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From January 2016, Liberata will deliver a range of services for the council, including IT, revenue, debt management, customer services, payroll and human resources (HR) systems.
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In a bit to cut spending, the council hopes the contract will save 19%, or £8m, by transferring services to the outsourcing company.
The deal includes a £4.9m inward investment in IT, which will involve the development of a “service hub”, as well as creating more than 100 “good quality new jobs” in Burnley over the first five years of the contract.
Council leader Mark Townsend said the deal brings opportunities for growth “at a time of government austerity measures”.
“We are taking this step to respond positively to the challenges that we face. Burnley Council is acting in line with its responsibility to provide the best possible services to residents, in spite of major reductions to our funding,” he said.
Liberata will act as strategic partner, but the council still remains responsible for the services, Townsend added.
Like most local government organisations, Burnley is facing big financial challenges, and the council aims to save a minimum of £2m over the next two years out of its annual budget of £16m.
“Since 2010, the council has taken a range of steps to protect key services, as well as dealing with the financial situation. We have made significant job cuts,” said Townsend.
“Bringing in a strategic partner is a new approach, which will make the council look and feel radically different.”
He added that the council will be improving the way people access its services and improve online interactions.