1 No effort being put into in-house options for service improvement. The whole drive is towards privatisation with no hard evidence of any benefits but plenty of concerns about services and future costs.
2 The Council’s claims on savings are based on wishful thinking and assertions rather than facts. The examples from other authorities mostly show ‘planned’ benefits rather than any evidenced results whereas the real evidence shows things can get worse.
3 Hardly any of the 18 authorities used by the council as ‘comparable’ are anything like Edinburgh. Is Edinburgh really the same as South Tyneside, England’s smallest metropolitan borough?
4 Most of the comparators show no evidence of any benefits. In fact Bedfordshire had to terminate its contract because of poor performance, costing taxpayers £6.75 million. In Somerset last year, the contractor was fined for late filing of accounts and showed losses of £2.5 million. In Barrow-in-Furness, the Audit Commission inspection gave the outsourced Benefits Service the lowest possible rating. Redcar and Cleveland had to bring its contract back in-house.
5 There is no guarantee of jobs remaining in Edinburgh. As well as the danger of the Council’s front-line contact centre possibly ending up somewhere else, the effect on local economy of jobs leaving the city would be disastrous at the very time the city needs investment to build out of the recession.
6 The council has left key issues out of the tendering advert like bidders having to comply with legal requirements like the equalities duty, climate change etc, in case it deters them from applying.
7 Audit Commission research shows that up to 70% of strategic partnerships in the private sector fail with few meeting expectations.
8 The Audit Commission also voices concerns about the ability to respond to changes. Any organisation which wins a contract will not be in a position to respond flexibly to the changing priorities of local government service delivery – without of course asking for additional money to do so! They will have the council over a barrel, having to shell out or not deliver the service. The size of these contracts will make the companies, like the banks, ‘too big to fail’.
9 The council has not followed the Office of Government Commerce advice to produce an Outline Business Case or full options appraisal.
10 Failure to learn the lessons of the social care tender. The new ‘Remedies Directive’ means that any future procurement breach could be catastrophic for the council.