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Birmingham City Council ends 13-year IT contract with Capita

Local authority to bring IT services in-house, saying “the time is right to transfer the services back to the council”

Birmingham City Council has ended its longstanding IT and HR services contract with Capita, bringing most services under internal control.

Council services have been insourced after a four-month transition period. Capita will continue to provide some services, however, including datacentre hosting.

It was back in December 2005 that the council chose Capita as its strategic partner to support business transformation and IT.

Service Birmingham was set up by Capita, which signed a 10-year, £475m contract in April 2006 to deliver IT transformation.

The council will now bring 147 of its staff back from Capita, and a further 167 will be transferred from the supplier to the council.

Birmingham City Council said in a statement: “Both organisations recognise that the change to this working arrangement is timely and appropriate. The original contract was awarded in 2006 and, after 13 years, the time is right to transfer the services back to the council.

“The council now has a well-developed digital strategy that seeks to transform the IT service provision to deliver new customer-centric outcomes.”

IT services management company Rainmaker Solutions has been signed up to support the council’s insourcing project. It will work with the council on a programme called Shaping The Future.

Capita’s contract with the council has not been without controversy. In 2013, reports claimed that councillors had little idea how much the arrangement was costing.

According to the Birmingham Mail at the time, councillor John Clancy said council members were being “deterred from getting a grip” on the nuts and bolts of the “complex” deal because the facts were unclear.

“Nowhere is there a clear total figure for what we are paying and what we should be paying,” he was reported as saying. “The biggest issue is transparency – we have little idea of what is going on.”

Read more about the Service Birmingham contract

  • Birmingham City Council is planning to offshore 100 jobs to India as part of an HR and IT services joint venture with Capita.
  • Birmingham City Council’s joint venture with Capita is re-evaluating its plan to offshore IT jobs after a public backlash to news of the plan.
  • Birmingham City Council has agreed to a £300m contract extension to its Service Birmingham joint venture with Capita.

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