Capita has been awarded a contract extension to provide services including IT to Barnet Council, as the local authority moves services back in-house.
The deal to deliver back office services such as HR and finance, as well as deliver IT, could be worth up to £57m.
In July, the London Borough Council announced it was ending its outsourcing contract with Capita, originally signed in 2013, in 2026. This followed members of the council’s policy and resources committee voting in favour of ending the contract.
It was originally known as the One Barnet programme, and was seen as a flagship for councils for the future. However, over the years, there have been concerns over the quality of delivery of the contract. Labour, which now controls the council, pledged in its manifesto to bring privatised services back in-house.
Part of the plan to transition back to in-house services included extending some contracts with Capita.
At the time the contract ending was announced, Barry Rawlings, current leader of Barnet Council, said HR and finance will be extended for just 12 months. “However, IT, customer services and revenues and benefits are more complicated to bring back straight away, and doing so would cost council taxpayers £2.6m each year, which would result in redundancies and cuts to services,” he added.
Capita will continue to provide HR and accounts payable services to the end of August 2024. It will also continue to deliver IT, customer services and revenue, and benefits services for an additional two and a half years. Meanwhile, some services not covered by these extensions will be returned to be run by the council from September 2023.
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.
Capita said it will work with the council to modernise its IT infrastructure.
“The extension of our contract with Barnet Council reflects the strength of our long-term relationship with the council,” said Al Murray, CEO for Capita Public Service. ”It also highlights our focus on creating better outcomes through the delivery of essential services for the local community.
“From next September onward, we will support the council by investing in and enhancing its digital capabilities,” he added. “We will also be providing stable and continuous delivery of services that residents and businesses interact with every day.”