The Draft London Plan & Why I think It's Fatally Flawed

 It's been a while and I thought my blogging days were over but having read the draft of the New London Plan I felt compelled to write down my thoughts as to why I think they have got it so badly wrong and how it could be so much better. 

By way of context, when Andy Burnham became Prime Minister he said something that struck a chord with me. "When I say we need good growth in every postcode, I mean every postcode across the whole of the UK. Every place and every person matters". Spot on Andy. For so many decade we have seen the regions struggle as London and the South East has hoovered up so much of the UK's economic growth. This has led to crazy property prices in London and a developer driven land grab which prioritises housing over just about anything else. Worse still, the quality of housing seems to come as a much lower priority to the quantity of housing. It is also a 'pile them high sell them dear' strategy. With two adult children who see no future in London as they will never be able to afford even the cheapest 1 bed flat in London, we seem to have reached a really desperate point in history where communities become increasingly transient or for the super rich.

The starting point for the latest draft of the London Plan, which you can read here is that, 

" On past trends London is expected to add as many as 1 million more additional residents over the Plan period - growing to a population of over 10 million. A huge increase in housing delivery is needed to both accommodate future growth and address the chronic shortage of homes for existing residents". 

However, the key question is where are these 1 million more people coming from. Is it natural growth from current London residents? Answer, absolutely not. Birth rates in London are declining with many Londoners moving out of London to more affordable accommodation outside the capital. All of the current growth is from inward migration both international and domestic. UK immigration fell to  171,000 in 2025, and some are forecasting that by the end of 2026 net migration could be negative.

On that basis the 1 million plus growth in London's population over the next 10 years seems to be largely driven by UK migration and something which seems counter to what Andy Burnham wants to achieve with "good growth in every postcode". Do we need to build more housing in London - absolutely - but the key criteria is what type of housing and for whom. Historically it is the developers who have called the shots and they have built what is most profitable for them. As a result we have seen a massive growth in small 1 and 2 bed flats. Indeed the GLA's own study "Assessing delivery, challenges and opportunities of the Mayor’s Affordable Homes Programme" noted that only 4% of affordable homes built in the last 10 years are 4 beds or more and that 78% were studio, one and two bed flats. This has exacerbated the migration of families out of London but has also led to the situation where 1 in 21 children in London live in temporary accommodation.

But coming back to the London Plan's target to meet the 1 million plus population growth, the plan is requiring London Boroughs to build 558,000 new homes. The London Plan also states that "the Mayor remains committed to a strategic target for London of 50 per cent of homes to be genuinely affordable over the longer-term plan period". Unfortunately that is nothing more than an exceptionally hopeful wish with all fingers and toes crossed because everyone know that it will never happen.  In Barnet we saw the example of Intec House at Moxon Street. Originally it was planned as 100 flats with 35% affordable. The developer then came back saying the scheme was not viable so cut all of the affordable homes. The scheme was eventually approved again but a taller building with more flats and less employment space and just 15% affordable homes.

Barnet have been set the target of delivering 32,730 homes over the next 10 years of which 7,000 will be built on the Green Belt. That means at least 60,000 increase in population possibly closer to 80,000 given the number of incomes needed to afford even the most basic of new homes bringing Barnet's population close to 500,000 people. Two things immediately spring to mind; the first is where will all the jobs come from and the second is what additional infrastructure will be need to meet the needs of a half million people borough.

So let's look at what the London Plan says about employment. Their employment forecast evidence runs through till 2050, well beyond where the house target plan of 2036. It states that the number of additional jobs created in Barnet between 2025 and 2050 is just 12,000 or a compound growth rate of just 0.3% per annum.

Most of the employment growth will be in Inner London with Professional, Scientific, Technical and Real Estate activities (+373,000 jobs from the 2024 level) and Information and Communication (+164,000) accounting for around half of the projected increase between 2024 and 2050.  Four sectors are projected to see declines over the projection period: Manufacturing (-37,000 jobs), Transportation and Storage (-34,000), Wholesale (-32,000), and Retail (-32,000). 

So at best, Barnet will become a dormitory for Inner London, but more seriously it looks like an increasing social divide losing lower skilled and lower paid jobs fulfilled by existing local residents and replaced by higher skilled higher paid jobs filled by people currently living out of London. In Barnet we used to have one Strategic Employment Site which was the North London Business Park, but that was redesignated for housing because the housing developers could always pay more for the land that an employment business. 

So coming back to the initial quote from Andy Burnham about good growth in every postcode, it seems like the London Plan continues to reinforce the migration into London at the expense of the regions and runs counter to what he wants to achieve. Historically, the huge housing targets in London have driven up demand for land making it uncompetitive for many industries as housing developers always seem to be able to pay more for development plots. One industry that does have the money has been the data centre sector which is seen as the essential building block of the AI revolution. The London Plan has an entire supporting evidence report all about data centres where is says that as of November 2025, there are 99 operational data centre sites and 26 in the planning pipeline, predominantly north of the Thames. The report notes that: 

"Data centres are a vital component of London’s growing digital economy, as recognised in the London Growth Plan1. London’s position within the FLAP-D data centres markets reflects its global economic significance, high connectivity, and proximity to end-users". 

