They say …..
(source: The Independent - Tue, 12 Jul 2010)
Two constabularies are to merge, in the first force amalgamation for more than 30 years.
Bedfordshire and Hertfordshire Police yesterday published a paper stating that a “full and voluntary merger is the preferred option”. They have forecast a combined budget gap of £40.6m over the next four years. At 6,200 strong, the new force would be the 10th largest in England and Wales and would deliver savings of £20.4m, the report, seen by Police Review magazine, says.
Jobs are expected to be lost in the merger. The union would have to go to public consultation and be approved by the Home Secretary.
I say ……
Failure is not an option for merging constabularies - but can they afford the initial investment that will generate the future savings?
It will have taken a major worldwide financial crisis to force public services to look at creative ways of cutting costs without reducing their service. The pursuit of continuous improvement which is at the heart of any commercial business did not until recently appear to apply to public administrations. Spontaneously, one would feel that the more “local” a police force can be, the closer it will be to the daily lives of the people in the community it is serving. But so much local autonomy comes at a cost, and when saving money becomes a priority, it is worth looking at the cost of that autonomy.
Merging two constabularies to total a force of 6,200 does not seem to be a huge task compared to some of the mergers that take place on national or international markets. And the proposed saving of £ 20.4m only amounts to a little over £ 3,000 per constable per year; that is enough to make up for half of those constabularies’ current deficit, but what really matters is how much those £ 20.4m represent of the current total administrative overhead costs : is the scheme aiming to save 10% (let’s be a little more ambitious), 25% (there’s a stretch target) or 50% (stop dreaming) ?
The main difficulty in the current economic climate is that beyond the usual challenges of integrating two organisations in a merger, the integration costs need to be borne before any of the savings can be derived from the new organisation. Where will that additional funding come from, at a moment when the prime objective is to cut budgets and reverse the current negative cash-flow ?
The source of savings will be a reduction in administrative headcount, which will require a handsome pay-out in the form of redundancy payments. But that headcount cannot be reduced before systems are harmonised, people retrained, data reformatted and integrated : what are the costs and the likely timeline of that convergence of computer systems and communications equipment? And when the two constabularies will operate as one, it is unlikely that any of the existing premises will be large enough to house the combined organisation : how, when, where and at what cost will they need to relocate?
The notion of seeking efficiency improvements through economies of scale makes eminent sake. But like for any other Merger or Acquisition, the devil is in the detail. Careful pre-planning and a realistic approach to assessing the integration costs and the resources that will be required to make it happen is an imperative prerequisite. The majority of business integrations fail because they underestimate those resources and the amount of detailed planning that are required to succeed. If a commercial integration fails, the shareholders who voted in majority in favour for the merger or acquisition will bear the consequences of their mistake. In the case of two constabularies merging, there is no space for failure because the communities served by Bedfordshire and Hertfordshire Police are unlikely to accept inadequate policing if the two forces struggle to integrate into one.