PARTNERSHIPS FOR CHANGE (OR SCALING THE MOUNTAIN)


INTRODUCTION


Throughout the General Election campaign we heard a lot about the deficit and deficit reduction, and about this black hole in government finances. After the events of early May 2010 we now need to focus on solutions. Holes and deficits are not the language of ambition; no one ever said that their life’s dream was to climb out of a hole. But people do aspire to climb mountains, so my key theme in this paper is how to scale the mountain that is in front of us. And more specifically what is the role of partnership working in helping us make that climb.


As property professionals, the challenge for us all is how do we: -


● TRANSFORM public services, ● DELIVER efficiencies and ● KEEP regeneration and development projects moving.


This is a sizeable challenge, of Mount Everest proportions. We may not all reach the summit, but we need to start moving, step-by-step up the mountain.


Agenda


I intend to explore how we climb this mountain through partnership working involving both the public and private sectors. I will consider in more detail the following topics.


● The scale of the challenge; we face a period of major change in public service delivery. We need to face up to that challenge.


● Available equipment; I will review some of the toolkit available and consider whether we have the equipment we need, whether it is fit for purpose and what new equipment is needed.


● Developing partnerships; what should the role of public private partnerships be, and


● What have existing partnerships delivered? ● What have they NOT delivered?


ASSET - Liverpool-10


These numbers show the historic nature of the problem. The revenue figures look more palatable than the capital. Over the last decade, revenue expenditure grew by 3.9% per annum in real terms. For the next spending review, Labour was talking of growth of just 0.7% per annum, but this includes debt repayment, increasing benefit payments and so on. Thus revenue support for frontline services will dramatically reduce.


John Keyes 23


● Do we need new types of partnerships with different ambitions?


● What will new partnerships look like? ● What legal structures will be appropriate?


● And successful partnerships rely on the creation of value to enable the private sector to make a profit. How to create value to make partnerships work.


● Keys to success; what is essential if we are to deliver?


The Scale of the Challenge The General Election campaign was something of a phoney war particularly around the scale of the deficit problem, where funding cuts will need to be made and around the implications for public services deemed to be of lower order of priority. Further details will begin to emerge over the next few weeks especially in the Emergency Budget probably due in July. Meanwhile there are lots of different numbers out there, which illustrate the problems that the new government is dealing with.


For example John McCready, Head of the Property Unit at the Shareholder Executive, quoted these in one of his first public interviews. They are striking as the problem is rarely presented so starkly.


“In 2008-09, public expenditure was £622 billion. Tax revenues were £498 billion.”


This is like a household with a monthly income of £4000, adding £1000 to its credit card debt each month.


And see this second set of numbers is from the Institute of Fiscal Studies and actually come from the time of the 2009 Budget. But the 2010 figures were not materially different.


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