City mess that needs sorting

Jun 27 2008 by Alison Gow, Liverpool Daily Post

THE relationship between Liverpool city council and Liverpool Direct Ltd is today under the spotlight. A new independent report, the findings of which are revealed by the Daily Post, is bound to spark yet more debates over the rights and wrongs of this partnership.

And open debate is clearly something that is urgently needed. The report, by the Improvement and Development Agency for Local Government, finds the basis of billing for the £70m-a-year LDL contract is “opaque”, criticising the “lack of transparency”. An internal council audit has also revealed problems with the contract.

So, given the IDeA’s concerns, just how do we know if the council – and, by extension, the taxpayer – is getting value for money?

The simple answer is, we cannot. The council has been ordered to carry out an immediate and urgent review of the contract, which may go some way to illuminating this matter. But, even then, extracting itself from this deal could cost the local authority as much as £20m.

How has the city council managed to become so embroiled in such complex contractual wrangling? Just who understands exactly how this partnership operates?

Why are £15m of additional services being invoiced to council departments, when – as the report states – it is not clear what these charges are for and what the current arrangement is compared to the original contract?

LDL was set up in 2001 to improve the council’s customer services department.

It has since expanded its remit into other areas of the authority including information technology, human resources and revenues and benefits.

But, right now, this entire set-up is an embarrassing mess for Liverpool council.

Investigators have raised their concerns; now it is up to both the local authority and its partner to prove they are able to sort out the mess, in an open and transparent way.