09 November 2018
In a period of continued austerity, a number of fire and rescue authorities (FRA) have looked to create a fire trading company (FTC) to exploit the skill sets of the Fire and Rescue Service in an attempt to combat funding challenges.
FTCs first appeared in 2004, but many FRAs were unable to trade until a change in legislation under the 2011 Localism Act. Despite the revised legislation, numbers remain low with just 15 out of 48 FRAs operating an FTC today. When FTCs are successful (i.e. financially viable), they can not only give an income to the parent FRA but potentially provide social value and wider benefit to their communities (through local projects and charities etc.).
The FIA had received a number of complaints over recent years from its members (and non-members) about what they saw as unfair competition from some of these FTCs in the commercial arena. The FIA decided the best course of action in fairness to all was to instigate an independent review (with a completely “hands off” approach) that would result in a guidance document. The independence of the document was paramount therefore Grant Thornton was jointly commissioned by the FIA and the National Fire Chiefs Council (NFCC), with input from FTCs across the country contributing to its development.
The FIA chose Grant Thornton as they are well respected as the world's sixth largest professional services network of independent accounting and consulting member firms who provide assurance, tax and advisory services to privately held businesses, public interest entities, and public sector entities and have experience in other UK Government guidance documents (specifically in the running of trading arms of public entities).
The report aims to provide good practice guidance based on research into FTCs, to understand how they operate (such as the use of uniformed officers, pay, pensions, overhead calculations etc.) and explore the reasons for their success or otherwise. It also provides guidance for FTCs currently operating and for fire and rescue authorities considering setting one up. Click below to read the report.Creating and operating a successful Fire Trading Company
The FIA would like to thank Grant Thornton as what we see as an excellent piece of work, the NFCC for their support and work in adding credibility to the independence of the guidance document and the FTCs for their time in contributing to this document.