500 jobs to go as three London councils merge services

Hammersmith & Fulham, Kensington & Chelsea and Westminster city councils plan to combine back-office and management costs in an effort to save £35m a year

Three Conservative-led London councils are planning a super-merger by combining services and cutting senior posts to cut costs, with the loss of 500 jobs.

In move welcomed by Eric Pickles, the communities secretary, Hammersmith & Fulham council, the Royal Borough of Kensington & Chelsea and Westminster city council are proposing to combine back-office and management costs that they say should save £35m a year.

The plans include reducing the number of chief executives from three to two, combining children’s and education services with a single director and combining other services including leisure, highways, transport and parking.

Around 175 of the jobs would be lost from senior management, with the rest affecting technical and supervisory roles. The chief executive of Hammersmith & Fulham council is paid around £200,000.

However, each local authority will retain the same number of councillors each year, set its own budget and council tax, and continue to set its own decisions and spending priorities.

Services such as housing management, licensing and planning will not be combined.

The document outlining the proposals, due to be discussed at the councils’ respective cabinets over the next 12 days, states that the three boroughs will continue to develop ideas and to support the “big society”, to find ways to “reduce demands on local taxpayers” while maintaining excellence.

Sir Merrick Cockell, leader of the Kensington & Chelsea, said: “Our councils remain committed to localism, with local decision-making and accountability. Indeed, combining services will increase our ability to respond and engage on local issues and ensure a greater share of resources going to the vital frontline.”

Stephen Greenhalgh, leader of Hammersmith & Fulham, said: “Our taxpayers expect us to squeeze every pound and penny to reduce unnecessary costs. We are not creating one super council, we are creating three slimmer councils with combined resources and expertise.

“Our residents should not notice the difference except in areas such as adult social care where there will be a marked improvement because we are able to fully integrate health and social care.”

But the Labour group at Westminster council said the merger was “hatched behind closed doors” and could make services more remote for local residents.

The Labour group leader, Paul Dimoldenberg, said: “At a time when the Conservatives are preaching the virtues of ‘localism’, the creation of a number of large super-council departments serving over 600,000 people, based miles away from the people they are supposed to serve, will make all three councils more remote, less accessible and less accountable.

“These plans, for which these three councils have no mandate from the electorate, have been hatched behind closed doors and have deliberately been kept secret from opposition councillors and local MPs.”

The proposal by three flagship Tory councils was praised by Pickles, who has been pressing local authorities to share services as a way of saving money in light of the cuts rather than cutting frontline jobs.

“It is great to see three big London councils lead the way sharing senior staff and back offices, saving taxpayers millions of pounds and showing its possible to do more for less and protect frontline services in the process,” he said.

“This shows that the sharing of back office services by councils can go hand in hand with continued local accountability to their individual local electorates. The new localism powers and spending freedoms we are handing councils will help be as efficient and effective as possible.”

Boris Johnson, the Conservative London mayor, is also pioneering government proposals by looking at whether to axe the Greater London authority chief executive post and assuming many of the functions himself, in line with ministers’ plans for a new wave of directly elected mayors in 12 major cities.