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Council workers in Barnet were paid less than they should have been due to a problem with the IT system used by the local authority’s business process services supplier, Capita.
Around 170 members of staff were automatically enrolled onto a pension scheme and were underpaid as a result.
A Capita spokesperson said: “A technical error led to extra deductions being taken from a number of employees on Tuesday. This was flagged immediately and refunds were made last Friday. We apologise to those affected.”
The Capita outsourcing contract with Barnet Council has been controversial even before its inception in 2013. Labour councillor in Barnet, Alison Moore, said: “This is yet another shambles by Capita. Labour members successfully pressed for an apology to be sent to the affected staff, [and] that no staff would be out-of-pocket and Capita would bear any additional costs, but we have no faith in Capita systems whatsoever.
“As the meeting revealed, there appears to be severe weaknesses in their ability to test those systems before they install and operate them.”
The council signed a 10-year contract, worth £32m a year, with the outsourcing giant in 2013, which saw IT and back-office functions such as human resources (HR) and payroll transferred to Capita as part of the council’s One Barnet programme.
There have been concerns over the quality of delivery, with a 2018 report recommending that HR and finance services, currently provided by Capita, are brought back in house.
In 2018, Conservative Richard Cornelius, who was Barnet Council leader at the time, admitted that while parts of the outsourcing deal have saved “millions of pounds a year, there are some services which have not been up to scratch”.
Read more about Barnet Council’s outsourcing
- Barnet Council is planning to bring parts of its Capita outsourcing deal back in house, and expects the supplier to pay the council £4.12m due to delivery issues with some areas of the contract.
- The internal audit reports show a series of failings by supplier Capita, such as “no documented IT disaster recovery plans” and gaps in change management processes.
- The second most senior judge in England and Wales will hear a legal challenge against Barnet Council’s outsourcing programme.