Manchester City Council has signed a ground-breaking partnership agreement with computer services company ICL and the management consultancy group Deloitte & Touche.
The deal, an alternative to outsourcing, will allow Manchester to draw on private sector expertise to develop its IT strategy without becoming reliant on a single supplier.
The partnership, the first of its type, is being watched closely by other local authorities, and, if successful, could form a blueprint for similar collaborations between the public and private sector elsewhere in the country.
Under the deal, ICL and Deloitte & Touche will review the business processes used by the council, with a view to improving their efficiency and the quality of service offered to the public.
Although IT will underpin the work, the reviews will not be limited to technology and may result in changes generally to the way in which council services are run and managed.
"IT is seen as a key component to effecting change, but the partnership is looking to wider business processes, some of which may be IT related and others may not. IT change will be a key driver but clearly it's not just an IT initiative," said Richard Paver, Manchester City Council's treasurer.
One of the key challenges facing ICL and Deloitte & Touche will be to advise Manchester on the future of its troubled housing benefit IT system.
Implementation problems have led to a backlog of 82,000 items.
The companies will also advise the council how to upgrade its IT and improve the efficiency of its City Works department, which deals with buildings. Reforms are also planned for social services and home care.
The aim is to devise an overall IT strategy for the council that will ensure that new systems can interact together and will allow the council to meet government targets for offering services online.
ICL will advise Manchester how technology can be used to improve its services, and reduce costs, but the council will be under no obligation to take ICL equipment.
Although there is no fixed timeframe for the new partnership, the council anticipates that it will probably last for between five and 10 years.
The project could end earlier if the results are delivered earlier or be extended, if it can deliver further benefits.
The council will assess the success of the partnership on a project-by-project basis. ICL and Deloitte & Touche will be paid according to the degree of risk they take on.