Comment

BRUM SPLASHES OUT £20MILLION – TO SAVE CASH

25-01-2008

Consultants hired to slash costs at Birmingham City Council have cost £20 million over the last two years - and the spending will go on. But although the figures are enormous they must be balanced against the savings ushered in by the Council’s new Business Transformation Plan designed to cut spending by £600 million.

Credit must be given in the first place to the Birmingham Post which obtained the details under Freedom of Information. They certainly make for a good headline, and prompt fears that the local authority is being taken for a ride corporate freeloaders.

The Stirrer Forum has been abuzz with suggestions that employees of the various Capita offshoots who’ve been running projects in Brum have been living the high life, travelling first class and staying in fancy hotels like the Malmaison.

Unfortunately, a breakdown of the spending isn’t available, making it difficult for ordinary councillors – never mind members of the public – to assess whether we are truly getting value for money.

Greater transparency is essential - and until we have it, the consultants will remain a convenient scapegoat, especially now that the unions and rank and file workers are struggling with the impact of Single Status.

It must be galling enough to find out you're having a pay cut -but to be told that pampered outsiders are coming in and earning more in a day than you do in a week only fans the flames of injustice.

Yet the bigger picture for council taxpayers is that Business Transformation – the programme Capita are responsible for implementing – is designed to massively reduce spending over the next ten years.

On the face of it, laying out out £20 million to save £600 million sounds like a sensible investment.

Unfortunately, we also know that as Capita has been named the city’s “strategic partner”, the spending won’t stop there.

The Post reports that Service Birmingham, set up to improve the Council’s IT will divert a further £142 million to the company in the next ten years, justified again on the basis that the savings accrued will amount to £280 million.

In the meantime, the private contractor will benefit from the secondment of 500 Council employees, whose skills and talents will be based at their disposal.

It begs the question of whether Birmingham – from among its vast army of 40,000 employees – already had the know-how at its disposal to transform itself, without lavishing millions of taxpayers cash on outside experts.

Does Birmingham need Capita?

Are consultants an easy scapegoat?

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