Capita is looking to send a number of Birmingham City Council IT jobs overseas, to India.
The affected jobs are with Service Birmingham, a controversial £1 billion outsourcing contract the council has with Capita to provide ICT, contact centre and revenue services until 2021.
“As part of our ongoing partnership with Birmingham City Council we are exploring how we can utilise some overseas expertise to help deliver a cost-effective addition to our existing Birmingham operation,” a spokesperson for Service Birmingham said.
“We are talking about a limited number of back office technical roles. No customer-facing staff will be affected.”
Around 55 back office technical roles are being considered for offshoring to by the end of summer 2011. Another 45, taking the total number of affected roles to 100, could potentially go by the end of the year.
“It is still early days and we will actively work with our trade union representatives as our plans develop.
“It is important to emphasise that this is a very small element of the work we do for the council and we remain absolutely committed to our Birmingham workforce,” the spokesperson added.
On the Service Birmingham website, the council’s IT investment is described as the “bedrock” of the council’s transformation programme, which aims to “deliver cost savings of £1 billion over 10 years”.
Since the partnership was established in 2006, it said it has helped to improve the council’s IT infrastructure by investing £2 million in a new server estate, and consolidating seven service desks into two. It has also helped to rationalise 550 system applications to 150.
However, in 2007, the council’s new SAP e-procurement system kept crashing, which reportedly caused suppliers to send round bailiffs to collect unpaid bills.
At one point, there was a backlog of 20,000 to 30,000 unpaid invoices. But in 2009, Councillor Paul Tilsley said the system was rescued and was working, praising the "radical and nationally acclaimed transformation programme".
In order to save £300 million a year over the next three years, in response to the government’s Spending Review, Birmingham City Council in February announced plans to increase outsourcing and expand its shared services efforts.
Last week, Lancashire County Council became the latest local authority to form a public/private partnership, called One Connect, to operate its back office functions. It signed a 10-year contract with BT to outsource its IT, customer service, HR and procurement functions.
It made the move despite years of successful benchmarking to ensure year-on-year cost efficiencies and improved services at the authority's in-house IT operation.