Council agrees to set up joint venture with NHS to save money

Herefordshire Council has agreed proposals to create a new joint venture to share and run key corporate functions with NHS Herefordshire and Hereford Hospitals NHS Trust. The move, which could realise savings of up to £5.4 million a year, was approved by the council’s cabinet today (18 March 2010) but has also to be agreed by the boards of the primary care trust and the county hospital. Money saved will be invested in protecting essential public services for the most vulnerable members of the community.

The joint venture would be a public services partnership between the three organisations; planning, purchasing and providing central functions more efficiently.

Herefordshire’s unique approach to public services partnership, which is increasingly being seen as a model for other local authorities and trusts in the UK, means that many corporate functions and costs can be shared. The aim is to avoid the scale of cuts in public services seen in other parts of the country by sharing functions and reinvesting the savings in essential health and social care services. The benefit for local people is that public services would be more joined up, be of higher quality and able to focus better on customer needs, while maintaining a strong Herefordshire identity.

Proposals originally included three models. These were for the three organisations to either set up their own joint venture, or outsource many corporate functions to the private sector, or for one of the three organisations to provide the services for the other two. The joint venture model has been recommended as the way forward.
 
The first set of corporate functions under consideration to be shared in the joint venture is likely to be human resources, payroll and expenses, finance, purchasing and legal services). Many other central services are already being shared across Herefordshire Council and NHS Herefordshire, including information technology, communications and emergency planning, and other areas in scope to share across the three bodies include internal audit, transport and estates.

The move is prompted by the need to protect services to the most vulnerable members of the community, including Herefordshire ageing population, disabled people and children looked after by the local authority. Local government and health will also focus on how together they can manage contracts, purchase goods and services and achieve further economies of scale across the three organisations.