A local government legal department is offering its services to other councils across the country through a commercial ‘shared services exchange’, as part of plans to reduce running costs by 40% over the next five years.
North West Leicestershire District Council is the first legal department to join CapacityGRID, which allows local authorities to provide transactional services to each other regardless of location.
The venture, set up in 2011 by outsourcing company Liberata, has around 140 local authorities providing services such as payroll and pensions.
Elizabeth Warhurst (pictured), head of legal at North West Leicestershire, said the council’s legal department was selected to earn extra revenue as it has increased fee income by 16% over the past year.
She said the council aims to reduce the net cost of legal services for existing clients within the local authority by subsidising the service with income earned from other public sector clients. ‘We are taking a commercial approach while having clients at the heart of what we do,’ she said.
By 2017/18, the council intends to reduce the net cost of its legal department by 40% from £255,390 in 2013/14.
Legal departments in several councils are seeking to increase revenue to plug spending cuts by initiatives such as creating alternative business structures, such as HB Public Law, set up by London councils Harrow and Barnet last year.
Warhurst said the exchange scheme was a quicker way of earning extra revenue than creating a stand-alone business.
‘We didn’t want to spend time talking about what we could do,’ she said. ‘None of this would work if it wasn’t supported by our chief executive and internal clients,’ she added.
The legal team is currently 10-strong but Warhurst said there is scope for expansion.