Nowhere is the changing face of local government more evident than in Birmingham where, partly because of the sheer size of the city council budget, radical changes often appear more controversial than perhaps is actually the case.
On the face of it, the £1 billion that Capita stands to earn from its contract to deliver council IT services and run the call centre is high enough to prompt a gasp of astonishment from most people. The figure is, however, only a little more than £60 million a year, which is about two per cent of the council’s annual budget.
The amount being paid to Capita is almost certainly far less than the profits that will be generated by Amey during the 25-year life of its £2.7 billion PFI agreement to improve and maintain Birmingham’s roads and pavements.
With all of these semi-privatisation issues, two questions stand out above all others. The first, will the venture deliver a better service to the people of Birmingham at less cost? The second, how can the activities of these companies be publicly scrutinised?
As far as value for money and quality of service is concerned, the jury is still out on Capita’s Service Birmingham organisation. The story as far as the company is concerned, and the deputy council leader, is one of performance targets being met time and again and even being exceeded in some case.
No doubt this is true, although how rigorous the targets actually are is a matter for debate. On the matter of transparency, we only have the findings of a council scrutiny committee to go by and the prognosis is far from healthy.
A report setting out a scrutiny committee’s findings following a lengthy investigation, based on visits by councillors to the Service Birmingham call centre, describes “numerous failings”, points to incompatible IT systems and questions the wisdom of allowing Capita to get away with a payment system based on receiving more money for the number of calls handled – a perverse incentive, surely, to encourage council customers to phone back thus earning more money for Capita.
These are, no doubt, teething problems that may be ironed out fairly quickly. It should be remembered that Service Birmingham’s introduction of an electronic billing system for council invoices got off to a chaotic start, but settled down after a few months and is now performing adequately.
It should also be remembered, as the deputy council leader rightly points out, that even with the current call centre glitches the council’s customer service offer is far better than was the case a year or so ago, when queues snaked around neighbourhood offices and it routinely took months to get even mundane requests sorted out.
The council’s main scrutiny committee must not be put off by the vitriol that will inevitably fly its way for daring to criticise a major project. For without open examination of Service Birmingham’s performance, council tax payers have no idea whether they are getting value for money or not.
The next challenge for the scrutineers is to cast their net at Amey by shedding a little light on the Highways PFI performance. It is difficult to imagine more basic public services than roads, pavements and street lighting, yet the council has been forced for financial reasons to pass control to a private company.
Maybe this will be a fantastic success, just like the call centre. Let the microscope of scrutiny be the final arbiter in these cases.