Monday, 20 August 2012
The new One Barnet Joint Venture: a joint statement by the Barnet bloggers, and an open letter to leader Richard Cornelius.
Dear Councillor Cornelius
At the end of last week, an email was sent by Pam Wharfe, Interim Director of Environment, Planning and Regeneration to employees of Barnet Council in which it was casually revealed that one of the two One Barnet outsourcing projects, the outsourcing of c.£275 million worth of council services, is now to be redesigned as a "joint venture" in a new company comprising the bidder and the local authority.
This remarkable development raises several hugely important questions.
In the email, Ms Wharfe makes the rather disingenuous statement that the new organisation provides "...an effective basis on which the Council can benefit from these opportunities and at the same time it gives the Council greater rights of transparency and control..."
The loss of democratic accountability to the community in the provision of services that would result from the outsourcing of the One Barnet programme is an issue we and other critics have raised repeatedly, yet is an accusation the council has continually rejected.
Whilst we are pleased to see that the authority has now accepted that our concerns are valid, we fail to understand how the creation of a new commercial venture will improve the ability of the council to retain proper controls and transparency in regard to the services outsourced in this way.
The new arrangement also raises the real risk of conflicts of interest regarding the management of the new venture and those who will be involved in the decision making processes of the organisation. Bearing in mind the failure of the council to mitigate the potential risks posed by any senior officers with links to private companies involved in the bidding process, what safeguards will be in place in relation to the membership of the new board?
Most significantly, perhaps, the new venture would appear to move the burden of significant risk from the private sector partner to the taxpayers who will be expected to fund the new company, whilst any profits that may ensue will not return to residents, but will be shared with the commercial partner. If the venture fails, residents will bear the cost of failure, and the need to re establish all in house services – if possible.
In short, the joint venture might fairly be described as nothing less than the outsourcing of profit, and a desperate, last minute agreement to carry the full risk of catastrophic failure in order to sustain, in the face of mounting disquiet from all quarters, the One Barnet outsourcing programme.
We ask why the Conservative administration has decided on this sudden course of action, at such a late stage in the dialogue process, and remind you, Mr Cornelius, that when the original case for outsourcing was made, your own consultants' report stated:
"The costs and risks associated with a JV model are judged at this stage to be higher than for a Strategic Partnership."
As we have so often pointed out, the undoubtedly high risks of entering into a Strategic Partnership have never been subjected to any independent assessment, or indeed any form of real scrutiny, yet here you are now, committing the financial security of our borough to what has been clearly identified as an even riskier and more costly strategy.
We might also speculate to what extent this radical departure, at this advanced stage in the dialogue, has exposed the council to risk from legal challenge by companies who have been excluded from the dialogue at an earlier point in the proceedings.
In respect of the need for democratic accountability, we would also question on what basis, and on whose authority the council has taken this decision: was the change in policy debated within the Tory group, or the Cabinet, or is this another development driven by the senior management team?
The mass privatisation of One Barnet will have a devastating impact on the daily lives of Barnet residents, as the need to make profit inevitably comes into conflict with the provision of public services, that is to say the support on which depend so many of the least advantaged and most vulnerable members of our community. All studies have demonstrated that the savings you imagine will transpire as a result of privatisation simply will not materialise, and indeed the whole enterprise is more likely to cause more cost to the local taxpayer, as well as a sharp decline in the standard of service.
By the time the full extent of the damage to the well being of this borough becomes evident, it will be too late to wrest back control of services without enormous difficulty and an intolerable burden of further cost. The senior officers who have driven the outsourcing agenda will no doubt be far away from Barnet and it is equally likely that you and your Tory colleagues will be voted out of office at the very first opportunity.
As residents of this borough we ask you to come to your senses and call an immediate halt to the One Barnet programme. Stop listening to the self serving advice of the private sector companies and the senior officers who are promoting this agenda, and take a look at the answer right in front of you – the in-house solution. With the support of the staff you employ you can work together to achieve the efficiencies you need and avoid the dangerous gamble of One Barnet: now is the time to act, before it is too late.