Category Archives: Birmingham City Council

Are you happy paying to help with problem Capita contract?

By Tony Collins

This week, as Barnet residents go to the polls, how many will be influenced by the continuing national and local media coverage of the council’s mass outsourcing deal with Capita?

Barnet’s Capita contracts are a local election issue. The council’s conservatives and Capita say the outsourcing contracts have saved money and are performing as expected “in many areas”.

But a former local Tory councillor Sury Khatri , who has been deselected after criticising the Capita contract, described the deal as “disastrous”. Barnet has paid Capita £327m since the deals were signed in 2013. Capita runs council services that range from cemeteries to IT.

Councillor Khatri said,  “My time at the council has been overshadowed by the disastrous Capita contract that is falling apart at the seams. Four years on, issues still keep rolling out of the woodwork. This contract represents poor value for money, and the residents are being fleeced.”

Another critic of the Capita contracts is John Dix who blogs as “Mr Reasonable” and is one of several highly respected local bloggers. He has been studying the council’s accounts for some years. He runs a small business and is comfortable with accounts and balance sheets.

He writes,

“I have no problem with outsourcing so long as it is being done for the right reasons. Typically this is where it involves very specialist, non core activities where technical expertise may be difficult to secure and retain in house.

“In Barnet’s case this outsourcing programme covered so many services which were core to the running of the council and which in 2010 were rated as 4 star (good). Barnet has been an experiment in mass outsourcing and almost five years in, it appears to be a failure.

“Last night’s [19 April 2018] audit committee was a litany of service problems, system failures, lack of controls, under performance, a major fraud. Internal audit saying issues were a problem, Capita saying they weren’t.”

Shadow Chancellor John McDonnell has entered the debate. He has applauded Barnet’s Unison branch for its enduring, close scrutiny of the Capita contracts. Unison this week published a report on the deal.

Capita’s share price rises

Earlier this month the national press reported extensively on concerns that Capita would follow Carillion into liquidation.

Since the bad publicity, the company’s announcement of a pre-tax loss of £535m, up from £90m the previous year, £1.2bn of debt and a rights issue to raise £662m after fees by selling new shares at a discount, Capita’s share price has risen steadily, from a low a month ago of about 130p to about 191 yesterday.

Could it be that investors sense that Capita’s long-term future is secure: the company has a wide range of complex and impenetrable public sector contracts where history shows that public sector clients – ruling politicians and officials – will defend Capita more enthusiastically than Capita itself, whatever the facts?

A list of some of Capita’s problem contracts is below the comment.

Comment

Carillion, a facilities management and construction company, collapsed in part because the effects of its failures were usually obvious: it was desperately short of money and new roads and hospitals were left unfinished.

When IT-based outsourcing deals go wrong, the effects are usually more nuanced. Losses can be hidden in balance sheets that can be interpreted in different ways; and when clients’ employees go unpaid, or the army’s Defence Recruiting System has glitches or medical records are lost, the problems will almost always be officially described as teething even if, as in Capita’s NHS contracts, they last for years.

It is spin that rules and protects IT outsourcing contracts in the public sector. Spin hides what’s really going on. It is as integral as projected savings and key performance indicators.

When Somerset County Council signed a mass outsourcing deal with IBM, its ruling councillors boasted of huge savings. When the deal went wrong and was ended early after a legal dispute with IBM the council announced that bringing the deal in-house would bring large savings: savings either way. Liverpool council said the same thing when it outsourced to BT – setting up a joint venture called Liverpool Direct – and brought services back-in house: savings each time.

Barnet Council is still claiming savings while the council’s auditors are struggling to find them.

Spinmeisters know there is rarely any such thing as a failed public sector IT contract: the worst failures are simply in transition from failure to success. Barnet’s council taxpayers will never know the full truth, whoever is in power.

Even when a council goes bust, the truth is disputed. Critics of spending at Northamptonshire County Council, which has gone bust, blame secretive and dysfunctional management. Officials, ruling councillors and even the National Audit Office blame underfunding.

