Councils are the new entrepreneurs
Commercially minded and at the vanguard of innovation — few would describe local boroughs as such exciting places to work. But if authorities are to meet growing demand, they are going to have to attract bright brains, writes Niki Chesworth
FEW associate the public sector with entrepreneurialism and innovation. However, dedicated public servants who think they can deliver services better or more efficiently can be both entrepreneurial and innovative by running their own enterprise — a public service mutual.
These organisations, that have left the public sector but continue to deliver the service, are just one of the options for those who want to combine their passion for helping others with an interesting career.
Public sector mutuals are part of a new wave of entrepreneurialism in local authorities with six in 10 now owning trading companies and most now operating a joint venture with the private sector.
Without entrepreneurial activities, eight in 10 say they would have to cut services and raise taxes, according to a new report from Localis, Commercial Councils: The Rise of Entrepreneurialism in Local Government, which forecasts that the entrepreneurial councils agenda could account for at least £27.4 billion of additional revenue for local councils by 2020. This could subsidise the construction of 80,000 homes across England or pay the annual salaries of more than 58,000 teachers.
However, entrepreneurialism takes a different mindset, which is why councils and the appropriate professional bodies are being told they need to increase the focus on commercial and financial skills as part of professional development. They also h ave to attrac t the right talent, including bright graduates who could have their pick of any career path. So why, when local authorities are struggling in challenging times, would anyone want to work for a borough?
It certainly will not be for the pay. Recent research by Emolument.com reveals there is little difference in pay for a graduate with less than five years’ experience who works in local government, accounting, marketing or media. However, as the years add up the career difference is vast.
After 15 years into a career, those in the media can expect to earn as much as 87 per cent more — or about £63,000 — if they work as a media executive rather than in local government.
The gap is even larger when compared with finance. A senior professional in local government with 15-plus years’ experience can expect to earn £72,000 compared to £304,000 in the financial sector.
So you would think that authorities would really struggle to attract talent. Howeve r, the Local Government Association’s National Graduate Development Programme (NGDP), which is currently selecting its next cohort, has thousands of applicants.
Alex Thomson, chief executive of Local is, says this is because local authorities are now an exciting place to work. “Councils have borne the br unt of austerity, but they have responded with striking innovation to minimise the impact of cuts on their residents. In particular, our research shows councils becoming ever more commercially savvy, bringing money to support vital local services. There is
Alex Thomson, Localis chief executive
also a growing movement towards localism and all authorities are becoming more innovative and entrepreneurial,” says Thomson.
“If they continue in this vein, council income from trading will treble in value by 2020, bringing in 18 per cent of budgets, up from six per cent today. However, the challenge is that the skills are not necessarily there and commercial skills now need to be at the heart of development of all public sector officials. But we also know that there are already highly skilled people within local government.
“Councils attract people who want to do something for their community as they feel their work will be more worthwhile and often more interesting.
“Although they may not believe in working in a profit- orientated environment, they are getting better at it, particularly as more and more professionals are working in shared services for two or even three authorities. That allows them to be better paid and makes the jobs more interesting. Local authorities do attract some high quality people from central government and even the pr ivate sector.”
Every year between 1,500 and 2,000 graduates apply for a place on the programme run by the Local Government Association, with only 100 to 120 places per cohort.
“Graduates who apply are often motivated by the tangible, positive outcomes provided by a career in local government,” says a spokesperson for the NGDP.
“Passionate about making local communities better, they want to help councils innovate and transform to continue improving service provision. The variety of work, from policy to frontline delivery, and the broad range of issues including housing, economic regeneration, public health, education and green initiatives to name a few, offer unlimited opportunities.”
Local authorities also offer a wide variet y of other roles — not just in management but also finance, procurement and HR.
Mark Hynes, who has worked in both the private and public sector as a solicitor, says:“I continue to be impressed at the talent and dedication of the lawyers we are able to attract into local government.
“If you are entering local government as a trainee solicitor, one of the unique advantages you enjoy over your counterparts in the private sector is the rights of audience that are conferred on officers with a local authority before a magistrates’ court, where local authorities will often be bringing various prosecutions, such as trading standards and planning enforcement matters.
“Also, a trainee solicitor can expect to be spoilt for choice in terms of the wide range of areas that in-house local authority lawyers get involved in. In fact, I would be struggling to think of a more varied work environment for a trainee solicitor to gain valuable legal experience.”
Finance professionals also find the public sector can offer benefits not available within the private sector, with the Chartered Institute of Public Finance & Accountancy saying that two years after qualifying, earnings range between £32,000 and £65,000 with senior level post holders earning upwards of £80,000.
‘Although councils may not believe in working in a profit-driven environment, they are getting better at it