Agenda item

[Report of the Director for Customers, Transformation and Resources. To be introduced by the Leader of the Council]

This report sets out: progress to date on insourcing initiatives; the approach to insourcing services; the decision making in relation to a service delivery model; and the resourcing strategy for supporting insourcing initiatives.

The Leader of the Council introduced this report which set out: progress to date on insourcing initiatives; the approach to insourcing services; the decision making in relation to a service delivery model; and the resourcing strategy for supporting insourcing initiatives.

The Leader described the mass outsourcing of Council services as a historic mistake and the Council had given up an enormous opportunity to create opportunities. There was no guarantee that contracted-out services would create these opportunities. Their incentives were to prioritise short-term profit rather than long-term social value. That was why the Council had introduced an Insourcing Policy in the autumn, making clear that services will be brought back in-house unless there was a very good reason not to. The Council had already moved to bring in facilities management, highways engineering and some care services. A total of 25 contracts were currently in the process of being insourced.

The Leader highlighted that the Council was launching this Insourcing Action Plan so that the Council could go further in a transparent and clear way. There was a need to build up the Council again, expanding and training-up staff to take over from contractors. In some cases, works may be so small or so specialised that it does not make sense for the Council to take them on but in-house provision was the now default position. In the Leader’s view there was a need to restore democratic oversight to local services and to start to rebuild the local economy.

The Leader closed by noting that austerity significantly impacted on the Council’s spending power. He expressed that through insourcing residents would gain better value for money.

In response to questions from Councillors Ogiehor, the following information was provided:

• The Leader welcomed the prospect of the Council’s scrutiny panels providing independent views on whether the insourced services had led to improvement in performance and value.
• Regarding the number of insourced projects, the Leader noted the Council was managing this in a way that different parts of the organisation could provide insourced services safely and efficiently and also ensure that they were financially viable.
• Regarding bringing the recruitment contract in-house, the Leader noted no regrets with regard to any of his past voting and recognised that sometimes it was necessary to make decisions at a later date to maximise achievable benefits. The Leader further advised that it had not been previously possible to discontinue with the existing recruitment contract.

RESOLVED

1. To note progress made to date in relation to additional services coming back in-house set out at appendix 2;

2. To approve the recommended approach methodology outlined in Appendix 1

Reasons for decision

Direct delivery remains the Council’s preferred model of service delivery, in line with the administration’s political priorities. The report sets out how services will be reviewed with the preferred outcome that they be brought in-house to a direct or hybrid service model on a sustainable and legal basis. Endorsement of the approach and governance model set out in the report is necessary in order for the Council to implement the administration’s priority through individual decisions relating to specific services.

The methodology outlined in Appendix 1 (Insourcing Approach), provides a consistent, structured and proven methodology on which to base these decisions.

Alternative options considered

Do Nothing

The Council would continue to review contracts due for renewal on a contract by contract basis without the use of an Enabling Framework. This approach would mean that decisions would not be taken in an evidence-based way; would prevent the Council from strategically planning to pursue short, mid and long-term insourcing opportunities; would prevent the achievement of economies of scale that could otherwise support the financial and operational viability of an in-house delivery option; and would be deficient in terms of risk management.