In March The Times reported that Northamptonshire had paid almost £1m to a consultancy owned by its former chief executive. It also reported that the council’s former director of people, transformation and transactions for services, was re-hired on a one-year contract that made her company £185,000 within days of being made redundant in 2016.  Her firm was awarded a £650-a-day IT contract that was not advertised.

In the same month, the National Audit Office put Northamptonshire’s difficulties down to underfunding. It conceded that the “precise causes of Northamptonshire’s financial difficulties are not as yet clear”.

Perhaps it’s only investors in Capita who will really know the truth: that the full truth on complex public sector contracts in which IT is central will rarely, if ever, emerge; and although Capita has internal accountability for failures – bonuses, the share price and jobs can be affected – there is no reason for anyone in the public sector to fear failure. No jobs are ever affected. Why not sign a few more big outsourcing deals, for good or ill?

Thank you to FOI campaigners David Orr and Andrew Rowson for information that helped me write this post.

Some of Capita’s problem contracts

There is no definitive list of Capita’s problem contracts. Indeed the Institute for Government’s Associate Director Nick Davies says that poor quality of contract data means the government “doesn’t have a clear picture of who it is buying from and what it is buying”. Here, nevertheless, is a list of some of Capita’s problem contracts in the public sector:

Barnet Council

A Capita spokesperson said: “The partnership between Capita and Barnet Council is performing as expected in many areas. We continue to work closely with the council to make service enhancements as required.”

Birmingham City Council

“The new deal will deliver a mix of services currently provided under the joint venture, plus project based work aimed at providing extra savings, with forecasts of £10 million of savings in the current financial year and £43 million by 2020-21.”

West Sussex County Council

A spokesman said, “Whatever your concerns and small hiccups along the way, I believe this contract has been and will continue to be of great benefit to this county council.”

Hounslow Council

A Capita spokesperson said: “We are working closely with the London Borough of Hounslow to ensure a smooth transition of the pensions administration service to a new provider.”

Breckland Council

“They concluded that planning officers, working for outsourcing company Capita, had misinterpreted a policy, known as DC11, which dictates the amount of outdoor playing space required for a development..”

Army

Mark Francois, a Conservative former defence minister,  said Capita was known “universally in the army as Crapita”. But Capita said in a statement,

“Capita is trusted by multiple private and public clients to deliver technology-led customer and business process services, as demonstrated by recent wins and contract extensions from clients including British Gas, Royal Mail, BBC, TfL Networks, M&S and VW.”

Electronic tagging

(but it’s alright now)

A Ministry of Justice spokeswoman said: “As the National Audit Office makes clear, there were challenges in the delivery of the electronic monitoring programme between 2010 and 2015…

“As a direct result, we fundamentally changed our approach in 2015, expanding and strengthening our commercial teams and bringing responsibility for oversight of the programme in-house.

“We are now in a strong position to continue improving confidence in the new service and providing better value for money for the taxpayer.”

Disability benefits

A spokesperson for the Department for Work and Pensions said, “Assessments work for the majority of people, with 83 per cent of ESA claimants and 76 per cent of PIP claimants telling us that they’re happy with their overall experience…”

Miners

A Capita spokesperson said: “This issue has been resolved and all members affected will shortly receive letters to advise that they do not need to take any action. We sincerely apologise for any concern and inconvenience this has caused.”

NHS

Opticians

Dentists

BBC licence fee

Windrush

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Birmingham Council to “close down” contract with Capita when it ends in 2021

By Tony Collins

Birmingham City Council has said in a job advert that it plans to “close down” its joint venture contract with Capita when it expires in 2021.

The advert was discovered by Government Computing which has reported the job requirements in detail.

Capita and Birmingham City Council have one of the largest and longest IT-based outsourcing contracts in the public sector.

It began in 2006 when the council and Capita set up a joint venture “Service Birmingham”. The council has spent about £85m to £120m a year on the contract which puts the total cost of the deal so far at more than £1bn.

