We don’t normally link to Conservativehome.com – it’s a national conservative website.
But there’s an important article on there tonight about Lord Hanningfield’s plans for Essex County Council. The writer clearly thinks it’s a great idea:
IBM have won the huge ?5.4 billion, eight year, contract from Essex County Council for a mass privatisation of their services. This follows a report in March that IBM were competing for the contract with TI Systems. It promises to leave Essex residents very well placed to withstand the inevitable coming squeeze on Town Hall budgets.
But the comments from readers on there are generally very ‘anti’. It seems that a lot of Conservatives don’t think this kind of mass privatisation will work out best. Here’s some typical responses:
Is IBM going to be used like a quango, hiding real responsibility away from voter accountability even further? What happens when Essex come to renegotiate and they no longer have the organisation to do anything other than agree to IBM’s renewal terms (a problem often encountered by those outsourcing in industry – usually after the manager who negotiated the outsourcing has left)?
Another bunch of politicians proving they haven’t got the guts or the foresight to make the hard decisions themselves. Instead they hand it over to another fat obese global monster.
The only piece of good news here is that Essex are saving some money short-term. The bad news, and there is plenty of it, is that like most other IT outsourcing ventures, the service quality but not scope will fall significantly, jobs will be lost (with the taxpayer no doubt footing the bill – what are the redundancy and early retirement packages like in Essex?), medium term prices will go up (everything will become an extra cost) so long term it will become even more expensive than keeping it in-house, data security (and it is Essex people’s data remember) will go out of the window and IBM no doubt using their usual methods will have got another government body’s scrotum firmly in their hands.
This is the text book Thatcher/ Major mistake that opened the door to the extreme waste of resources in Government on IT over the last 20 years.
Short term gain – long term misery. Will they never learn! The thing is once you have outsourced there is virtually no chance of going back in house – the knowledge drain is far too great.
PS And I’m no leftie! Just someone who has worked in the IT game long enough to know a bit about it.
Britain tomorrow? – god help us!
As several comments suggest, the ‘proof of the pudding’ etc and ‘the devil is in the detail’. Outsourcing, per se, can be an effective, cost efficient, valid business proposal, especially where there are obvious synergys (Eg IT & IBM) but more difficult to understand how IBM will operate gritters etc better.
I just hope Lord H. has got the detail on this right.
May be if this had happened earlier, our pavements would have been gritted?