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Public-private shoe-in wins Birmingham contract

Capita's second foothold in Europe's largest council

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Birmingham Council has handed the second raft of its 10 year transformation programme over to a public-private vehicle that is majority owned by Capita.

Capita said in a statement to the City yesterday that Service Birmingham, its joint venture with Birmingham City Council, had been given a budget of £142m over 10 years to manage the "transformation" of the council's customer services.

Service Birmingham was approved as the first-dibs supplier on four of nine planned transformation projects planned at the council a year ago. The four projects were estimated to net the joint venture £452m. Corporate Services transformation, the first, has already been approved.

The joint venture's business proposal for the customer services transformation was approved by the council on 26 April.

The council is given a chance to refuse Service Birmingham permission to handle any one of the four transformations at the business proposal stage in order to ensure that the arrangements remain price competitive. However, the business plans are drawn up by a project team that includes council officers, Service Birmingham, and one member of the council cabinet.

Birmingham is waiting for a new Cabinet to be agreed following the council elections.

Glyn Evans, assistant to the chief executive of Birmingham Council on transformation, said the arrangement was good for the council.

"We are confident that what is being imposed is what the council wants," he said.

"Our model is to have joint project teams - I've always agreed that transformation isn't something that can be done to the council, we've got to take responsibility for it," he added.

He said the customer services project cost of £142m was in line with the the proportion of the total transformation £452m budget that was agreed last year. Any budget over-runs would have required approval by the Cabinet. ®

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