OLASE – The Public Sector FTSE

Back by popular demand following last year, where we at Odgers created an ‘alternative FTSE’ called the Odgers Local Authority Stock Exchange index (OLASE) to show the size and breadth of local government as compared to companies in the FTSE 350.

The interest reached far and wide, we are delighted to again update the list to 2024. This is not an exact science, given the timing of accounts etc. However, it again highlights the scale, profile and complexity of councils and importantly, the skilled executives that run these huge and important organisations.

This year we find 53 councils with income in excess of £1bn of which five received more than £2bn.

There are no doubt a few more, but some of the largest - including Birmingham City Council - are yet to finalise accounts.

We looked at all upper tier English councils and as previously many sit comfortably alongside large scale multinationals which are rightly vaunted yet without the complexity, range (1000’s of service lines) and all-important statutory responsibilities faced by Councils.

Using the OLASE we find Lancashire County Council highest at position 115, given its £2.69bn income, a sum only slightly adrift of Mitchell & Butlers and Berkeley and just ahead of Weir Group and Cranswick.

Five places further down are Leeds City Council at £2.45bn, followed by two other councils, Essex (£2.42bn) and Surrey (£2.39bn), ahead of Severn Trent and Sage group.

This does not of course mean that running a FTSE 350 company and a local authority are the same thing - not least as they former are accountable to shareholders and the latter to local politicians.

It does though mean that people who have held senior roles in local authorities have operated at a high level of sophistication and scale, with responsibility for a range of services and activities far wider than almost any large private sector firm - everything from looking after children in care, building new houses, running leisure centres, to regenerating local communities, the list goes on (and on).

Things are similar among those who work in central government, where more senior civil servants tend to be ‘rotated’ every few years to gain wider experience in different roles.

Budgets handled here can be huge with the Department of Health & Social Care seeing income of £13.45bn - so immediately below Standard Chartered and ahead of Marks & Spencer - and what is now called the Ministry of Housing, Communities & Local Government on £8.5bn, sandwiched between Currys and the London Stock Exchange Group.

We are seeing increasing ‘porosity’ between the private and local and central government sectors as recognition of the transferability of each other’s skill sets increases.

Odgers seeks to promote cross-sector experience, delivering competitive and diverse short lists, and can find private sector talent for local and central government clients, and point public sector officers to private sector roles they might otherwise have not considered.

Local authorities and Whitehall departments are vastly complicated organisations responsible for service delivery both directly to the public - for example through the NHS - and indirectly, such as in the Ministry of Defence.

People who work in these will almost all have engaged with the private sector when procuring goods and services and have gained skills they could put to good use there.

It used to be the case that someone would enter local government or the civil service and spend their whole career there.

That is less true now and ‘porosity’ is working in both directions as each becomes aware not only of the opportunities on ‘the other side of the fence’ but that their experience equips them to grasp them.

If you want to know more about where your Council places within the OLASE or have talent requirements in local and central government and beyond, please do get in touch.