Tuesday, 1 November 2011

Barnet Outsourcing - What a legal mess

Today, every single Conservative councillor in Barnet should today be very very worried. Over the weekend certain documents have been leaked to the Barnet Bloggers which illustrate what a complete and utter legal minefield the One Barnet programme has become. You can read some of the extracts at the Barnet Futureshape Blog but trust me, there is much more and it is much worse.

The documents set out quite clearly just what a dangerous game the One Barnet protagonists are playing. Some of the roles within departments currently in the process of being outsourced cannot be carried out by anyone other than an employee of the council because they are statutory roles. Problem for the companies bidding? Oh no. To get round this problem the Council have spent a great deal of money getting their lawyers to come up ways around this legal duty.

The documents also reveal that the council don’t mind jobs being outsourced away from Barnet, either elsewhere in this country or overseas. It states that “The Council do not require services to be located locally except where the service specification demands it. The Council will consider both off-shoring and near shoring proposals”. In other words unless jobs have to physically be carried out here in Barnet then the council don’t mind if they are dealt with in India or the Philippines. I think this nails once and for all the garbage that has been put out by the council, especially Councillor Thomas when he said outsourcing is just about whose name goes on your payslip. Lies. Jobs will be shipped overseas if it is cheaper to do so. Given that the Council is one of the largest employers in the borough (along with the NHS), that doesn’t bode well for council employees and all the local shops and businesses where they spend their salaries.

The risks associated with this programme seem completely out of proportion to the potential savings the scheme might make. Just a few listed in these documents include:

- Risk of contract failure – the council are sufficiently worried that they are considering taking out insurance against the risk of failure, a cost which I doubt has been included in the incredibly flimsy business case previously submitted.

- Risk that if offered a long contract, the outsourcing companies “enthusiasm and commitment will wane” – so what are they doing, yes offering a long contract (10 years)with an option to extend for a further five years.

- In terms of pensions “there are risks of potential large deficits being built up by the new employer during the contract period”. And the response? “A recovery plan will need to be put in place well before contract ceases”. So the private company will get all the benefits and local ratepayers will have to pick up the bill at the end of it.

The list goes on and on. If there was a track record of these mega outsourcing deals going well one might consider the risk worthwhile but given the huge problems at Southwest One and the recent decision in Suffolk to scrap mass outsourcing, I would have thought that any rational, sane and business like person would have taken a step back to reconsider their strategy. And therein lies the rub. This isn't a business decison it is purely political. Private sector good public sector bad. Perhaps that is why they have not allowed the in house teams to bid for any of these contracts.

Barnet Council is at a tipping point. If they persist with this mass outsourcing strategy I think councillors could find themselves accused of breaching their fiduciary responsibilities. And don’t let them say this is all about saving money because I don’t believe it and more to the point no one has yet provided a single shred of reliable,sourced and validated evidence that it will. Yes we have lots of opinions and assumptions but where is the hard evidence – there isn’t any. Worse, the consultants’ bills for One Barnet continue to clock up. In September alone Agilisys, the Council’s implementation partner for One Barnet, billed £84,292. That’s a run rate of £1 million a year for just one consultancy firm let alone all the other consultants and lawyers providing advice on One Barnet. Just stopping all of that waste would save millions overnight.

Councillors, you may have been told that One Barnet was the answer to all your problems but it isn’t and if you aren’t careful it could end up costing Barnet residents millions because it is us ultimately who have to bail you out when things go wrong. Read these documents very carefully, ask difficult questions because it strike me that no one has been asking the right (or any) questions up to now. Failure to do so could cost ratepayers a fortune and you your seats at the next election.


  1. Stupid council slogan

    "Putting the community first".

    Bangalore not Barnet they mean.

  2. Being put first are the best interests of senior officers and the outsourcing companies who are standing by waiting to milk this borough dry.

    This is the unpalatable truth, and we all know it.