Purpose

The purpose of this document is to provide the public with more information on Kent County Council’s (“KCC”)approach to selecting its preferred option for the delivery of Kent’s Libraries, Registration and Archivesservice(“LRA service”).

Objectives

As outlined in the consultation document and set out in more detail in this Appraisal, in order to maintain the positive impact the LRA service has on residents’ lives and to continue to improve services, we must look at changing the way we deliver services.Due to the growing gap between demand for these services and resources available, KCC has considered alternative governance models as the current delivery model is not considered financially sustainable.

The most important objective of KCC’s transformation process is to ensure that these important customer facing services can be delivered in an effective and sustainable manner. As part of this, KCC seeks a service delivery model for the LRA service which:

  • enables KCC to continue to meet its statutory obligations in relation to the LRA service;
  • ensures the LRA servicecontinues to play a key role in local communities, with a strong community ethos and local communities being meaningfullyengaged with service delivery; and
  • delivers a customer-focused service efficiently and effectively whilst contributing to the delivery of the required savings as part of the Facing the Challenge Transformation Programme (please see the glossary in appendix B).

How we Developedthe Preferred Option

The LRA service was reviewed through a service review and market engagement exercise which appraised alternative models of service delivery as well as investigating opportunities for in house service change.

As part of the review, representatives of KCC have talked to library service providers and a number of other library authorities across the country. This was to gain an understanding of how others are responding to financial pressures in the current economic climate, and how library authorities are changing their services as a result of changing demographics and the expansion of new technologies (please see appendix A fora list of local authorities approached).

We have used a wide range of methods in our research including workshops and face to face meetings with other local authorities, desktop research into the national landscape for library, archives and registration-related services and soft market testing discussions with external providers.

Through this engagement exercise we have been told by a number of organisations that:

  • Increased community involvement and staff morale, overall service improvement and the realisation of savings aresome of the potential benefits of transferring the LRA service to a new delivery vehicle that operates outside KCC; and
  • Someauthorities that have transferred their service provision to an alternative model have been able both to retain their library network and to deliver savings.

A number of options were considered through the review of the LRA service and these were presented alongside other available options, at the County Council meeting on the 15 May 2014 with the aim of endorsing the preferred option for the LRA service.

The key outcome of the service review was that the creation of a charitable Trust presents the most favourable option, offering the broadest range of benefits to our customers, to local communities and to KCC.

Additionally, the Trust option was presented to Cabinet Committee on the 16Septemberto be endorsed as the preferred option to take forward to consultation.

An Equalities Impact Assessment has been developed and is available online. This document considers the impact of the programme on all communities. It is a live document, and will be updated as required.

The next steps are the consultation process (as set out in the Consultation Document) and detailed consideration of the responses to the consultation.KCC has engaged Lake Market Research to carry out an independent analysis of the responses to the consultation. Lake Market Research will prepare a report which will be analysed and KCC will take this into account as part of the decision process on the future of the LRA service.

Outline Options AppraisalMethodology

Through the review of the LRA service, a variety of operating models were explored, with a total of six delivery options being considered as potentially viable and worth exploring further.

Building on the outcomes of the local authority engagement exercise, soft market testing and internal stakeholder engagement, the options appraisal included the following steps:

  • Identification of internal stakeholders’ key priorities and requirements for the LRA service;
  • Establishment of evaluation criteria agreed by the internal stakeholders against which options were assessed;
  • An evaluation of how well the different operating models delivered against the chosen criteria; and
  • A summary of key risks and issues potentially affecting each of the proposed options.

The table below outlines the evaluation criteria which were agreed by the internal stakeholders:

Criterion / Description
1 / The option enables the service to respond to the future needs and demands of its customers.
2 / The option enables KCC to maintain influence over the delivery of the service and the ability to adapt to changing priorities.
3 / The option helps KCC in moving towards an active commissioning authority.
4 / The option supports KCC in meeting its financial challenges andgenerates opportunities to reduce public subsidy.