Government Computing reports that the council is seeking an assistant director ICT and digital services and CIO role. The job will include a task to “oversee the effective closedown of the current Service Birmingham ICT contract”.

This suggests the council is unlikely to renew the existing contract. It could decide to sign a new outsourcing deal but the signs so far are that the council will bring services in-house in 2021.

The council says in the job advert it wants to move to an “increasingly agile state of continuous business transformation”.

Nigel Kletz, director of commissioning and procurement for Birmingham City Council, told Government Computing,  “The current Service Birmingham contract has four years still to run (until 2021), so this role will lead the implementation of the ICT and digital strategy, which includes developing a transition programme to identify and then implement ICT delivery options going forward.

“Decisions on how ICT support is provided from 2021 onwards are yet to be taken.”

Capita did not add to the council’s statement.

Alan Mo, research director at public sector analysis group Kable, is quoted in Government Computing as saying,

“When it comes to ICT, Birmingham is the largest spending council in the UK. Given what’s at stake, we cannot over emphasise the importance of early planning…

“As we know, Service Birmingham has been under a huge amount of scrutiny over the past few years. Given the trends in local government, it would not surprise us if Birmingham prefers to go down the in-sourcing path; the council has already opted to take back contact centre services.”

Projected savings of “£1bn” 

Service Birmingham lists on its website some of the benefits from the joint venture.

  • Projected cost savings of £1bn back to the Council over the initial 10-year term, for reinvestment in services
  • £2m investment in a new server estate
  • Rationalising 550 applications to 150
  • Consolidated 7 service desks into 2
  • 500% improvement in e-mail speed
  • Help desk calls answered within 20 seconds increased from 40% to nearly 90%

Service Birmingham provides Birmingham City Council’s IT, along with a council tax and business rates administration service. The council has discussed taking back in-house the council tax  element of the contract. 

Capita has run into trouble on some of its major contracts, including one with the NHS to supply services to GPs.

Comment

It appears that Capita has served its purpose and put the council into a position where it can take back ICT services now that are in a better state than they were  at the start of the contract 2006.

Austerity is the enemy of such large public sector IT-based outsourcing contracts.  When councils can afford to spend huge sums – via monthly, quarterly and annual service charges – on so-called “transformation”, all may be well for such deals.

Their high costs can be publicly justified on the basis of routine annual efficiency “savings” which do not by law have to be verified.

The downfall for such deals comes when councils have to make large savings that may go well beyond the numbers that go into press releases. It’s known that Birmingham City Council has been in almost continuous negotiation to reduce the annual sums paid to Capita.

Capita is not a charity. How can it continue to transform ICT and other services, pay the increasing salaries of 200 more people than were seconded from the council in 2006, accept large reductions in its service changes and still make a reasonable profit?

It makes economic sense, if Birmingham needs to pay much less for IT, to take back the service.

It’s a pity that austerity has such force in local government but not in central government where IT profligacy is commonplace.

Job spec for senior Birmingham IT post looks towards end of Service Birmingham ICT deal – Government Computing

 

Can Birmingham City Council afford this jargon-laden Big Data project?

By Tony Collins

Birmingham council’s “Big Data Corridor” commits multiple offences against the English language. Could its jargon-heavy justifications threaten the usefulness of the project?

Birmingham City Council is running a budget deficit expected to be £49m in 2016/17. That hasn’t stopped it from pushing forward with plans to invest in a “Big Data Corridor” that has left at least one leading councillor confused as to its purpose.

Councillor Jon Hunt, leader of he Lib-Dems on the Labour-run council,  told a cabinet meeting that the project was “potentially exciting” and he thanked Aston University for its involvement but he added,

“I was a bit confused about the purpose of it.”

Birmingham City Council will be contributing hundreds of thousands of pounds towards the research project – money that Hunt said the council cannot afford.

He said Birmingham City Council may be best placed as an “enabler” of such projects rather than “putting in money it doesn’t have”.

A report to the council’s cabinet said,

“The proposed Big Data Corridor (BDC) project at a total cost of £2.568m will support Small/Medium Enterprises (SME’s) to understand the benefits of using data to design new services and products that will respond to specific challenges in East Birmingham, as a demonstrator.”

