More Focus on Income Generation

Example.  Staff member costs £35k to employ.  Staff member rerealisessponsible for income generation and achieves over £70k in income.  Council £35k to the good.

Staff member resigns and post is not filled.  Saving of £35k in wages but you lose opportunity to realise £70k income. Council £35k worse off. Add to this the cost of additional management to achieve this (£45k) and the council appears to be £80k worse off.

As well as reducing costs the council must consider the consequences on its revenue. Where staff leave and post is not filled the council incur a net loss.  Income generating functions should be consulted to identify whether additional staff or other resource can increase income to a level which is greater than the cost of the staff or other resource.  In other words speculate to accumulate. 

Please consider what services can provide these financial benefits before further cuts are made to their budgets.  This is particulary important where recurring fees are due such as under licensing or registration regimes as well as debt management (recovery) functions.

Why the contribution is important

Whilst reducing costs is vital there is an opportunity to invest in staff and effectively 'make a profit'.  If the consequence of reducing costs is that you are worse off then surely you must reconsider this position.  As mentioned above - speculate to accumulate.

by zakibhoy on January 27, 2016 at 10:16PM

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