Outline Options Considered

Six options were considered for appraisal, these were as follows:

Option 1 - Retain Service In-House but Transform Further

Option 2 - Commissioned Model through Outsourced Provisio

Option 3 - Partnership/Joint Venture (JV) with External Provider

Option 4a - Partnership/JV with Public Sector Partner – Library Authority

Option 4b - Partnership/JV with Public Sector Partner – Non-Library Authority

Option 5 - Establish a Standalone Kent Trust

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Options Benefits and Risks

Option / Key Benefits / Key Risks & Issues
Option 1 – Retain Service In-house but Transform Further / No set up costs
Guaranteed county council control
Ability to extend existingTransformation Programme / Potential for significant savings restricted
Income generation restricted
May not lead to radical transformation
Option 2 – Commissioned Model through Outsourced Provision / Ability to tap into supplier’s expertise to deliver an improved service
Savings can be underwritten in contract
An established model for library services
Increased purchasing power, shared systems and intellectual property / Lack of experience by supplier in delivering Registration Services
Provider may lack infrastructure capacity to deliver to the size of Kent
Risk that cost efficiencies are not fully realised for Kent
Phased implementation may be requiredawaiting advice from General Register Office(“GRO”) about Registration Services
Option 3 – Partnership/JV with External Provider / Ability to tap into Partner’s expertise to deliver improved service
Shared risk and responsibility for delivering service
Increased purchasing power, shared systems and intellectual property / Relationship with Partner is untested
Lack of experience by supplier in delivering Registration Services
Provider may lack infrastructure capacity to deliver to the size of Kent. Any new income or savings would be shared and risk that cost efficiencies are not fully realised for Kent
Potential for conflicting approachbetween partners
Phased implementation may be required subject to advice fromGRO about Registration Services
Option 4a – Partnership/JV with Public Sector Partner (library authority) / Potential for shared approach to management
Increased purchasing power, shared systems and intellectual property
Ability to tap into Partner’s expertise / Savings delivered may be minimal
Potential for differing approaches by different partners
No market response so no evidence can be delivered
Option 4b – Partnership/JV with Public Sector Partner (non-library authority) / Potential for shared approach to management
Increased purchasing power, shared systems and intellectual property
Ability to tap into Partner’s expertise / Savings delivered may be minimal
Potential differing approaches by different partners
No market response so no evidence can be delivered
Option 5 – Establish a Standalone Kent Trust / Guarantees community involvement
Increased ability to generate income
Most flexible model
Potential to transform services further with involvement of local communities / Existing models of operation for standalone library/archive Trusts still in their relative infancy
Lack of internal experience in setting up a Trust may delay or compromise the success of the Trust model
Phased implementation may be required subject to advice from GRO about Registration Services

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Selection of Preferred Option

As a result of the original options appraisal, the options were ranked as follows:

Option No / Description / Ranking
1 / Retain service In-House but Transform Further / 3
2 / Commissioned Model Through Outsourced Provision / 4
3 / Partnership/JV with External Provider / 2
4a / Partnership/JV with Public Sector Partner – Library Authority / 5*
4b / Partnership/JV with Public Sector Partner – Non-Library Authority / 5*
5 / Establish a Standalone Kent Trust / 1

*These options are not considered capable of achieving KCC’s objectives and therefore have not been included in the consultation document.

Further work carried out since the original options appraisal has reinforced this ranking and it is still consideredthat on balance the Trust model has a more desirable range of net benefits for the Kent area and its communities as a result of its extended opportunities and flexibility, with the highest likelihood of increasing community engagement in the delivery of the services and ensuring the longer term viability of the services.

Overall, whilst other options are considered as less beneficial,recognising that options 1, 2 and 3 remain legitimate options they are included within the consultation.

Potential Phased Implementation

Under current UK law, registration services must be delivered via a Local Government approved scheme, and because of this, we are working with the statutory regulator to understand what the timeline could be for delivering KCC’s registration services under this new model. It may be that moving registration services into a charitable trust will take longer than moving across library and archive services.

KCC’s preferred option is to deliver the LRA service through one charitable Trust. We stronglybelieve that the Trust model offers the greatest benefit for these services into the future, and therefore, if necessary, we will consider taking a phased approach to the delivery of this proposal:

  • Phase one: Create a charitable Trust to deliver library and archive services
  • Phase two: Move registration services across to the charitable Trust

Whether the LRA service moves across to the charitable Trust at the same time or whether we take the phased approach outlined above, our customers will still be able to register births and deaths in our libraries.

Key Features of the Preferred Option

Based on the outcomes of the options appraisal process, we consider that the Trust model has the greatest range of benefits in comparison to the other options explored.

