City councillors to reject plans on privatisation

Steve Cardownie
Steve Cardownie
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Plans to privatise a series of council services in Edinburgh look set to be rejected by councillors, despite estimates showing it could save an extra £13.5 million.

The SNP group on the council has indicated that it will refuse the proposal to hand private firm Mitie Group the contract to take over services including janitors, school meals, cleaners and porters.

The move comes after council chief executive Sue Bruce had recommended approving the “integrated facilities management” (IFM) contract.

Labour and the Greens are also intending to oppose the plan, while the Conservatives are expected to back the proposals. The Liberal Democrats have not made a final decision.

A combination of the SNP, Labour and the Greens should be enough to defeat the plans.

Council chiefs have already recommended that a separate batch of services under the banner of “corporate and transactional services” (CATS), including HR, payroll, IT, call centres and revenue and benefits, are rejected and kept in-house instead.

Councillors last month refused to back plans to hand bin collections, street cleaning and ground maintenance to private firm Enterprise.

Councillor Steve Cardownie, leader of the SNP group on the council, said: “Our group met last night and moved that we reject the officials’ recommendation and instead support the public sector comparator.

“The IFM option does not give enough of an advantage to entice us to hand out work to the private sector, and we believe the figures are all predicated on a lot of supposition.

“The SNP has a presumption against privatisation and we have not been convinced to change our stance on this.”

He added: “As with the environmental services bid, we believe it is better to retain the work in the public sector.”

The IFM contract covers services that affect 1200 jobs and are worth around £61m a year.

The Mitie bid would save a guaranteed £51.5m over seven years, as well as the potential of a further £63m of savings, compared with £38m of savings, possibly rising to £63m, in an alternative “in-house” bid.

Council leader Jenny Dawe indicated that she is considering backing the plan to outsource, although her group has not yet come to a final decision.

She said: “At this moment, I can see considerable virtue in the officer recommendations, and my reading coincides with theirs, but I have not yet come to an absolute conclusion.

“On CATS, I have no difficulty in seeing that the most sensible way to go ahead is with the public sector comparator, but not as it stands. To my mind, it is not deliverable as it is at present.”

Despite considering backing the Mitie contract, she said that the case for it is “not as overwhelmingly compelling” as she thought the environmental contract had been.

John Stevenson, president of the Edinburgh branch of the trade union Unison, said: “At the very beginning of this process, the council was clear that it had to show a compelling case to privatise and that the preferred option was to stay in-house. Certainly, there is not a compelling case in either area.

“We would argue that the in-house option is better value and will provide a better service. There is so little to be gained [from privatisation] in that there would not be a significant improvement and it would bring in all sorts of other bureaucratic problems.”