Denbighshire County Council expects to save £1.4m through a deal with Civica that will see business processes outsourced but delivered locally.
The seven-year deal to outsource revenue and benefits will see 74 council staff transfer to Civica. It aims to save the local authority £200,000 a year.
Civica will create a local delivery centre to protect local employment. The centre could provide services to other public sector organisations in Wales in the future.
"Like all councils in the UK, we are having to look at innovative ways of working in order to continue to provide services in the face of severe budget restrictions,” said Julian Thompson-Hill, cabinet lead member for finance at the council.
Civica will automate and transform critical council services, he said.
The fact that the service centre could help other organisations is a boost to the local economy, added Thompson-Hill.
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"The agreement means we can look to the future knowing we can not only maintain, but improve and grow the work we do in Denbighshire and actually create more jobs further down the line through taking on work for other authorities.”
He said employees and unions had been included throughout the process, “providing very positive feedback”.
A recent poll of more than 1,000 people found 68% of the UK public want to be consulted on public-sector outsourcing, with Labour and Ukip supporters most in favour.
The poll, conducted by campaign group We Own It, found that half of the respondents were not in favour of outsourcing public-sector IT and would like to see more services run in-house.
According to research from Information Services Group, the UK public sector has spent about 70% more than UK businesses on IT outsourcing and business process outsourcing over the two years up to July 2014.