How the City of Utrecht achieved major budget savings through innovative service reviews

For selecting the leaders of the eleven review teams, a comparable process was followed. First, the Review Director wrote an outline for each service specific review (e.g. library services) in which he set out the goals and ambitions of the review. This outline was positively framed. For example, leading questions departed from changes in library-environment which had to be linked to the improvement and long-term performance of the library itself, by using best practices around the country.

This outline was sent to a maximum of five library experts (consultants) in The Netherlands, with the request to make a specific proposal for the review of the Utrecht library within the central framework set out by the Review Director. From the received proposals, the two best external experts were invited for a presentation and discussion with the Review Director, city manager and library director. On the basis of this presentation, the leader of the review team was selected. To guarantee the objectivity of the review, this was the only stage at which the respective service managers had influence on the approach and results of the review.

The review leader of each service review team was responsible for the development of independent statements regarding the transformation and budget cuts of the concerned policy area. Because they had to rely on the co-operation of the public officers in the review team, most review leaders involved them in finalizing the research method of the review (which had to be approved by the Review Director). However, the review leader was the only person held responsible for the objectivity and level of ambition of the review.

Each review had to be carried out within six weeks. Once the review report had been finalised the review leader was invited to present the results to (in case of the library) the Review Director, the alderman responsible for the library, the city manager and the library director. Subsequently, the report had to be presented to the corporate management team meeting chaired by the city manager. Following these discussions, the results were aggregated into three summaries and presented to the board of aldermen and mayor. At this stage, minor amendments could be made to the reviews but no far-reaching changes could be made.

As a last step, with the coordination of the Review Director an overarching plan was prepared which combined the individual reports’ and expected savings and linked them to broader organisational development issues. This overarching plan was accepted by the aldermen and presented to the local council in spring 2011.

4. Looking back: difficulties and success factors

In retrospect, three difficulties can be identified:

1. The comparability of the individual reviews - The 11 reviews vary not only in terms of scope, approach and depth, but also in terms of quality and validity. These differences are mostly due to the availability of time, benchmarking data and specific expertise in the review team. Also, some services (e.g. libraries) are relatively simple, while others are complex and wide-ranging (e.g. social care). Nevertheless, each report addresses the key issues and challenges of the specific topic and uncovers the potential for improvement and budgetary cuts.
2. Second, the level of ownership felt by the department directors turned out to be lower than expected. Although this was seen as a risk from the beginning (and department directors therefore were involved in selecting the review leader), during the process many tensions could be perceived. For example, one department director tried to influence individual members of the review team to withhold relevant information. Furthermore, during the presentations of the individual results, the stakes became higher and higher, resulting in strong efforts to lower the savings and reform potential of a specific review. The most significant debates clearly occurred while discussing lower quality reviews which were seen to have more limited validity.
3. A third difficulty was the impact of the failed core-task analysis. Although this analysis was indeed made (but not under the control of the Review Director), no specific cuts could be related to its results. So, because a savings potential of €55m had to be uncovered by the overall combination of the review, the reduction in hiring of external staff and the core-task analysis, the failure to find savings in the core-task analysis led to increased pressure on the review to come up with savings.

Looking at the success factors, three aspects should be emphasized:

1. The focus on priorities and sustainable cuts rather than the usual salami-slicing with equal budget cuts of all services was highly refreshing. According to research by Utrecht University, this distinguishes the City of Utrecht from many other Dutch cities.  
   
   “There are two contrasting ways to manage fiscal stress. One is to salami-slice budgets top-down and to figure out later how the budget savings can be produced. Another way is to think strategically - to reflect on the purpose and actual performance of the organisation, and to make holistic choices where to cut and where to invest.”

   (Tom Overmans, Utrecht University)

2. Another success factor was to start the review with the positive question “what can we learn from best practice?” It truly opened up new solutions, new policy connections and other fresh thinking rather than just doing what the City of Utrecht has always done, but in a cheaper way.
3. Finally, the way the individual reviews were carried out had added value. Involving local public officers in the review research teams helped to achieve the results within limitations of time and budget. During and after the review, no critical comments were made by administrative and political stakeholders regarding the (loss of) objectivity and independence of the results.