More Thoughts from Ontario CAOs: Municipal Efficiencies and Modernization
Many, if not all the municipalities in Ontario have some type of shared service agreements in place with their neighbours. Some common examples of shared services include:
- Regional fire
- Public transportation
- Roads and streets
- Solid waste
- Water and wastewater services
- Economic development
- Building code compliance
The Magic of Shared Service Agreements
The range of service identified within each shared service agreement varies from region to region. The major assumption applied to shared service agreements is that partnering with others within a region generates economic advantage in the form of greater economies of scale.
Sharing services can reduce the per unit cost of services by sharing staff, equipment and other resources.
“We take a collaborative approach. We’re all the same taxpayer, so shared services are worth looking at.”
While it is generally good to save costs, sharing services can have a negative side from the standpoint of service delivery.
Peter Crockett, CAO for the County of Oxford questions whether size drives efficiency, “does size drive efficiency, or does size detract from service delivery from the standpoint of reduced access?”
Imagine you were in a rural municipality that participated in a shared roadbuilding and maintenance program. It’s very possible that the completion of various construction and maintenance may not happen on a preferred schedule because other community partners also have projects on the go.
Generally, there can be inconvenience to the end user that is created when services are spread across several municipal jurisdictions.
Often these conveniences are understood and accepted in return to the cost savings that are gained.
“I don’t know if there’s a one size fits all solution,” adds Crockett.
Can’t Government Run More like a Business?
It’s a noble pursuit for local governments to try harder to be more business-like. While skilled public servants are hard at work delivering services, they alone may not have the tools or resources to generate efficiency by themselves.
Denise Corry states,
“Efficiency means that we will continue to provide services, but in a different way. That could mean contracting or partnering with another municipality.”
From the perspective of modernization, Corry adds:
“We will need to use all digital strategies to transform and reduce future costs. This means that we will have to have an open discussion about digital services, online services, web apps and open data as broadband becomes more available in our region.”
Ultimately, decisions around efficiency and modernization at the local level rely on strong political decision-making.
If there is a political will to introduce changes, it’s more likely efficiency will be a result.
What's the Incentive to Do More with Less?
In Ontario, the greatest incentive may be the impending threat of super-regionalization, as municipalities hold their breath awaiting a Regional Governance Review that includes 82 local municipalities from across the province.
In 2018, the province looked to health regions to consolidate their operations into bigger service areas in the hopes of reducing administrative costs.
Peter Crockett remarks, “The governance review is all about governance, service, standards and decision-making. It sets the stage for efficiencies and access to services as well as streamlining the decision-making process and saving time in the process.”
At a time when there is a great deal of uncertainty, municipalities must still deliver services with even more pressure to do better every day.
The citizens, as municipal residents and provincial taxpayers, expect that service levels will be maintained while costs are controlled or reduced. This challenging scenario may be the right way to drive innovation.
“We (CAOs) are all thinking along the same lines, be prepared to work outside the box. We have to continue to move as things change.” concludes Denise Corry.
What can you expect from the Service modernization funding for small and rural communities?