and should be offering to hold additional discussions with organisations focused on their approach, strategy and current initiatives across this increasing important area.

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