Richmond and Wandsworth councils will benefit from a £3m Government grant to create their shared staffing arrangement.

The two councils announced earlier this year they would share a chief executive from 2017, after the retirement of Richmond’s chief executive Gillian Norton in summer 2016.

Both councils will be led by Paul Martin, current chief executive of Wandsworth Council, and will share directors for resources, environment and community services, housing and regeneration and education and social services.

There will also be a director of Richmond’s children’s services, which is shared between Richmond and Kingston.

The £3m grant comes from the Transformation Challenge Awards, which supports innovations that improve and protect public services and reduce costs to taxpayers.

A large portion of the money will be used for up-front investments, including joining up ICT services across the two councils.

The remainder will be shared between joint services between Richmond, Sutton, Kingston and Merton councils, including legal services and audit services.

The money was due to be awarded to Kingston and Richmond councils under the Thames Agreement, but was transferred to Richmond and Wandsworth.

Ravi Govindia, leader of Wandsworth Council, said: "I’m pleased the Government has recognised the significant benefits and savings our staff sharing proposal represents.

"Our approach is designed to preserve the unique identify and values of each council while eliminating duplication in how services are managed and run across the two boroughs."

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Lord True, leader of Richmond Council, said he was pleased to see the councils’ vision recognised "so generously" at the highest level.

The shared staffing arrangement is expected to save taxpayers in Wandsworth and Richmond up to £10m-a-year and both councils will continue as separate sovereign bodies with their own elected councillors, cabinets and leaders.