Fujitsu Services and Walsall Council will create a joint venture vehicle that will aim to improve its 252,000 citizens’ access to information on issues such as council tax, waste collection and library services by revamping the underpinning technology infrastructure
The joint venture is expected to generate revenue of GBP650 million ($1.2 billion) over a 12-year period. The plan has been approved by the council’s cabinet, and now awaits final approval from a scrutiny panel. If it gets the green light, the project is scheduled to start at the beginning of the council’s next financial year.
The big advantage for the council is that Fujitsu Services has the resources to invest an initial GBP115 million ($219 million) in technology, training and support for the project, which is significantly higher than the council’s original target of GBP30 million ($57 million).
The two parties said the project will create 750 new jobs, with 1,557 council staff transferring to the JV company. The council has already has positive experiences of outsourcing to private contractors, having handed over the running of street light management to Amey, and education services to Serco.
The contract would be the second largest local government outsourcing initiative to be announced, although the precedent set by the largest-ever deal is not a good one.
In December 2002, Northamptonshire County Council announced plans for a $1.5 billion, 10-year deal with Hyder Business Services to support IT, procurement, property, and finance functions. However, in 2003, the two sides agreed to end negotiations due to an unbridgeable financial gap between the expectations of both organizations.
Several other UK local councils have turned to external IT services providers to help them meet the central government’s deadlines for improving citizens’ access to public services. Thurrock Council has announced a $1 billion deal with Vertex, while BT Group has won major deals with councils in Liverpool, Rotherham, Essex, and Edinburgh.
