Two into one would save millions, make a better council for Newcastle and North Tyneside, say Lib Dems

Liberal Democrats in Newcastle and North Tyneside are calling for a review of the potential savings and operational practicalities of combining the two local authority bureaurocracies ies into one.

The Lib Dems estimate that savings in management salaries alone could be worth more than four million pounds a year. This could be used to protect frontline services, which are currently under such pressure.

In a joint statement, Councillor Anita Lower, Liberal Democrat Group Leader on Newcastle City Council and Jack Mowatt, Chair of North Tyneside Liberal Democrats, said:

"At a time when frontline council services are under such pressure, radical solutions are needed, and here we have neighbouring councils with so many things in common doing exactly the same things with two of everything and everyone. Creating one combined council will make a lot of sense to many people.

"We are calling for a joint review group to be set up between the two councils, including representatives of their scrutiny functions and with external, possibly business, representation to ensure independence and rigour. We also think it essential for the public to be consulted.

"Of course it would take some time to realise all the savings, but we now know the financial settlement for local government until 2020, so this is exactly the right time to look at the practicalities and, if feasible, to develop a plan to work towards amalgamation over the coming years.

"A start could be made by integrating the more senior officer teams. From the 2014/15 published accounts of the two authorities, we have looked at officers earning over £50,000 per annum (excluding teachers and those who have left with redundancy payments), of whom there are over 150 in the two councils - we estimate that it would be possible to save 40-50% of the salary costs in this category over time, amounting to at least four million pounds. Further salary savings could be possible at the next levels down of supervision, and it would be a chance to make best use of the talents available across the two councils.

"To head-off a knee-jerk negative reaction from the leaderships of the two councils we point out that there are plenty of precedents around the country - several District councils have already come together, for example. Recent reform of local government in Northern Ireland saw the replacement of the twenty-six districts created in 1973 with eleven "super councils" in 2014. The Labour-run Welsh government has announced plans to reduce 22 council to eight or nine and claim potential savings of £650m over ten years. So what is sacrosanct about Metropolitan Councils? The review could include testing Government's reaction, but it seems highly unlikely to us that the Government would refuse if the two Councils were in favour and there was public support.

"Investigations should also include the scope for shared use of land and buildings (and sale of what is surplus); standardisation of IT and of public and business-facing services; a single, non-competitive, local planning framework with new housing built in the most suitable locations; also, a reduction in the number of councillors following a Boundary Commission review, perhaps deferred to 2021 (Newcastle will have new boundaries in 2018 anyway), which itself could also save hundreds of thousands of pounds. Overall, there must be the opportunity to save several tens of millions of pounds.

"Over and above rationalisation and efficiency savings, there are several other potential benefits:

"For example, one authority of close to 500,000 population would have much more national clout, with a higher ranking among the core cities, and with a population greater than Bristol, Manchester or Liverpool.

"Also, there has been real difficulty in making much progress on the shared services agenda between councils as no-one wants to give up their empires. This would help unlock it, at least for these two neighbouring authorities.

"However, none of this need stop other cross-authority partnerships or collaborations such as the development of the North East Combined Authority or the continuation of the Newcastle Gateshead Initiative. We need a pragmatic approach, with functions provided at the most logical and efficient level

"That said, there seems to us to be more of a shared civic feel, both historic and present, for the urban area north of the Tyne. It would be good to test this as well as the logistics and financial savings of our proposal.

"At this stage we are simply calling upon the two councils to take a serious look at the possibility. If proposals were to be brought forward, there should be a referendum for the public to make the final decision.

"We would also be interested to hear the views of other interested parties - we will be inviting comments from the business community and the voluntary and community sectors in the two council areas, as well as other interested parties".

Information from the 2014/15 annual accounts of the councils show that together Newcastle and North Tyneside Councils have a gross revenue expenditure of over £1.3bn; capital expenditure of over £200m; property, plant and equipment assets valued at £2.7bn and net assets (after borrowings, creditors and pension and other liabilities) of £360m.