The following features are seen as integral to the Trust model:

  • It is envisaged that the move to the Trust model would still see the delivery of the full range of the LRA service;
  • The Trust would enable increased community involvement together with freedom and flexibility in much of the decision-making process and the ability to react faster to changing market forces;
  • The Trust would be established with charitable objects and it is anticipated will apply for charitable status as soon as possible. The majority of the Trustees would be recruited from the local community. There will be a specification and concession contract agreed between KCC and the Trust to ensure that the outcomes KCC expects the Trust to deliver are made very clear and performance measures are in place. Furthermore, there will be regular contract monitoring. This is the standard best practice approach to ensuring that the Trust delivers what is needed and held to account;
  • The Trust would be required to obtain KCC’sconsent in relation to proposed material changes to the service; and
  • The Trust would free up the service from certain local authority restrictions, and enable access to alternative sources of funding not open to KCC.

Financial Comments

Throughout the development of the options appraisal, a key driver alongside the objective to maintain an important community servicewas the recognition that KCC as a local authority will need to make significant financial savings in the short to medium term.

As part of the Medium Term Financial Plan, the LRA service needs to make savings in the region of £3.275m over the next three years with£1.325m to be delivered prior to transfer through service redesign with no reduction in service levels, and a further £1.950m allocated against the proposed Trust model.

Current budget / Planned savings for the next three years
Net
(£m) / 2015/16
(£m) / 2016/17
(£m) / 2017/18
(£m)
LRA Service / 13.3 / 1.425 / 0.625 / 1.225

Whatever option is chosen following consultation, KCC will need to make these savings. Additionally, KCC cannot be sure that the resources foreseen now will be the same in the future, therefore an important factor in the financial analysis was the sustainability of the new delivery model to adapt in the future in line with the changing needs of our communities whilst maintaining the same range of services.

The LRA service has already successfully made a number of bold changes over the last six years, which resulted in the delivery of approximately £6million of savings to KCC. The review of the service suggests that there are no easy efficiencies that can be easily obtained in-house and that a more radical consideration of how the services are delivered is required in order to meet our financial challenges.

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AppendixA– Models Operated by other Local Authorities

Local Authority / Model
Suffolk / Trust model (Registered Society/Industrial Provident Society)
York City Council / Trust model (Employee-led Registered Society )
Wigan / Trust model (Company Limited by Guarantee)
Wandsworth / Outsourced delivery
Ealing & Harrow / Outsourced delivery
Croydon / Outsourced delivery
Greenwich / Outsourced delivery
Slough / Outsourced delivery
Cambridgeshire / In-house provision
Lancashire / In-house provision
Lincolnshire / In-house provision
Devon / In-house provision
Leicestershire / In-house provision with plans to transition to some elements of Community Led Model
Dorset / Partly in-house with some elements of Community-led Model
Essex / Partly in-house with some elements of Community-led Model
Hampshire / Partly in-house with some elements of Community-led Model
Warwickshire / Partly in-house with some elements of Community-led Model
North Yorkshire / Partly in-house with some elements of Community-led Model
Surrey / Partly in-house with some elements of Community-led Model
Bradford / Partly in-house with some elements of Community-led Model
Buckinghamshire / Partly in-house with some elements of Community-led Model

Appendix B- Glossary

Term / Explanation
Concession Contract / A concession contract is a public contract under which some or all of the income received by the contractor (often called the concessionaire), is third party income which is achievable because of a right to exploit the service (or services) to be provided under the contract
Facing the Challenge / The Facing the Challenge programme was introduced in September 2013 and is the Council’s response to meeting its financial challenges through a transformative approach through:
  • focussing on commissioning outcomes
  • redesigning services round the needs of customers and the outcomes we want to achieve
  • embed a focus on early intervention to better manage future demand
  • Integrating services and functions around clients groups to improve the customer experience.
The LRA service was within scope for Phase 1.
GRO / The General Register Office. The General Register Office is part of Her Majesty's Passport Office and oversees civil registration in England and Wales
LRA / Libraries, Registration and Archives service
The Council / Refers to Kent County Council
The Trust / Refers to the proposed service delivery model for the future LRA service. It is used in this document to mean a company limited by guarantee with wholly charitable objects and which will therefore be registered with the Charity Commission. Sometimes the term is used to include a charitable registered society or a philanthropic body without charitable status.

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