City set to ask private firms to bid for services

PRIVATE firms are set to be invited to bid to run a raft of Edinburgh's council services within weeks, it emerged today.

The radical move – the biggest ever shake-up of its kind – will see services including bin collections, street cleaning and school meals taken over within 18 months.

The changes would affect 2,235 staff and 94.6 million worth of services as the city council looks at "alternative business models" to save money.

It is facing one of the worst financial crises in a century and is battling a 90m black hole over the next three years.

It is expected that, when the services are re-tendered, the council could make savings of between 10 and 30 per cent in each area.

City leader Jenny Dawe said: "The financial situation facing the council is unparalleled. The council must continue to provide maximum value for taxpayers' money, while delivering the quality frontline services that residents expect.

"We must therefore radically review the council's operations to transform customer service and secure real efficiencies.

"Proposals would only be progressed were a strong business case demonstrated."

The council's proposals will see it enter a "competitive dialogue" process with firms interested in running any of 17 services from payroll and benefits to school janitors and security.

They will be packaged together under three groupings: corporate and transactional services, property and facilities management, and environment services.

However, companies will also be able to bid for individual services within each package.

Each service is to be advertised in the European Journal in January if councillors back the plans at a full council meeting next month.

Each company would then submit bids detailing how much they believe they can provide each service for, in what would be expected to be a 12-18-month process.

Providers could run the services for the council or, alternatively, joint ventures could be set up.

The move could lead to job losses if firms believe they can provide the service for less using fewer staff. However, pension rights would be protected.

Councillor Dawe insisted that final decisions will require council approval. She added: "The council is committed to working constructively with the trade unions to explore and evaluate all of the options, and staff will be kept informed of any decisions."

Tom Aitchison, the council's chief executive, said: "A range of research studies have identified that public sector organisations have typically achieved savings of between 10 per cent and 30 per cent. It is not possible to predict the level of savings in Edinburgh that could result from the programme until the competitive dialogue process is completed."

UP FOR GRABS

AREAS set to be offered to private firms by the city council include:

Environment services

30.8 million a year and 650 staff. Includes:

• refuse collection

• street cleansing

• ground maintenance

Property and facilities management

37m a year and 895 staff. Includes:

• building maintenance

• security

• mail

• janitorial/caretaker

• reception

• porterage

• event management

• room booking

• ground maintenance

Corporate and transactional services

26.8m a year of services and 690 staff. Includes:

• revenue and benefits

• human resources

• payroll

• procure to pay

• contact centre