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Unfair and unwanted. City council should stick to the business of frontline services rather than setting up speculative commercial ventures

17 August 2010

In these challenging economic times, local councils should be focusing even more determinedly on what they are best at and what people expect them to deliver on the frontline. 

So I was surprised to learn recently that Conservative-led Brighton and Hove City Council, which has been ordered to make £3.5 million worth of cuts by the Coalition government, announced that it was setting up a public relations company to trade commercially and with a view to winning 'clients' in the public sector.

That essentially means to trade to make a profit from other public sector services.

Things seem to have rather turned a full circle as far the Conservatives and local government services go.

Under the Tory governments in the 1980s and 1990s many council services had to be contracted out to the ‘cheapest' bidder (quality wasn't always a factor).

It became apparent that this wasn't necessarily cost-effective or financially sustainable in the longer term.

The result was often poor quality high cost services: some may recall the unhappy saga of Brighton's refuse services a few years back (by then under a Labour council and Government).

French company SITA pulled out of its contract and mountains of refuse appeared for weeks in the city's streets (recycling hadn't really taken off in a big way then...).

But this decision to set up a PR company takes us into completely new territory.

PR and marketing companies may be highly valued by their clients but they are not providing frontline public services.

Precious council funds should not be backing commercial ventures unconnected with their essential frontline responsibilities.

The city council says that this is about making a profit by trading to reinvest in public services.

But in my view, even if a profit is made, this still doesn't justify the investment.

It's true that councils in the past provided a wide range of services that today are now in the private sector. Water and bus services are examples of enterprises that were once in local authority ownership and are now privatised companies.

But there is a fundamental difference: these are core public services or utilities which naturally fitted within a municipal provider system and arguably are more efficient and accountable if they remain in public control.

Even the savviest PR professional would have an incredibly difficult task in persuading anyone that a commercially-competing PR company falls into this category - that it's a frontline public service or utility.

Put simply, councils have no business to be funding speculative business ventures - which always carry risk.

They shouldn't permit their employees to be diverted away from their primary task of ensuring high quality, responsive services.

Council communications professionals are employed to serve the council and inform the community about important developments and decisions.

If other public agencies such as the NHS or police need communications expertise from outside, they should look to the city's creative, independent business and social enterprise sector.

Many are young communications businesses who would love the opportunity to support public agencies.

They have the talent and local knowledge to really make a difference and would be disadvantaged by an in-house competitor.

There is something fundamentally unjust about a council using tax payers' money to fund speculative ventures in the private sector where there's no public service element to what they do.

Leave that to independent businesses who can take the financial risk with their own money.

Instead focus on what councils should be doing: delivering essential front line services to the community.

That's what they're there to do.

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