Feeds

Conservative council snubs private sector

Outsourcing is worst option

The essential guide to IT transformation

Walsall Metropolitan Borough Council has opted to keep its struggling benefits services in-house after assessing the outsourcing ventures of other councils and coming to the conclusion that the the private sector was not up to the job.

The council has been wondering what to do with its worst performing departments since January when it ducked out of a £500m "strategic partnership" with Fujitsu at the nth hour.

The move was vindicated by a report presented to Walsall's Conservative Cabinet last week, which said that after a benchmarking study of other councils that had outsourced their benefits departments, Walsall concluded that there were "serious drawbacks" to handing the whole department over to the private sector.

Walsall's benchmarking study found "very few success stories in other local authorities" that outsourced their benefits service.

The benchmark considered 38 other authorities that had outsourced benefits. Eleven of them had ended up bringing the department back in-house.

The study also found that outsourcing would take too long, and the risk that services would degrade or fail during procurement was too high.

In December 2003, when Walsall was given a "weak" rating by the Audit Commission, the council's benefits department had been one of only two to earn three out of four stars. But by 2005, when the Audit Commission commended Walsall for "improving well" its benefits service had deteriorated so much that it was one of only two departments with two stars.

The council had claimed that benefits and other under-performing departments would see improvements once they were farmed out to the private sector, the Audit Commission reported in January.

But within the month, Fujitsu had been given the boot and Conservative Counsel leader Tom Ansell had declared the council did not need help from the private sector.

January's Audit Commission report explained why Walsall's benefits service had declined while most of its other services had improved since 2003. One of the main reasons was the introduction of a new benefits computer system last year. The council had outsourced its benefits IT systems to Northgate in 2004, but the system was delivered late.

A report by the Benefits fraud inspectorate noted yesterday that the new computer system had "created inevitable delays in claims processing", and inundated its walk-in centres with claimants wanting to query their computer-generated allocations.

The council's benefits service was "already strained", reported the BFI. "This situation was made worse when the council restructured its Revenues and Benefits service at the same time," it said.

The computer system should, however, help pull the department out of its mire, reported the BFI. If only it could train its staff to use it properly.

Walsall still felt the need for some scheme to replace its aborted strategic partnership with Fujitsu. After seeing the benchmarking study that rubbished the private sector, the council's Cabinet considered three other options: do nothing; develop shared services with other councils; or go for a "mixed economy" model in which core services were kept in-house and non-essential support services where outsourced.

It ruled out a joint services agreement with another local authority because of the difficulty in finding a good fit in good time. Doing nothing was never really an option.

The cabinet voted for the "mixed economy" method, which would require an investment of £400,000.

It did, however, note that it would not be an easy ride. "Can the council manage the potentially complex mix of internal core service activities and the externalised non-core activities?" a report to cabinet asked. In light of the problems caused by handing responsibility for its benefits IT systems over to Northgate, this was clearly a pertinent question.®

Build a business case: developing custom apps

More from The Register

next story
Hello, police, El Reg here. Are we a bunch of terrorists now?
Do Brits risk arrest for watching beheading video nasty? We asked the fuzz
UK fuzz want PINCODES on ALL mobile phones
Met Police calls for mandatory passwords on all new mobes
Munich considers dumping Linux for ... GULP ... Windows!
Give a penguinista a hug, the Outlook's not good for open source's poster child
EU justice chief blasts Google on 'right to be forgotten'
Don't pretend it's a freedom of speech issue – interim commish
Detroit losing MILLIONS because it buys CHEAP BATTERIES – report
Man at hardware store was right: name brands DO last longer
Snowden on NSA's MonsterMind TERROR: It may trigger cyberwar
Plus: Syria's internet going down? That was a US cock-up
UK government accused of hiding TRUTH about Universal Credit fiasco
'Reset rating keeps secrets on one-dole-to-rule-them-all plan', say MPs
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
e-Borders fiasco: Brits stung for £224m after US IT giant sues UK govt
Defeat to Raytheon branded 'catastrophic result'
Yes, but what are your plans if a DRAGON attacks?
Local UK gov outs most ridiculous FoI requests...
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.