Quite what that means is unclear in the report; and leading councillors gave no direct responses to Hunt’s points about the unclear purpose of the project and  whether the council can afford it.

Birmingham Council says the Big Data Corridor is a “new initiative led by Birmingham City Council in partnership with Aston University, Future Cities Catapult, Centro, Telensa, Innovation Birmingham, local SMEs and community groups of the Eastern Corridor Smart Demonstrator.

The project is part funded by its participants, including Birmingham council, and the European Union’s European Regional Development Fund.

A report to the council’s cabinet said the project would “address specific challenges such as creating a healthy happy city”.

Comment

Birmingham City Council’s Big Data Corridor may be a fun research project to work on – but what’s its point?

The council says the aim of the project is to

 “create an innovative, connected data marketplace – a new disruptive economy – where SMEs use data to create new applications, services and experiences to serve personalised demand for businesses and communities in the Corridor, generating social and environmental value alongside hard economic impacts”.

But what’s its purpose for the citizens of Birmingham?

“SMEs will be supported to use data and technologies to create new services, and products that will respond to specific challenges in East Birmingham to deliver to beneficiaries in the Corridor, generating social, environmental and economic value….”

How is that useful to residents?

“Working with the Smart City Commission, we are exploring how the wider deployment of smart city / future internet-based technologies and services can help drive innovation and accelerate delivery of city outcomes bringing together both needs of public services, community and private sector.”

Which means?

“The demonstrator will aim to tackle local problems in a more holistic, layered and integrated way.

” It will drive greater connectedness along urban clusters – connecting assets, data, talent, location, infrastructure to combine innovative design, use of community and social spaces and services with housing and infrastructure developments; new models of commissioning and service delivery enabled through civic and social enterprise.”

Actual uses please?

“The demonstrator which links into existing City development plans e.g. Birmingham Connected City (formerly the Birmingham Mobility Action Plan); Birmingham Development Plan; East Birmingham Prospectus for Growth will focus on:

  • Mobility & connectivity – Improving how people travel around across all modes and enabling access to employment opportunities;

  • Health – Healthy ageing; improve quality of life / mental health & wellbeing indicators;

  • Skills & Enterprise – Manage supply and demand; Upskill local population and talent for innovation; grow level of enterprise and sustainable start-up & business growth

  • Information Marketplaces – enabling programme of activity creating conditions for data to be extracted and /or exchanged by multiple partners & stakeholders prioritised around above themes; creating the supply chain that may include business / developers that can create value with this new data

Yes, but one specific purpose?

“The Big Data Corridor will utilise a data platform provided by Birmingham City University, which will act like an address book to access a range of public and commercial service data sets, which will enable Small/Medium Enterprises with support through this project, to create new products and services to help address challenges faced by the Greater Birmingham and Solihull Local Enterprise Partnership.”

Its benefits for Birmingham council tax payers who would help fund the project?

“[The Big Data Corridor] aims to accelerate the digital capabilities of businesses to capitalise on the exponential growth of the Internet Of Things and Data Economy by developing solutions with citizens to address city in the areas of health, mobility and sustainability. This will be enabled through 3 key strands. All support for SMEs will be provide free of charge based on meeting eligibility criteria.”

Yes but specific benefits?

“[The Big Data Corridor] will host technology and data rich demonstrator activities to enable GBSLEP SMEs to develop new services and products enabled by the new data streams and tested in East Birmingham in response to specific challenges identified through work with stakeholders and communities. Note that this project will not compile data sets, but accesses those available openly or if will purchase them if necessary through this project.”

Specifically?

“[The Big Corridor will] provide technical and business support utilising the Serendip Incubator (a space for businesses to collaborate) at Birmingham Science Park – Aston to engage SMEs, manage their involvement, support rapid prototyping and commercialisation of products and services.”

Yes, but …

“To address congestion …”

Aha! A specific purpose. In what way will the Big Data Corridor reduce congestion?

