10 February 2016 | Herpreet Kaur Grewal
The cabinets of five councils have agreed to award a contract to Capita to deliver a range of corporate services including HR, IT and finance, and to Vinci to provide facilities management and property services.
The contracts will collectively save the councils more than £50 million over a nine-year period.
The deal is believed to be the first procurement arrangement of its kind in the UK. There have been examples of councils working together to secure savings through shared contracts, but “this is the first time that a group of councils have looked beyond their neighbours to achieve this”, according to a statement from Havant Borough Council, one of the participating local authorities.
The councils (Hart District Council and Havant Borough Council in Hampshire, Mendip District Council in Somerset, and South Oxfordshire, and the Vale of White Horse District Councils in Oxfordshire) first explored whether they could consolidate their purchasing power into one entity to award contracts to deliver a suite of services in 2014.
This work has now culminated with all of the councils agreeing to award the works to Capita and Vinci.
A Havant Borough Council spokeswoman said: “As well as delivering enormous financial savings at a time when funding streams for local councils are being tightened considerably, the new contracts are expected to improve services for residents.
“The councils will be benefiting from the two companies’ extensive experience across the public and private sectors to continually review and improve services across the organisations.”
In agreeing these deals, the five councils have “broken the mould for outsourcing with this being the first to involve councils from very different parts of the country, proving location is no longer a barrier to achieving savings if partners are committed to joint working and share the same goals”.
“It’s a move that’s being closely observed by central government and many local authorities across the country”, says Havant council.
Councillor Mike Fairhurst, cabinet lead for marketing and development at Havant Borough Council, said: "This is another significant step forward by Havant Borough Council, which, together with the recently announced joint venture with Norse, will go a very long way to ensuring our financial sustainability without the need for cutting our services or raising council tax.
“By working with our like-minded partners we have managed to get far greater efficiencies than we would have achieved on our own, and I am sure other district and borough councils will be following in our footsteps pretty soon.”
Subject to the contracts being signed on 31 March 2016, they’re expected to start in South Oxfordshire and the Vale of White Horse in August 2016, and at the remaining councils between July and October 2017.
The councils will manage the contracts through a new joint monitoring team, which will see staff from across the organisations working together. For the rest of the staff affected it could mean relocating to centres of excellence operated by the two companies in order to improve resilience in service delivery.
The councils and both companies will be providing support, advice, and training to staff throughout the transition to the new contracts.