Birmingham City Council’s in house catering company was forced to pay £7,000 for a computer – without even Wi-Fi – due to needless red tape, it has claimed.

Civic Catering told a committee it is hamstrung through direct council control with problems including having to pay £15,000 a year extra in agency costs for dozens of staff because of a city recruitment freeze.

Another exampy has been paying the council’s IT supplier Service Birmingham £7,000 for one computer at Highbury Hall which it claims it did not want or need anyway.

Members of the council’s contracts watchdog committee branded the situation ‘ludicrous’ and backed Civic Catering’s plans to break free of direct council control.

Committee chairman Majid Mahmood (Lab, Hodge Hill) said: “I find it rather bizarre that due to a council recruiting freeze we have been paying £40,000 for agency chefs over five years when they could have directly employed them for about £25,000. There should be a time limit on agency staff – after which we take on staff.

“Not only that but our in house IT supplier is charging £7,000 for a computer, which we are told does not even come with Wi-Fi – you could pick up half-a-dozen on the High Street with software and five year warranties and support for that.”

Breaking free as a wholly owned company would allow Civic Catering to not only cut those cost, it could also bid for a wider variety of catering contracts and perhaps turn a significant profit for the City Council.

Head of Civic Catering Muir Wilson said that they are also placed under strict council budget restrictions requiring them to cut costs.

He said: “If we had a realistic budget and were allowed to compete in the market we could grow the business.

“We have had long term agency staff for five years which we are forced to pay for we would love to employ them on our own terms.”

Under the independence of council’s arms length Acivico company they would borrow £350,000 to upgrade kitchen facilities at the Council and bid for a wider range of contracts.

The company currently hosts wedding receptions and conferences and provides the catering at the Council House and Highbury Hall. It also runs canteens and vending machines at council offices, the Old Rep Theatre and West Midlands Fire Service HQ. It has won the contract for the new Library of Birmingham and is bidding for the Town Hall and Cockmoors Woods Leisure Centre.

They are currently looking to expand the amount of Asian and African Caribbean wedding receptions at the Council House and Highbury Hall.