“[It] could be for SMEs to access Telensa’s smart lighting application network, Centro transport data, personal data such as schemes that are already operating to enable individuals to share data voluntarily, as well as social media data to develop new products to incentivise behaviour change of citizens from cars to public transport to reduce congestion.”

Rarely before have so many offences against plain English been committed within one IT project.

The serious point is that unclear, abstract English and unclear thinking go hand in hand.

Orwell said that the “slovenliness of our language makes it easier for us to have foolish thoughts”.  He would probably have described Birmingham council’s phrases such as “accelerate delivery of city outcomes” and “generating social, environmental and economic value” as avoidably ugly.

Such phrases suggest that their author was indifferent as to whether the words meant anything or not. They are easily written – because they don’t require any thought.

Orwell could have been looking at Birmingham Council’s words on its Big Data Corridor when he wrote,

“This mixture of vagueness and sheer incompetence is the most marked characteristic of modern English prose, and especially of any kind of political writing.

“As soon as certain topics are raised, the concrete melts into the abstract and no one seems able to think of turns of speech that are not hackneyed: prose consists less and less of words chosen for the sake of their meaning, and more and more of phrases tacked together like the sections of a prefabricated hen-house.

Indeed it’s hard to see how Birmingham council found the money for the Big Data Corridor, based on the poor quality of information it has provided so far.

One explanation could be that finance councillors and officials watched in awe as the river of ostensibly worthy phrases flowed in front of them – phrases such as “greater connectedness along urban clusters”.

Possible big data uses

One possible specific use of the big data corridor would be to “develop a service to enable citizens to find the healthiest and safest walking routes to local chemist”.

How many Birmingham citizens will take the time to use such an app rather than get to the chemist in the shortest possible time?

Another potential app would show air quality in real-time. This would be useful.

Big data could also be used for street lighting – to allow for the manual brightening of lights when required – and for triggering CCTV and a local response when certain noises are detected.

But would such potential uses be forgotten while project professionals wriggle furiously to try and stop themselves sinking into the Big Data Corridor’s mudflats of jargon?

It’s possible the project will create 56 jobs, which would be one tangible benefit. But what the new recruits will do for local residents is unclear.

Ideally, perhaps, they’d have the skill to translate abstract words and phrases into jargon-free English so that Birmingham’s residents would know how their Big Data Corridor money is being spent.

Perhaps the project may even win an award. Campaign4Change nominates Birmingham’s Big Data Corridor for the Golden Bull award 2017. It’s an award for the year’s worst written tripe.

This is from Orwell’s essay “Politics and the English Language”,

“A speaker who uses that kind of [abstract] phraseology has gone some distance toward turning himself into a machine. The appropriate noises are coming out of his larynx, but his brain is not involved …”

He added,

“This invasion of one’s mind by ready-made phrases (lay the foundations, achieve a radical transformation) can only be prevented if one is constantly on guard against them.”

In a report on the use and abuse of official language, the House of Commons’ Public Administration Committee criticised  “unlovely” words and phrases such as “step changes”, “stakeholder engagements”, “win-wins”, “level playing fields” and “going forwards”.

It concluded that a poor use of language by officials can amount to “maladministration”. The committee said,

“In our view, using confusing or unclear language that is so bad that it results in people not getting the benefits or services to which they are entitled, or which prevents them from understanding their rights or the choices available to them, amounts to ‘maladaministration’.

The Parliamentary Ombudsman at that time agreed with this view.

She said,

“I think if it got to the point that it was actually incomprehensible, then it would be in contravention of my principles about providing information that’s clear, accurate and not misleading.”

Click here to generate gobbledygook similar to Birmingham Council’s (Plain English Campaign’s gobbledygook generator).

 

Use and abuse of official language – House of Commons Public Administration Committee

Big Data Corridor bid goes through to the next stage

Big Data Corridor report

Big Data case studies

Birmingham council savings too ambitious and too many uncertainties.

Birmingham blog

Digital Birmingham

 

 

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