Businesses Set To Outsource Waste And Cleaning Services

Edinburgh City Council is reportedly set to outsource its waste and cleaning services

to a third-party provider, which is currently undergoing a major restructuring.

According to the Scotsman, the local authority is poised to hand the contract to Lancashire-based firm Enterprise, owned by private equity firm 3i. The company announced earlier this year it had sold its debt to a consortium of financial institutions including Goldman Sachs, Angelo Gordon and KKR.

In these challenging times it is essential that the council critically examines every opportunity to enhance services and improve efficiency, said council leader Jenny Dawe. Thats why we embarked on a detailed exploration of alternative models of business for the council to engage in.

Councillors will meet on Thursday to discuss the proposals, which the local authority hopes will provide savings of 71.6m. Enterprise recently agreed a 23-year contract to provide environmental and facilities management for Peterborough Council.

Last week, Cabinet Office minister and Paymaster General Francis Maude called on local authorities to find more efficient ways of delivering functions, citing the need to save money in the current financial climate.

According to a survey of large private and public sector organisations carried out by Chatham Partners and HR consultancy Mercer, just under half are expected to outsource over the next three years, whilst 10% said they would seek third-party providers in the longer term. One-third more HR leaders said they were in favour of outsourcing pensions administration than those from other professions, consequently producing many freelance jobs within this field. Interest in outsourcing was stronger in mainland Europe, with 58% of continental respondents prepared to put certain functions out to tender as opposed to 27% in Britain.

In a worsening economic climate, we see companies looking for ways to manage their pension liabilities, said Jonathan Mindell, Mercers head of outsourcing for Europe, Africa and the Middle East. Outsourcing to pension specialists should minimise the risks of regulatory non-compliance, provide fixed fee certainty, and ensure that investment continues to be made.

The report came after Gloucester City Council announced it had recruited Civica to oversee the delivery of revenues and benefits services, whilst a commercial radio executive has suggested the BBC should consider outsourcing certain radio roles too.

The Guardian reports that Andrew Harrison, Chief Executive of the Radio Centre trade body, said in a recent speech to the Radio Festival in Salford that entire BBC stations could be contracted out to third parties in the commercial sector. The BBC is currently facing major cutbacks, with the TV license fee frozen until 2016.

If we are truly to deliver quality first, truly to reinvent our wonderful sector fit for the next 20 years, we need to be visionary and radical, not incremental and conservative, Mr Harrison said. BBC local [radio] has a content budget projected at 120m per annum. Why not outsource that to the commercial sector?

by: Tim Bisley

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