Rotherham Metropolitan Borough Council has a population of 253,400 and is situated in South Yorkshire. In 2007/08 the council spent £391.9 million on all council services. During SR04 the council developed an efficiency and Value for Money (VFM) planning process called Base Budget Reviews (BBRs) that was embedded with the council's financial planning and budget setting processes. The BBRs enabled the council to achieve back office efficiency savings of £19.3 million (56 per cent of total efficiencies) during SR04. The council is planning to use the BBR process to identify further back office efficiency savings during CSR07.
The situation
Prior to SR04 Rotherham MBC had separate back office functions and front line services. Compartmentalised work processes had created inefficiencies. Efficiency planning and monitoring at the council was confined to individual services and service improvements did not provide VFM.
Approaches used and efficiencies realised
Planning for VFM and efficiencies
In 2005 the council introduced a new efficiency and VFM monitoring process called 'Base Budget Reviews' (BBRs) that was integrated with financial planning and budget setting processes. The council created BBRs to examine service expenditure to inform:
- Budget and financial management
- Service planning
- Corporate plan
- Community strategy
- Efficiency targets and monitoring
- The medium term financial strategy (MTFS)
- UoR assessment for CPA
The council made the BBRs an annual part of the council's financial planning and budget setting process, to inform planning for efficiency savings and VFM improvements.
Conducting a base budget review
The council developed an annual, rolling review process for each set of BBRs that was conducted.
Stage 1: Planning the BBR programme: April to July
- The Director of Finance proposes to the Corporate Management Team which services should undergo a BBR and develops a BBR programme for the financial year
- The Cabinet agrees and ratifies the BBR programme
Stage 2: Preparing for the BBRs: July to September
- The Heads of Service that are undergoing a BBR complete two self-assessments: the BBR self-assessment to inform budget planning and the VFM self-assessment to inform the council's VFM and efficiency plans
- The BBR self-assessment comprises an examination of:
- How the services link to the council's corporate plan
- If the service includes statuary services
- Service budget and financial costs
- Service performance
- Efficiency savings - efficiencies achieved and planned
- How the service provides or does not provide VFM
- Potential improvements or changes to the service
- The VFM self-assessment comprises a review of:
- Service performance
- How the service links to financial planning processes (including the MTFS) to inform VFM service improvements
- VFM risks
- Efficiency savings
Stage 3: The BBR Panel: September to October
- The Heads of Service present their completed self-assessments to the BBR Panel consisting of both Cabinet and Scrutiny Members, the Director of Finance and the Chief Executive and partner representatives if applicable.
- The panel discusses each service looking at:
- How each service contributes to the corporate plan
- How the budget is structured to deliver services
- Whether the service provides VFM
- How the service plans to improve VFM
- The panel then decides how each service needs to be improved and a BBR Conclusion Report is produced that details how the service needs to be improved.
Stage 4: Implementing the BBR service improvements: October to March
- The Heads of Service implement the changes described in the BBR Conclusion Report
- The council's Cabinet receives regular updates on the progress of the BBR programme from the Director of Finance and the Councillor portfolio holder for performance, VFM and efficiency
- The council's overview and scrutiny committees scrutinise the BBR programme and highlight areas for change or improvement
- The changes recommended in the BBR Conclusion Report are then incorporated into the council's budget and MTFS
Source: Rotherham Metropolitan Borough Council
The BBR programme enabled Rotherham MBC to embed efficiency and VFM planning with the council's financial planning and budget setting processes. The council used the BBR review process to achieve back office efficiency savings of £19.3 million (56 per cent of total efficiencies) during SR04.
Plans for CSR07
The council is planning to use the BBR process to make identify efficiency savings during CSR07.
Learning points
- Rotherham MBC took a transitional approach to back office efficiency during SR04
- The BBR review process is embedded with the council's financial planning and budget setting processes (including the medium term financial strategy)
- The BBR self-assessment and VFM self-assessment consider efficiency and VFM as part of wider service improvements
- Councillors are fully involved in the BBR process at the council. The council has a cabinet portfolio holder for performance, VFM and efficiency and overview and scrutiny committees monitor and evaluate BBR reviews
Questions to consider for your council
- What approach has your council taken to back office efficiency during SR04?
- Transactional
- Transitional
- Transformational
- How might this case study enable you to take a transformational approach to efficiency during CSR07?
- Do you have an efficiency and VFM planning process that is integrated with financial planning and budget setting processes (including the medium term financial strategy)?
- If you have an efficiency and VFM planning process, is efficiency and VFM considered as part of wider service improvements?
- Are councillors involved in planning and implementing efficiency and VFM improvements at your council?
- Do you use your overview and scrutiny committees to monitor and evaluate efficiency and VFM improvements?