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Workforce: Local government mutual spinouts

Central Government is promoting the role of staff-led mutuals in the delivery of public services. Local Government has been moving to explore and support staff-led spin-outs in a variety of ways over the last couple of years and their employees are included in the kinds of groups eligible to submit expressions of interest under the 'Community Right to Challenge' in the Localism Act.

The LGA has, with partners, produced a series of case studies from councils detailing their mutual spin outs for the delivery of public services.

To access the case studies you need to login to the Workforce Matters Knowledge Hub Group (new users will need to register). The Knowledge Hub gives the the opportunity to interact, comment and develop the case studies.

The case studies in the K-hub are:

Case Study/ organisation Local authority Political control Services / sector Developments Individual transition challenges
3BM School support services Tri-borough (Royal Borough of Kensington and Chelsea, Westminster City Council, London Borough of Hammersmith and Fulham) Conservative School support services

Staff: 40

Budget/turnover: £3million per annum

Main clients: Individual schools, councils

(Treated as a) Part A service

Procurement processes for an independent sector partner to join the mutual joint venture


Working across three London boroughs to manage processes such as TUPE

Aspire Sussex West Sussex County Council Conservative Adult and community learning

Staff: 560 (65 permanent staff delivering 46 full time equivalent and 495 tutors delivering 37 full time equivalent)

Budget/turnover: £4.5million per annum

Main clients: 22,000 students in 200 community venues

Part B service

Developing the business case and planning the transition


Timing – ensuring the business case was prepared in line with Council decision making processes


Engaging a large staff group

The Hazlitt Arts Centre Maidstone Borough Council Conservative Arts and Theatre

Staff: 40 (5 full time, 35 part time)

Budget/turnover: £1.1million per annum

Main clients: Maidstone residents and surrounding communities, arts groups.

Part B service

Ensuring a level playing field for all potential bidders once the contract for the service is put out to tender


Ensuring the new mutual is established by the time the invitation to tender is issued by the Council so it can bid to provide the service

Project Salus Kent County Council Conservative Social skills, educational outcomes, emotional health and wellbeing (for children, young people and their families)

Staff: 34 staff (most are term time only)

Budget/turnover: £800,000 pre spin-out, estimated £1.2million first year of trading

Main clients: Children's workforce and schools, children, young people and families

Part B service

Lack of understanding amongst stakeholders of the process to be undertaken when pursuing a public sector mutual spin-out (Project Salus was an early spin-out)


Disseminating advice and information gathered by the leaders of the transition amongst stakeholders


No access to external legal advice

RBKC Youth Services Royal Borough of Kensington and Chelsea Conservative Youth services

Staff: 170 (70 full time equivalent)

Budget/turnover: £5million per annum

Main clients: Royal Borough of Kensington and Chelsea

Part B service

Communicating the idea to pursue a mutual spin-out and the details of the spin-out (e.g. employee terms and conditions) to all staff


Establishing viability in a changing funding landscape

Sensing Change Suffolk County Council Conservative Sensory impairment services

Staff: 44 (22 full time equivalent)

Budget/turnover: £1.8 million

Main clients: Adults with sensory impairment (sight and/or hearing loss)

Part B service

Negotiating a phased transition (as a Social Work Practice Pilot) with the Council and the Department of Health


Establishing the associated governance arrangements

Sunshine Care C.I.C. Rochdale Metropolitan Borough Council Labour Home care/support

Staff: 26 part time

Budget/turnover: not stated

Main clients: 54 individual customers

Part B service

Finding the right support and advice and accessing expertise e.g. legal and financial


Maintaining positive relationships with the Council during a very rapid transition