Monday, 5 May 2014
Transformation Programme - Press Release for UNISON Lobby of 6th May Council Meeting
UNISON has some serious concerns about the proposal to transfer more jobs and services to a private company who have failed to deliver the savings they promised. In 2010, when the council awarded the contract, the cost of Support Services was £10.3 million and Agilisys promised to reduce that cost to £8.5 million by 2014. But current costs are now £10.6 million - that's £2 million a year above what Agilisys promised. At the same time Agilisys' accounts show that since being awarded the contract their profits have increased and in 2013 they paid a £7 million dividend to their share holders - part of this is North Somerset council taxpayers money. The residents of North Somerset may well then think that the council ought to be looking to terminate this contract, which has quite plainly failed to reduce costs. But rather than terminate the contract they are now planning to give Agilisys even more jobs and services and extend their contract to 15 years. We think that this is bad news for the council and bad news for council taxpayers.
For UNISON there are a number of problems with contracting out services. A contract effectively ringfences a part of the council's budget and makes it untouchable. Any changes that need to be made to service delivery involve renegotiating the contract, which also involves a cost to the council. The council have to spend a lot of time and money monitoring contracts, when that money would be better spent on delivering services. When services are transferred outside the council, all capacity and knowledge goes with the staff who run those services, weakening the council and making it less resilient for the future as a result. Councillors lose all control over contracted out services, although still retain the legal responsibility for those services. If anything goes wrong with contracted out services it is North Somerset Council who face court proceedings, it is the council whose reputation suffers, and it will be councillors who will ultimately feel the impact at the ballot box.
The proposal to extend the contract with Agilisys is part of the council’s recently announced Transformation Programme, which is their response to further central government funding cuts. North Somerset Council have already made about £50 million of cuts since 2010 and are planning an equivalent amount up to 2018. The council are arguing that if they give Agilisys more services and extend the contract by another 5 years that Agilisys will deliver greater savings for them. But realistically the only way Agilisys are going to be able to do this, and still make a profit, is to reduce the numbers of staff delivering services, reduce staff pay and conditions, and reduce the quality of services. When Agilisys first took on the contract in 2010 they were very quick to make redundancies, particularly in ICT and the Contact Centre. We also have a situation in the Contact Centre where council staff who transferred to Agilisys get one rate of pay, and new Agilisys starters get another much lower rate of pay – this two tier system is not good for staff morale and as a result is not good for services.
The jobs and services which they are now proposing to transfer are administrative and front office roles – these staff are the backbone of the council - anyone who has ever worked in any sort of office environment knows how crucial admin staff are. Their work is essential in order to allow frontline staff such as social workers to do their jobs. They are often the main point of contact for North Somerset residents, and have a huge knowledge of council services and procedures. They are the cogs that keep council departments running smoothly. If you transfer the cogs, the council machine will grind to a halt.
It is UNISON’s view that rather than transfer services to a private company, who will have to make some sort of profit for themselves, that we keep services in house and look at what we can do to make changes internally, thereby keeping all the savings for ourselves to invest in services. We also think that the council can manage any job losses through voluntary redundancy, retirement, redeployment and re-training for staff.
We will be lobbying councillors on 6th May from 5.30 pm and also speaking at the council meeting. We will urge councillors to amend the report they are debating by including a requirement for an in-house service improvement plan, which at the very least will act as a comparator to Agilisys' offer and therefore ensure value for money for the council. But it is also our view that an in-house plan will show councillors the benefits of keeping services within the council, which include ensuring that capacity and expertise is kept in the council, that limited resources are focused on delivering services, rather than monitoring contracts, that risk is minimised, and that the council has maximum control and flexibility over services.