Barnet reconsiders outsourcing links with Capita

24 Jul 18

Barnet Council is to review its strategic partnership with the giant Capita group amid a changing market for outsourcing public services, the council’s cabinet has said.

In a meeting of the council’s policy and resources committee on Thursday, it was proposed that the council should review the contracts it holds with the group.

Barnet approved plans to outsource numerous council services in 2012, claiming that doing so would save £120m over a 10-year period.

But the committee report said: “The environment in which local government is operating has changed since the contracts were let” and added that “the outsourcing market has changed over time”.

Services that are being reviewed include finance, strategic human resources, highways, regeneration, strategic planning and management of the council’s land and property.

The proposals urged that partnerships with Capita should be judged on three areas: delivering high-quality services, securing best value for money for residents, and strengthening the council’s strategic control of services.

Councillors were told to consider three potential outcomes when reviewing contracts, which included: keeping contracts with Capita the same, reshaping them with some services coming back in-house, or scrapping them completely.

The report identified problems with Capita’s service delivery in various areas including: financial controls and reporting, pensions administration, estates, and user satisfaction with back office services.      

The review was called as Capita’s new chief executive set out a new strategic direction for the company.

According to the report: “Capita’s focus in the future will be delivering technology-based services, at scale, where the company believes it can add the most value to service delivery.

“Against the backdrop of these changes, it is timely to take stock of the partnership.”

Richard Cornelius, leader of the council, said: “Our priority is to deliver good quality, value for money services to our residents. Many things are working well and it’s right that we build on them.

“It is important to stress that any changes will only be recommended on the basis that they provide a good deal for the Barnet taxpayer.”

Barry Rawlings, leader of Barnet Labour group, said: “The Capita contracts are failing, and we need to look at whether we can bring their services back in house.”

Jonathan Prew, managing director, Local Public Services, at Capita, said: “The review is an opportunity to respond to changing circumstances and needs that have evolved over the last five years to ensure that a future partnership is focused on providing services that will deliver best value for residents and all stakeholders.”

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