Local government: alternative models of service delivery

This briefing paper explains new forms of service delivery being implemented by local authorities, including shared services, outsourcing, 'insourcing', local authority trading companies and mutuals.

Most local authorities no longer rely solely on “in house” operations to deliver services. This briefing paper provides an introduction to some of the alternative approaches being used by local authorities. These include the use of “shared services”, between multiple local authorities and also between local authorities and other public bodies; outsourcing to private or voluntary providers, and its opposite, “insourcing”; the increasing use of Local Authority Trading Companies (LATCs) to trade for profit, providing a revenue stream for the local authority; and mutuals.

The briefing also includes notes on research that has been conducted on shared services, outsourcing, and trading, plus links to relevant statistical sources.

This note covers England only. Local authorities in Scotland, Wales and Northern Ireland have also explored alternative approaches to service delivery. The legal situation is similar in each area, though differing in some details.