Vibrant places

Income generation - critical success factors

Local authorities have opportunities to generate additional income in many ways. However, understanding the needs of the area and the capabilities of their authority to ensure they select the most suitable option is key.

Elements for local authorities to consider before and during adoption of the new delivery models or funding mechanisms include:

  • exploring all of the options to maximise use of revenue and assets
  • understanding strengths and areas where they are not as strong compared to the market place
  • understanding how each department and service compares to neighbours and peers in terms of net income and cost recovery
  • establishing adequate gateway processes to identify and select new opportunities, and stretch or stop existing ones
  • identifying how generating income will deliver both a financial and social return aligning with the area’s priorities
  • staying informed on innovative financing to fund any new income generation proposals
  • ensuring the governance process is robust enough to scrutinise business case proposals
  • understanding the pros and cons of the different alternative delivery models as well as the different aspects such as HR, legal and tax.

A key part of successfully implementing change is ensuring the authorities' culture is ready for change. Successful leadership teams must continually demonstrate new acumen relating to income generation, both in terms of entrepreneurship and collaboration.

A council’s income generation strategy and action plan should factor in organisational and personnel development needs, equipping them to realign its operating model to any new vision.

Read 'The Income Spectrum' for case studies showing examples of success and authorities that have fostered innovation, and a checklist of questions to help maximise authorities’ chances of income generation. 

Commercial healthcheck in local authorities

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Income generation report: