A Reform-run Derbyshire council is set to spend £5 million on hiring private companies to investigate how it can save millions of pounds, including potential job cuts.
Derbyshire County Council, run by Reform UK, is set to spend £5 million on assessing potential changes which can be made to its operating model and a “large-scale transformation programme”.
Through this £5 million it is hoped that private firms, required due to the council’s own lack of resource and expertise, can find between £19.2 million and £38.7 million in savings.
This will include “quantifying FTE (full-time equivalent) efficiencies.
Over the past three years alone, the county council has used £132.4 million from its rainy day reserves in order to reach balanced budgets, with the authority currently overseeing an annual spending budget of £770 million.
Council officials acknowledge the timing for a costly “transformation” may not seem right due to impending local government reorganisation – through which the county council will be scrapped, merged and readopted as either one or new councils – but they said efficiencies needed to be looked at now for a better long-term future.
The council said: “Retaining the current model does not achieve the level of efficiency required to operate within the council’s financial constraints.
“Postponing transformation risks exacerbating financial pressures and missing critical opportunities to enhance service delivery.
“Undertaking transformation now will ensure the council is well-positioned to manage the transition and respond effectively to the outcomes of local government reorganisation.
“Investing in transformation now would enable the council to begin realising benefits immediately – financially, operationally, and in terms of service quality.
“It would also position the organisation on a stronger, more sustainable footing ahead of local government reorganisation.
“While further redesign of the operating model may be required post-2028, this is likely to be on a smaller scale, building on the foundational learning, infrastructure, and cultural shift already in place.”
Council officers say that the “do nothing” approach “is unsustainable due to ongoing overspending, high operating costs, and a larger-than-average workforce”.
They write: “It would fail to address the structural financial challenges and would risk further depletion of reserves without resolving underlying inefficiencies.”
The report, published by the council last month, details that a recent survey showed just 39 per cent of residents were satisfied with how the authority is run – below the target of 56 per cent set by the Local Government Association.
In January, prior to the now former Conservative administration’s defeat to Reform UK in May’s local elections, Councillor Simon Spencer, then deputy leader, had said the county council costs four times more to run than similar-sized councils, dubbing that “unsustainable”.
The Conservative administration had outlined up to £20 million in savings by cutting from its burgeoning spend on support staff, which make up 2,600 of its 12,000 workforce.
Since then Cllr Alan Graves, the council’s Reform leader, has said he aims to cut 2,000 staff from the council.
When the £5 million spend on external consultants to find savings was announced, Cllr Alex Dale, Conservative opposition group leader, said: “I welcome the progress on the redesign of the Council’s operating model, initiated under the last Conservative administration.”
He questioned whether this would include a “payments by results” model “to ensure delivery of the intended savings before parting with any of the taxpayer’s money”.
Cllr Anne Clarke, Labour’s group leader, asked if the Reform leadership were confident that the potential savings could be made, due to the large range between the £19.2 million and £38.7 million figures.
Reform has recently argued that the authority is now in a much-improved financial position with a £1.3 million overspend currently predicted, though warning “we are not out of the woods” and that “significant challenges lie ahead”.
The council’s reserves are set to fall to £34.2 million, with finance officials recommending the authority cannot drop lower than £25 million, having spent around £50 million per year for the past three years from its rainy day fund.
Cllr John Lawson, Reform UK’s cabinet member for council efficiency and DOGE (department of government efficiency), confirmed payments would only be released to the contracted firms when key milestones were met.
He said: “The redesign of the council’s operating model is a significant undertaking, and share the view that ensuring value for money is paramount—particularly when engaging external partners at a substantial cost.
“The potential benefits outlined in the cabinet report – ranging from £19.2 million to £38.7million – reflect a prudent and transparent approach to forecasting, acknowledging both the complexity and scale of the transformation programme.
“The range represents different scenarios: the lower end is based on conservative assumptions, while the upper end reflects more ambitious but still achievable outcomes.
“This approach ensures we are not overstating the benefits, while also recognising the full potential of the programme if key enablers—such as technology adoption, process redesign, and cultural change—are successfully delivered.
“Importantly, more accurate and detailed benefits will be identified and validated during the ‘design’ phase of the programme.
“This phased approach allows the council to refine its assumptions and projections based on real data and insights, which in turn helps to de-risk the overall benefits estimation and ensures that subsequent implementation is grounded in evidence.”