The problem is that data centres demand huge amounts of electricity and water, both of which are under extreme pressure in London. The report notes that, "Electricity resilience is critical, as grid constraints and surging AI-driven demand push operators toward robust redundancy measures. This includes widespread adoption of N+1 UPS systems (back up power supply with additional capacity), on-site generation, and battery storage to maintain uptime and mitigate risks from delayed grid reinforcements. These strategies are increasingly seen as essential for hyperscale facilities where even short outages can have significant financial and reputational impacts. Water consumption is another major consideration. A 100MW hyperscale data centre in the UK can consume up to 2.5 billion litres of water annually, equivalent to the needs of approximately 80,000 people, driving the shift toward closed-loop, air, and liquid immersion systems to reduce reliance on potable water."

This is supported by Affinity Water's Report  "Running Dry -  England's Water Security Crisis" which states that:

 "Within Affinity’s region approximately 125 data centres are either proposed or under construction, with some individual facilities requesting supplies of up to 35 litres per second, equivalent to the peak water demand of 3,500 homes.15 One proposal sought to consume 21ML/d, the equivalent to circa 147,000 people. The planning framework is built around household growth and per capita consumption and has not adapted to commercial users whose water needs can match those of a market town."

Taking Andy Burnham's desire to spread economic growth in every postcode then the most obvious location for a major hub of data centres is not in London but in the West Country where the transatlantic data cables come ashore and close to Hinckley Point nuclear power station. It's also important to note that annual rainfall on the north coast of Devon/Cornwall is between 50% and 100% more than London.

This leads into the broader infrastructure issues for London. The new London Plan notes that there will be a significant requirement for health facilities but leaves it up to the Integrated Care Boards to deliver the capacity. 

The problem in Barnet is that major developments have already taken place yet the infrastructure has failed to deliver. In New/East/High Barnet we have around a 1,000+ flats/houses planned or nearing completion yet our local Integrated Care Board failed miserably to secure new GP premises. Barnet General is under huge pressure currently but another 60,000 + residents are only going to make matters worse. So where will patients be treated, will there be sufficient GPs or dentists? Pressure seems to be off school places simply because families are moving out of London to find more affordable accommodation outside London - the overall forecast for London is 1 million more adults but an actual decline in the number of primary school age children.

It is also interesting to note that the forecast population increase will require an estimated 1,900 prison places, something which is particularly challenging when we already face a prison overcrowding crisis and early release of prisoners. 

The last point is about the quality of the environment and creating great places to live. The London Plan seems obsessively focused on housing numbers at the expense of the environment in which we live. North Finchley Leisure Park is a good current example. There is a large multi screen cinema, multi-lane bowing plus restaurants and the leisure centre. Since it was built in the 1990's it has been an important social hub for families in Barnet yet this is now being redeveloped for high density housing. The cinema and bowling capacities are being scaled back and will now be on the Lodge Lane car park in North Finchley - more people, fewer facilities. Worse still the new London Plan says that 7,000 new homes must be created in the Green Belt which seems to be focused around Mill Hill. This was originally planned to be a regional park, something which people could enjoy and gain emotional refreshment but now it will just be more housing.

So where does that leave us. We know we need additional housing in London to meet the shortfall that already exists but from my perspective we should be creating incentives for employers to move out of London to the regions helping to take the heat out of the housing market. Housing that is built needs to be genuinely affordable and I welcome Angela Rayner's announcement of nearly £10 billion of allocations to build thousands more quality council, social and affordable homes with £6 billion allocated for London. I just hope that they can be delivered quickly and in a way that encourages families to stay in London. I think the new draft London Plan needs a complete rethink, not just focusing on housing but on what makes London a great and affordable place to live, and if it stays in its current form it will only make the housing crisis in London worse and continue to suck economic growth from the regions. 

Come on Andy, make sure you deliver growth to every postcode and stop London becoming the home for the transient and super rich.

A bit of context for Barnet's current financial mess - the £41million shortfall

 It's been a while, but the current financial crisis in Barnet deserves some context as this mess has been 15 years in the making. I have been following Barnet's finances since 2010 and I have made regular comments on the financial strategy. 

One thing I have commented on repeatedly is council tax freezes. Some may say it was a great thing as it kept council tax costs down for residents but in reality it is just kicking the problem down the road. The council tax element was frozen between 2010/11 and 2018/19 - they did include a social care precept between 2016/17 and 2018/19 but the council tax element remained frozen and in 2014, just before the election, they actually cut council tax by 1%

Well, in 2025 we have reached the end of that road and it looks like a disaster of epic proportions. Often council tax freeze are driven by political decisions not rational logical decisions. A great example of this was in 2012 when the plan was to increase council tax by 2.5% but the plan was scrapped and a demand by senior politicians for savings to be made instead - you can see the blog a a video of the meeting here. 

