Lancashire County Council in outsourcing U-turn deal with BT

Lancashire County Council in outsourcing U-turn deal with BT

Mega deal signed despite benchmarking showing in-house IT was cost-effective

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Lancashire County Council has signed a 10-year contract with BT to outsource its IT, customer service, HR and payroll and procurement functions, ComputerworldUK can reveal.

From Monday these services will pass to the control of One Connect, a strategic partnership in which BT will have a majority 60 percent stake and Lancashire County Council the remainder (40 percent), according to the One Connect website.

Although the homepage for One Connect currently displays a ‘coming soon’ message, a glitch means that other pages of the site can be viewed, including the news page announcing the launch of the partnership, dated 16 May 2011.

Lancashire is outsourcing its IT services despite years of successful benchmarking to ensure year-on-year cost efficiencies and improved services at the authority's in-house IT operation. Led by IS and ICT director Bill Brown, the council started benchmarking in 1998, alongside a rolling programme of continual improvement.

However, Brown, a former accountant, is now retiring, which coincides with a management restructure at the council that was announced this week.

Earlier this week (11 May), the council said that it was reducing the number of executive directors from six to four, and the number of directors from 22 to 15, which it said would save the council £1 million a year.

“The management restructure will allow us to save £1 million per year while protecting frontline services. With around £180 million to save over the next three years, it’s essential that we become a learner, more efficient organisation,” said county councillor Geoff Driver, leader of Lancashire County Council.

Some of these roles will now be transferred to One Connect, and Mark Orford has been appointed as the new IT director, within One Connect.

According to his LinkedIn profile, Orford has been director of ICT services at Lancashire County Council since February, as well as holding the position of head of design, development and consultancy services at BT Global Services within the local and regional government division since 2007. Until he moved to Lancashire, Orford was head of ICT design service at Liverpool Direct Limited, where he had been since 2001.

Liverpool Direct Limited is also a strategic partnership, between BT and Liverpool City Council, with BT holding an 80 percent stake. It claims to be the largest public/private partnership of its kind in the UK.

Lancashire first announced the partnership with BT in October 2010, when it said that the partnership would lead to “guaranteed” savings of at least £10 million a year, totalling at least £100 million over the 10-year contract.

It also identified potential savings of a further £30 million a year through work by the partnership to “release savings across the full range of county council operations”.

In addition to the initial services being transferred to One Connect, it said that additional council services may also be moved over to the partnership in the future.

The Lancashire decision follows a recent Socitm report which warned councils about the pitfalls of outsourcing.

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