WHY IS EVERYONE TALKING ABOUT PROPERTY?
These are just some of the reasons.
● Government Efficiency Agenda, increasing scrutiny of how assets are used and managed
● Recognition that good asset management is now an expectation of government, not just a desire
● An increasing requirement to demonstrate you are using property efficiently and effectively in delivering services
● A realisation that annual incremental change does not necessarily deliver innovative property solutions that support transformational business change
● Property has been on the radar of successive parliaments – why?
And some eminent people: knights and peers of the realm, distinguished public sector thinkers, authors, have all had something to say about property, for example:
Sir Michael Lyons: “Asset management is a key part of business planning which connects at strategic level, decisions about an organisation’s business needs, the deployment of its assets, and its future investment needs.”
Sir David Varney: “Any initiative that illuminates the dynamic between a business and its assets, and provides practical measures to improve that process, without adding unnecessary bureaucracy, is welcome!”
Lord Carter of Coles: “The Government should create a new central property function to drive efficient use of property across the whole of the public sector.”
Barry Quirk: The Quirk Review of Community Management and Ownership of Public Assets.
John Healy MP: Communities and Local Government, Building on Strong Foundations – A framework for Local Authority Asset Management.
Michael O’Higgins, Chairman, Audit Commission: Room for Improvement 2009.
Publications/Guidance: Operational Efficiency Programme, HM Treasury April 2009
The most relevant guidance for the public sector is the Operational Efficiency Programme (OEP). In terms of headlines this publication targeted the need to deliver £15 billion of annual savings from crosscutting and complimentary strands of:
● Back office operations and IT ● Collaborative procurement
ASSET - Liverpool-10
● Asset management and sales ● Property ● Local incentives/empowerment
The OEP identified that public sector property cost £25 billion annually to run which is 5% of public sector expenditure. This firmly establishes property as a priority area for any government. The guidance set a number of deliberately ambitious targets for example:
● £1.5 billion running cost efficiencies by 2012/2014; rising to £5 billion over a 10-year period
● 30% reduction in Central Government office space, 14.5 square meter/person down to 10 sm/person
● 20% reduction in the remaining (ie local authority) estate
● Asset sales proceeds of £20 billion over 10 years of which local authorities are responsible for £14 billion excluding council housing.
One of the key messages was that in driving efficiencies through a more effective use of property it is necessary to understand both what it costs and how property performs when delivering services.
Finally the OEP identified the following key areas of change, and the need for:
● Engaged senior management ● Strong incentives and controls for property use
● Good data, guidance and Key Performance Indicators (KPIs) “if it can’t be measured it can’t be managed”
● Collaboration and sharing property across organisational boundaries
What is interesting about these is that you find similar key recommendations in all publications about working and developing property strategies.
Publications/Guidance: Total Place, a whole are approach to public services, HM Treasury, 2010
Total Place is about addressing all public money going into a particular area and is directed towards intended area outcomes, regardless of organisational boundaries, and breaking down barriers. Key recommendations include:
● Weave local services together into a seamless web of support
● Define a new relationship with Government ● Citizen at the heart of service delivery ● Local authorities playing a pivotal role
● Local services working together to reduce waste and duplication
Mark O’Brien 9
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