Document

Report
Creating the Government property assets of the future
Making sense of a public estates strategy
with real local control
Andrew Smith, Chief Executive
Hampshire County Council
Why now?
• £128bn current book value for local government
property
• £15bn p.a. capital spend
• Unprecedented financial pressure
• Lack of co-ordinated estates strategy and delivery
approach
• Strong desire for a local demand-led approach
• Appetite for real reform – government is ready to
remove barriers
Government has recognised the wider public sector opportunity - the coordination of both
capital and assets through a commissioning-based approach will maximise efficiencies,
deliver improved services and other opportunities such as job creation
Opportunities
• Understand need
• Shared services
• Assets and capital
assessed
Commissioning
• Driver for strategic
approach
procurement programme
which could include
greening agenda SMEs
and apprentices
£ benefits
20%+
Reduced need
Construction,
procurement,
Source:
SE IEP
/Reading
BC estimate
10-15%
Construction,
procurement
Source:
HCC
Care Home
case study
Opportunities
• Economic
development
• Inter authority
Joined up programme (multi collaboration
projects)
2-5%
Construction,
procurement
One off project
Source:
SE IEP
0
Elapsed time
Time
Opportunities
• Better
delivery
• Predictability
The SE IEP estimate that a 20% saving on
capital costs could be achieved through
smarter procurement including the use of
existing assets.
In addition, a comprehensive approach to
assets could generate £35bn in capital
receipts over 10 years in addition to savings
in revenue.
£35bn in capital
receipts could
be raised over
10 years
Total of
£370bn
worth of
assets
3
£30 billion
per annum
in new
capital
investment
generate modernisation /
rationalisation plans
£370bn
existing
buildings,
one third of
all non
domestic
stock
Commissioning approach
A local demand-led approach could significantly rationalise the public estate
whilst maximising other benefits such as job creation and improved energy
performance through retro-fitting
Efficiencies
+ some
surplus
assets
recycled as
capital
Case Study:
Hampshire County Council
Headquarters Refurbishment
Fewer
buildings,
better used,
higher
performing
and more
sustainable
Jobs in
construction
and supply
chain; skills
created for
retrofit work
• 75% more staff accommodated
• 30% more space efficient
• 4500m2 reduction in council’s use of
office space
• £200,000 per annum saving on
running costs
• 50% reduction in energy costs
4
The Big Idea – how the NIEP can
support this approach
• Co-ordination of local government and integral
part of Capital and Assets Pathfinders
• Procure once on behalf of many
• Get collaboration and aggregation benefits
• Build national leadership – further leverage
• Leave local choice in place
• Sponsored by CLG
How to do it?
The Barriers
•
•
•
•
•
Council sovereignty
‘not invented here’
Local capacity
Fragmented budgets
Collaborative arrangements do not exist
The obstacles are not technical. Local
government can now address some of the most
complicated asset management challenges in
government.
Opportunities
•
•
•
•
•
•
Benefits of joint working
Reshape the market
Savings / efficiency
Demonstrating local government leadership
Local choice
Cross departmental and organisational working /
geography
• Improving the customer experience

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