Capita in line for tasty £139m deal across five councils

At this rate, this outsourcer will soon be running all our public services

Outsourcing goliath Capita has been named first in line for a nine-year, £139m deal across five UK councils.

The London-based professional services company has been named preferred bidder in a deal to provide the councils' revenues and benefits, customer services, human resources, IT, and procurement.

If the contract goes ahead it will be simply the latest in a string of public sector wins by the company.

According to research, Capita has increased its share of the public sector IT market by one quarter since 2012, despite overall government IT outsourcing spending remaining flat over that period.

The contract would be between Capita and South Oxfordshire, Vale of White Horse, Hart, Havant and Mendip District Councils. The deal is subject to approval from each of the councils’ cabinets.

Michael Larner, an analyst at TechMarketView, described Capita as having an "unassailable lead" in the UK public sector market.

He said: "The shared service has a good chance of success as the participants have a long history of collaboration."

However, Capita's contract with the Post Office to provide its broadband network did not end so well. The deal came to an abrupt end last year, following reports of underperformance by the outsourcer. ®

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