The private contractor (2e2) that manages all LB Barnet's ICT infrastructure, including critical systems that social services rely on and all residents use to contact the council, has gone into administration, forcing Barnet to initiate an emergency procurement for the service.
A Delegate Powers Report agreed in consultation with Deputy Leader of the Council, Cllr Daniel Thomas, has just been published notifying councillors that the council have agreed that Capita should provide the interim service on an emergency basis. The details of the report state that:
"3. RISK MANAGEMENT ISSUES
3.1 The assessed impact of the loss of the infrastructure managed service contract is
categorised as Almost Certain / Catastrophic (Corporate JCAD 25).
3.2 The managed service supported and maintained the council’s ICT security, data
storage, all data and telephony networks, all telephony services, and all remote
access to council services.
3.3 All social care services are critically reliant on these ICT services, and residents are
reliant on them for contact with the council.
3.4 Without the contractual support in place, the council would be unable to restore or
ensure continuity of these critical ICT services.
3.5 The council IS staff are not skilled or resourced to deliver an adequate cover for
these contracted services and the only way to secure continuation of service was to
enter into an emergency arrangement with an alternative supplier.
3.6 2e2 withdrew its service within a few days of going into administration and finally
terminated the service nine days after the administrators were called in.
3.7 The only options open to the council in order to mitigate risk was to secure an
interim contract prior entering into an EU regulated procurement (which could take
six to nine months to complete) or transfer to the New Support and Customer
Services Organisation (NSCSO) provider."
The report also states that a check of 2e2's financial standing in January showed that "the company was satisfactory with high levels of borrowing and acquisition activity. There was no indication that this would lead to administration and hence could not have been predicted."
This is precisely the sort of concern Better Barnet has about relying on the private sector to provide critical council services. When things go wrong, risk is NOT bourne by the contractor, it is the council that has to step in and sort it out. In the event that the council can't because it has already outsourced all the capacity, infra-structure and knowledge then it has to rely on yet another private contractor.
The council is now having to scramble around to try and get a refund on at least £220,000 already paid in advance to 2e2 for the service they can no longer deliver.
And, there will be an additional cost to the council of £90,744 for this financial year alone.
Does this make sense as a modus operandi for most council services?