Outsourced public sector staff warned of 'difficulties' over job guarantees

PUBLIC sector workers who transfer to the private sector as a result of outsourcing agreements are under threat, warns an outsourcing specialist.

Steve Langmead, vice-president Scotland of IT firm Atos Origin, said outsourcing functions of local authorities and healthcare would be "inevitable" as the government attempts to find 3.5 billion in efficiency savings.

He said agreements promising not to cut jobs when the services were outsourced were no longer sustainable.

"There is a limit to how much Atos, IMB and Accenture and the like can guarantee that in Scotland," said Langmead. "The first (government departments] that outsource will get the guarantee but then the industry will get saturated and at some point that guarantee will be very difficult for the major players to provide."

Last year Atos won a 40 million contract to run IT for the Scottish Development Service, Scottish Enterprise and Scottish Development International. Langmead said the outsourcing deal has cut the firm's IT budget by 40 per cent.

As a result of the deal, Atos took on 26 staff from SDS and SE and these jobs were guaranteed not to be subject to being made redundant.

"In reality those people are more protected than anybody in the public sector. At some point the government will have to re-look at the policy," said Langmead.

SDS estimates the deal will save the agencies 20m over the next five years.

Damien Yeates, chief executive of Skills Development Scotland, said: "This new model not only provides major operational benefits for our staff and customers but also significant savings in public expenditure.

"It also provides the platform we need to support us to deliver our stated goals of improving productivity while delivering much more to many more for much less.

"We believe this is a great example of collaborative working in the public sector to deliver higher value services at the best value."

Paris-headquartered Atos, which employs 750 people in Scotland, expects turnover of its Scottish business to reach 1bn this year.

Langmead expects to boost this further as the scale of public sector outsourcing increases.

"I think the pie will get bigger because more people will have to change the way they do business," he said.

Atos also runs a healthcare division, which offers occupational healthcare schemes and medical assessments.