New inquiry into city’s BT contract

Jun 30 2008 by David Bartlett, Liverpool Daily Post

LIVERPOOL council’s joint venture with BT –which is said to “lack transparency” – is to be scrutinised by a select committee of councillors.

A special meeting of the Corporate Services Select Committee will convene in September to look into how the £70m-a-year Liverpool Direct Ltd (LDL) partnership is working.

LDL chief executive David McElhinney and other senior officials are expected to be requested to appear before the committee.

Last week, the Daily Post revealed the findings of a report by the Improvement and Development Agency for Local Government (IDeA) which said the basis of billing for the contract was “opaque” and that the “lack of transparency” has raised doubts about whether the council is getting value for money.

LDL runs the council’s revenues and benefits, and customer services, as well as its information technology. In the last financial year, BT charged £31m in management fees, while the council’s expenses as part of the joint venture were £36m, and the IDeA report has prompted fears the local authority is being “ripped-off”.

The special meeting was called in response to a separate internal council report which raised questions about the performance of LDL.

However, councillors will also been keen to question LDL’s management about the contents of the IDeA report.

The IDeA report made a number of criticisms of the LDL deal, stating that high costs for benefits administration and revenue collection services “indicate that the spirit of the partnership is not working to the advantage of Liverpool City Council”.

The report’s author urged the council to carry out an immediate and urgent review of the contract, that runs until 2017, and which could cost as much as £20m to end early.

Last night, a council spokesman confirmed the special meeting would be taking place, but said a date in September was yet to be set.

Deputy Labour leader Cllr Paul Brant, who requested the meeting, said: “A detailed and thorough scrutiny of the senior LDL executives is essential following the recent revelations.

“Liverpool is officially the worst financially managed council in the country, and it is essential that these vital services provided by LDL are clearly shown to be good value for money.”

davidbartlett