Council £230m privatisation deal on table
Jul 31 2008 by Ben Schofield, Liverpool Daily Post
A £230m privatisation scheme of a council’s services will be given the final go-ahead tonight.
Sefton’s councillors are being urged to agree plans to bring private companies in to run the borough’s finance and technical services departments.
The move should help save £1m over the current financial year and will deliver further savings over the course of the 10-year contracts.
Confidential internal reports seen by the Daily Post reveal global finance giant Arvato will be paid £172.4m to run the council’s finances for the next decade.
Their bid slashed £19.4m – 10.1% – off the cost of Sefton running the department in-house.
The German firm say they will make a £4.1m capital investment in the department, almost 90% of which will be sunk into IT enhancements.
They have also committed to delivering all the services from Bootle and will base their new business line “Arvato Government Consultancy Services” there, creating 200 jobs.
Arvato say there will be no compulsory redundancies without the council’s consent and employees will continue to work under the same terms and conditions.
UK-based Capita Symonds have told Sefton it will cost £64.99m for them to deliver the borough’s technical services for 10 years.
That represents a £3.8m, or 5.5%, saving compared to Sefton’s predicted costs.
They said they would invest £7.39m in people, processes, new technology and the community.
They say they will create 100 new jobs within five years and 250 jobs over the duration of the partnership.
The engineering giant guarantees there will be no compulsory redundancies.
In the report, Sefton’s chief executive Graham Haywood writes: “Clearly, the benefits of the project are very much in keeping with the council’s efficiency strategy, improvement strategy and overall corporate plan, in that the project will directly fulfil the council’s objective of securing more efficient and cost-effective services for the residents of Sefton.
“In addition, the injection of new capital investment, the retention of work within the borough and the guarantee of job security all directly align with the council’s objective of promoting the economic development of Sefton.”
Councillors are told in the report the so-called “major services review” is necessary to keep council tax rises low.
The current privatisation, added to the termination of service level agreements with One Vision Housing and Sefton New Directions, will mean up to 1,700 fewer staff are directly employed by the council.
That change, the report adds, will be reflected when the personnel department is reduced in size, including the retirement of an existing director.
A further saving will also be made when the assistant chief executive posts for strategy and performance merge into a single post for management. The incumbents of both original posts are taking voluntary early retirement.
Cllr Tony Robertson, the Liberal Democrat leader of Sefton Council, said: “We’re hopeful of a completely seamless transfer.”
Share
