Shropshire Council going to spend £46 million on computers over five years – it’s not justified

This morning my iPad would not get going. The iPad is the only way I can access council emails outside of Shirehall. It has already been fixed three times this year. Last Wednesday, I wanted to access my council emails via a desktop in Shirehall. After 15 minutes, Outlook had not even loaded. I gave up.

These are some of the better aspects of Shropshire Council’s computing systems. Staff currently print details off one computer system and rekey the data into a second system because the council’s aged systems are not compatible. What a waste of effort and money.

The council is now proposing to spend £46 million on computing over five years – £9 million a year – to solve its problems with slow and inadequate computers.

I am totally convinced that the council’s computers need replacing.

But when we are struggling to find money to keep valued services like libraries and leisure centres open, I cannot accept we should spend so much on technology.

The council is planning to spend more than £21 million on replacing its decrepit computer systems. On top of this, the council plans to spend over £24 million on keeping its existing systems running over the same period. That’s nearly £46 million on computing over five years.

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Shropshire Council approved the ICT Digital Transformation Programme and its budget on Thursday. It was a majority vote with Labour and the Lib Dems voting against.

Us Lib Dems didn’t argue that the council should delay upgrading computers. We voted against because we were not satisfied that the council is getting the right solution at the right price. Councillor Hannah Fraser from Abbey ward in Shrewsbury asked for the council to get a second opinion before we spend so much money. Her request was rebuffed. The council would have had to spend tens of thousands at the very least on a second opinion but in my view it would be money well spent.

I am happy that this long overdue investment will improve customer services and give us a more reliable and secure hybrid cloud computing system. Staff will be able “to work anytime, anyplace, anywhere” and “be closer to the customer”. We will have a single record for every citizen we deal with, instead of having several records on different computer systems.

But I am not convinced this project will deliver financial benefits of nearly £30 million over a 5-year period.

More than £25 million of the benefits from this system upgrade will be non-cashable. That phrase means the benefits will not lead to a reduction in what the council spends but will instead deliver extra or better services.[1] Non-cashable savings are notoriously difficult to define and quantify. In my book, a project that delivers 85% of its financial benefits through non-cashables looks poorly justified.[2]

The council claims the new systems will allow it to respond more quickly to commercial opportunities. Shropshire Council has an appalling track record on grasping opportunities to draw in needed cash. A good computer system won’t deal with the poor management and leadership that blighted that its commercial company ip&e.

Shropshire Council is currently downsizing its service operations. Until the end of last year, the council was planning to transfer everything it could into ip&e. After that experiment failed, the council leadership has maintained the political position that it is a commissioning council. It still plans to transfer as many services as it can to other providers.

If so many services are to be spun out of Shirehall, will the council need all these computer systems? We didn’t get an answer at council.

In the justification for the new computer system, the council says that it will “use technology to help keep its citizens more independent, more connected and less reliant on public services.” I don’t really see how computers, whether based in Shirehall or on the cloud, will themselves make residents more independent and less reliant on public services. This is statement is typical of the way the council is bragging up the benefits of this expensive project.

Why are we in such a mess over computing? The fault lies firmly at the door of the Conservative leadership. Under former leader Keith Barrow, it failed to invest in computer systems, or anything else for that matter.

In not upgrading computers when needed, the council has reduced the efficiency of the council, increased staffing costs and supplied a poorer customer service.

I accept the case for upgrading computers and the software behind them. But I am not convinced that we need to spend £21 million on this project. This is the sort of money we might have spent in the 1990s. Computing systems are cheaper now.

I am worried that we are spending far too much on this programme. I don’t think the scheme has had proper scrutiny. At a time we are struggling to find money to keep valued services such as libraries, museums and leisure centres open, we need to be certain that the money we have is used wisely.

Notes

[1]. To the best of my recollection, the distinction between cashable and non-cashable savings was first used in anger in a review of the efficiency of central government public spending by Sir Peter Gershon in 2004. He argued that you could do more with the same money or the same with less money. So efficiencies can be divided into two types. Cashable efficiencies reduce the level of resources – staff, finance, infrastructure – that are required to achieve a given outcome. So the same level of happiness is achieved for less money. Non-cashable efficiencies entail improving outcomes for a given level of resource. People might be healthier or happier for the same level of public spending. Both of these measures of efficiency suffer from the same significant problem – how do you measure outputs accurately? Typically, non-cashable savings have been predicted to be much larger than cashable. They have also proved to be harder to deliver.

[2]. The report to council states: “The non-cashable benefits of £25.357m include efficiency savings in staffing generated by the introduction of true end to end processes, from process improvements and reduced double input across all services. It is also considered that improved integration and processes between all systems and high quality real time management information and business intelligence will deliver further efficiencies and service improvements. It will enable the workforce to become mobile and flexible supporting the reduction of assets. By supporting channel shift and providing seamless customer interaction this will also drive down back office costs and support the front line services to work more efficiently.”