Participated in the annual Assist conference at St Andrews today. Its always a great opportunity to catch up with many friends who work in the FM sector in Scotland and sometimes from a bit further away.
I got roped in to an onstage debate with Fergus Chambers from Glasgow about the City Council's intention to set up a Limited Liability Partnership in the FM side of things. I was only given 45 minutes notice but sometimes that can work better in terms of making the debate more natural. Fergus spent ten minutes or so outlining the reasons behind the establishment of the LLP and then I was to question him. Fergus is a great character and it was great fun as the two of us verbally jousted on stage. Basically Fergus's case is because of the impact of equal pay it is impossible for his service to breakeven and the only way they can avoid the wrath of Audit Scotland is to put it at arms length.
There are a number of assumptions that I disagree with around the notion of the LLP approach. Firstly the right to award council contracts directly to an LLP without competition. Whilst I would accept that technically this may be possible at present if you can demonstrate that the Council owns and controls the company to the level of almost 100%, I would predict that within 3 years European case law around state aid will close this loophole and leave arms length vehicle high and dry if challenged. Even at present by definition an LLP involves another partner and is therefore challengable around state aid issues.
The second issue I would raise is with regards to equal pay, if an LLP is wholly owned by the Council for the purposes of awarding contracts how can it be far enough away to avoid being treated as an associated employer for the purposes of equal pay comparisons. This is a paradox that in my opinion is impossible to resolve.
For me the answer to the problem of the treatment of equal pay is much simpler, change the status of the service to that of a non significant trading operation and therefore avoid having to create an unnecessary and risky delivery vehicle.
When the debate was over Fergus and myself shook hands and I wished him and Glasgow best wishes with the strategy they appear committed too. The audience seemed to enjoy things and we got a lot of positive feedback. Having been asked to say grace at the dinner that evening I only just resisted throwing in a line about hoping contracts ain't challenged in future.