Since the outset, I have been questioning the length of the One Barnet contract. In particular, I have repeatedly asked why we needed a ten year contract. The response from the Council has been the length of contract is necessary to recover the investment made by the contractor. Indeed, I think this was the point made by that knowledge Councillor Rowan Quigley-Turner at the Business Management Overview and Scrutiny Committee meeting last October
We have now found out that in fact Barnet Council have funded £16 million of investment. This is a fundamental change to the terms that were originally set out when the council made the decision to appoint Capita. Certainly there was absolutely no mention of the Council funding the investment when the decision was taken by Cabinet in December 2012.
I remain concerned that making such a fundamental change to the contract, post award, breaches EU tendering rules - unless it was previously agreed and cabinet were aware but the deal was kept secret. However, setting that aside, the response from the Council should have been to seek a reduction in the length of the contract. Limited investment = shorter contract term; that is standard business practice. This could have been Barnet's opportunity to cut the contract to, say, five years with a break clause at three years but this didn't happen. This is a serious and naive error demonstrating to me that there is a lack of financial rigour by those administering this contract.
As a final point, Barnet have now invested in excess of £26 million in this contract, including over £10 million on professional advisors. Just think what an in-house team could have delivered with just half that level of investment. But as we all know One Barnet has been one of the most successful con jobs in local government history.