Council explores partnerships with companies to run services in Northumberland

COUNTY council services in Northumberland could be farmed out to a profit-making company.

The authority is under pressure to save £70m within three or four years, on top of £100m and 1,500 jobs it has slashed already.

But chief executive Steve Stewart says that is not the main reason for contemplating such a huge step.

He has told councillors in a confidential letter the aim would be to find “a committed partner that will invest, grow and rebalance the economy, bringing investment and new jobs into the area”.

It is also stated there was no intention of exporting council jobs from the county.

He says: “The county is currently looking to work with a strategic partner for the delivery of superfast broadband across Northumberland after a successful bid for national funding, and because we are going into the market to find much-needed investment for this project, it makes sense to explore other opportunities at the same time.”

One opportunity is ‘transactional services’, which include IT and employs 2,000 to 4,000 people. Staff are being told this week.

“We are about to start informal talks with the trade unions on this issue, which will raise interest and generate reactions,” Mr Stewart informs councillors in the letter.

“It will no doubt be a political and emotional issue, but as you know, it’s something we have to explore.”

Unison joint branch secretary Ian Fleming said: “We are really apprehensive, but we are at an early part of a discussion.”

He added: “These big organisations are about making profits.

“You’ve got to ask yourself, how good is that service going to be compared to the service we have got at the moment?

“We know everyone has to make savings. But we believe there is no long-term guarantee that jobs will remain in Northumberland.

“Because they are transactional services they may end up like our mining industry, ie the service can be provided more cheaply elsewhere in the world and it could be delivered in China or India.”

Liberal Democrat council leader, Coun Jeff Reid, said there was no privatisation plan and the authority was exploring partnerships with other councils as well as commercial organisations.

“Our focus is to maintain the frontline services to the people of Northumberland and I would be derelict in my duty if I wasn’t thinking about every possibility that there is.

“The county council is the heart of the economy. Nobody in their right mind is going to go into any kind of partnership with anybody that exports money and jobs out of Northumberland.”

County Labour group leader Coun Grant Davey said: “Northumberland Labour Group is committed to the development of world class in-house public services and we are very disappointed that the administration and its officers have chosen the route to privatisation as the model for change.

“With the loss of 1,500 local government jobs since the new unitary county council was formed, the loss of Northumberland Foods, Alcan and the leaching of larger schools from council control to academies, Northumberland needs to find a new direction to support its populous.

“Partnering with a private sector provider isn’t, in our eyes, the correct direction of travel, as history shows the only way savings can be made through partnership is by running a two-tier workforce where the terms and conditions of staff are constantly under attack.”

According to Mr Stewart, the council faces a “perfect storm of reforms and changes to local government funding which will have major implications for Northumberland”.

He says: “If we don’t look at all available options, we may be faced with making decisions in line with other local authorities that we have avoided so far – these decisions are large-scale job losses and shutting frontline services.”

He goes on: “The council will only commit to this if all our conditions and objectives can be met and we are not interested in taking jobs or work out of the county.

“But the scale of the cuts we are currently facing means that one way or the other, the council of the future will be smaller than it is now.”