Devon and Somerset Fire and Rescue Authority’s (DSFRA) shared service agreement, which began in April 2007, has exceeded its anticipated savings by £1.22 million.
According to a detailed report carried out by the Local Government Association (LGA), DSFRA expected to deliver savings of just over £3 million up until 2011/12, but has in fact accumulated financial savings of £4.2 million to date.
Further savings are expected up until 2014/15, which could bring the total savings to £8.25 million.
Of what has already been saved, DSFRA attributed £1.75 million to IT and finance, whilst savings on staff, training and insurance have also contributed to additional savings.
However, despite the financial benefits, the LGA highlights that even more could have been achieved if DSFRA had continued on its original path when joining forces.
“The project’s early momentum for change was however diminished at the point of combination. The project team was disbanded and this left a vacuum where departments were working largely in isolation without an integrated project plan," the LGA said.
“This resulted in a reduction of the drive and co-ordination to realise the benefits identified prior to combination and to ensure harmonisation was achieved as quickly as possible.”
It added: “Areas where potential savings could have been made earlier, such as asset management and procurement, are only now beginning to be realised.”
The LGA has carried out a number of other case studies assessing the benefits of shared services, where it also found that Hoople, a joint venture company that was set up between three partners across local government and the NHS in Hertfordshire in 2011, achieved savings of £619,000 in just 12 months by integrating back office functions, including IT.
Meanwwhile a shared service agreement between Cambridgeshire and Northamptonshire County Councils is forecast to save nearly £5 million in annual ICT costs, after an agreement was set up in 2010 to cover back office, professional and frontline services, including ICT, finance and HR.