The five-year managed services contract will see a consortium led by services specialist Netstore replace Hackney's existing Oracle system, which is no longer supported. Under the terms of the agreement, Hackney will get a new financial reporting suite and a specialist revenue allocation system.
Other parts of the deal include the provision of a managed Bacs payment and cheque production system and integration with other systems. The initial implementation will take 10 months, and the project is due to go live on 1 April next year.
Hackney hit the headlines in 2001 following the termination of its £70m council tax and housing benefit contract with ITNet. The council took the service back in-house after a catalogue of problems emerged. These included a backlog of 17,000 housing benefit cases, according to an Audit Commission report.
However, the council has made major performance improvements over the past two years, according to Samantha Lloyd, Hackney's council cabinet member for resources.
She said, "Since bringing the service back in-house, we are very pleased with the progress we have made."
For the second year running, Hackney has been named the most improved council in Britain for council tax collection, Lloyd added.