Barnet Council has decided to terminate its outsourcing deals with Capita, but to leave IT, customer services and revenues and benefits under the company’s control until 2026.
Its policy and resources committee voted on the move earlier this week, deciding to return most frontline services to direct control of the council next year.
But they made exceptions of IT and the other two services, extending the arrangements with Capita until 2026, saying they would be too complicated to insource in the shorter period.
Outsourcing contracts with Capita for services such as HR, finance and estates, were awarded in 2013. Barnet also went into a partnership with the company, forming the Regional Enterprise operation, to run services including highways, planning, regeneration and development and environmental health.
Since then control of the council has changed from Conservative to Labour.
Leader of the council Cllr Barry Rawlings said: “This is the first major step we have taken to bring privatised services back in-house and shows our commitment to providing value for money for all our residents.
“Most of the services outsourced by the previous administration will be back under direct council control by next year. The decision to run services in-house will save Barnet’s council taxpayers money and return 370 staff to direct employment by the council. The remaining Capita contract, CSG, will close by 2026, before the end of our administration’s first term.”
He added: “HR and finance will be extended for just 12 months, however, IT, customer services and revenues and benefits are more complicated to bring back straight away and doing so would cost council taxpayers £2.6m each year, which would result in redundancies and cuts to services.
“Instead, the council will extend the contract for these services until March 2026, which will provide a saving of £254,000 and allow the council more time to make arrangements for the future of these services in the shortest timeframe.”
A Capita spokesperson said: “We look forward to working with the council to deliver services through Regional Enterprise up until September 2023. The extension on other services will see us build on our track record of delivery and save Barnet Council £254,000 as well as preventing £2.6 million in additional costs per year.”