The row centres on the council's review of IT and related services. Officials are discussing a number of options, including the creation of an IT joint venture company and a 10-year strategic partnership with private sector partners.
Public sector union Unison is calling on the council to rule out the transfer of 550 staff to a private company. Union officials are warning that the possible transfer of staff into a privately controlled organisation could lead to job cuts and a deterioration of services.
Kenny Bell, secretary of Unison's Newcastle City Branch, confirmed that the 550 staff will be taking strike action on 28 September. He expects Newcastle City Council's 5,500 other Unison members to support their colleagues. "The authority should select a supplier on the basis of direct employment or secondment [for council employees] not staff transfer," he said.
Union officials have compared the planned industrial action to a "general strike", with education the only service not to be affected.
Doug Johnson, director of strategic support at Newcastle City Council, said, "It is very disappointing that Unison members have chosen to take this premature action." The council is still exploring its options and there are no firm proposals on the table yet, he added.
The council has already stated its desire to improve IT through a strategic partnership of up to 10 years with private sector partners. "We have clearly stated that our preferred option is to retain direct employment of staff, possibly through a joint venture company," said Johnson.
Unison has also expressed serious concerns that the private sector will control the new body. Bell claims the council will own less than a 20% stake in the joint venture company.
Richard Sykes, chairman of outsourcing specialist Morgan Chambers, believes the row is unlikely to cast a shadow over the growing trend for IT joint ventures between the public and private sectors. "My feeling is that people should be more relaxed about the nature of the changes here," he said. A professional venture can provide a more positive working and career development environment for IT professionals, he added.
Earlier this year, Liverpool City Council entered into a 10-year, £300m deal with BT which saw the company take control of the UK's largest local authority call centre and IT services.
However, the history of local government IT has its share of failed private sector partnerships. Gloucester City Council re-tendered the UK's largest facilities management contract, a 24-year deal signed with CFM in 1990, after just six years after auditors' concerns that the council was paying too much.