I have always said that freezing council tax for one year has long term implications as you are, in effect, reducing the council tax base by that amount every year going forward because each future year's calculation starts from that lower base.

I blogged about it again in 2013, 2014, 2017 and again in 2018 making the same point that this was storing up massive problems for the future.

I decided to go back and update all the figure with a more detailed analysis of the impact of the freezes. Set out below is a graph which shows the impact of these freezes.

Getting into more detail I have set out in the table below, the basis of the figures. I tried to be as accurate as possible using not just the revenue figures but also the number of properties in paying council tax - the council provide the number of Band D equivalent properties as part of their calculations in the Council's Annual Budget Book/ Financial Forward Plan and Capital Programme

What the figures show is that if Barnet had taken modest rises of 1.99% every year instead of freezing or cutting council tax, by 2022 there would have been £41m a year more revenue coming from Council Tax. National government must also bear some of the blame as for a number of years the government subsidised council tax freezes for that specific year. But the problem is that a subsidy is only for one year but the freeze represents a recurring loss.

Labour are not entirely blameless as the year after they came in they reversed the 1% increase in council tax made the previous year by the Tories. The big problem is councils are around for the long term but politician come and go and the decision they make are often very short term and politically motivated. The residents of Barnet now face the consequences of those actions.

It is also interesting to not that the cumulative lost revenues over the period 2010/11 to 2021/22 is £273million which maybe could have been spent on improving the infrastructure and services in Barnet. The old saying, "you get what you pay for" is truism but it has consequences and we are seeing them realised now.

How covid victims' families are being ignored by Baroness Hallett and how people with disabilities were failed during the pandemic

I haven't blogged for a while as I have been a bit unwell but I received an email yesterday from someone in Barnet who I admire immensely and I feel compelled to pass on his story. 

John  & Ida Sullivan had a daughter, Susan, who I met on a number of occasions at various campaigns and marches about the Barnet Council under the previous Conservative regime. Susan, who had Downs syndrome, was a very lively and cheerful person. I didn't know until I listened to the podcasts, just what a talent Susan had as a swimmer, winning numerous medals at the Special Olympics. Sadly she caught covid at the very start of lockdown in March 2020 and died shortly after. What is shocking are the details John reveals in two podcasts:

https://goingviralthepod.libsyn.com/the-dancing-queen

https://goingviralthepod.libsyn.com/who-do-we-not-save

What I learned from these podcasts is how people with disabilities were treated differently and inhumanely during covid, how hospitals ignored the knowledge, experience and wishes of carers. According to research 6 out of 10 people who died from covid were disabled. John and his family discovered that because Susan had Downs syndrome and a pacemaker she was denied access to the ITU at Barnet General and deemed "not for resuscitation" even though her family had asked for her to be resuscitated and until covid she had been in excellent health.

John wants to give his evidence of how Susan was unjustly treated to the Covid Inquiry chaired by Baroness Hallett but sadly he will not be able to do so but instead a large amount of personal evidence will be 'amalgamated' by a research company into 'Every Story Matters' where "stories will be collated, analysed and turned into themed reports, which will be submitted into each relevant investigation as evidence. The reports will be anonymised". John doesn't want Susan's story amalgamated and anonymised. All Baroness Hallett was asked to do by the legal team for the bereaved families, was to hear the witness statement of just 20 families, and she refused. Making time for those 20 families seems entirely reasonable and fair in an inquiry where public hearings are scheduled to concluded Summer 2026. Surely there must be room to hear those 20 families in such a lengthy timetable.

At one point in the podcast John says "The only voice my daughter has got is me. I will, to my dying breath, fight to give Susan that voice, and all the other Susans, at the Inquiry."

I hope that Baroness Hallett thinks again and allows the victims' families to give their experience to the Covid Inquiry in person so that the real story of how so many disable people died during covid can be heard and lessons learned.

Latest spending figures from Barnet and a 'blast from the past'

 Latest supplier payments are out and as the Capita Re contract draws to an end we see how much we are still paying Capita. In February we paid them £2.77 million on the CSG contracts and £503k on the Re contract. That brings the total to date to £641 million and we still have some payments to go. The Re contract has just ended so hopefully we will see the final payments at the end of the month when they are published. Barnet have extended the contract for a number of elements for the CSG contract so we will have a further three years of payments on that contract.

The spend on agency staff remains high and with one more month to go before year end it looks like we have already exceeded last year's spend at more than £17.3 million and are on course to hit the highest level since the peak in 2016/17. I hope someone is keeping a very close eye on this spend.

I was also interested to see a name I recognised from some while ago. Impower Consulting are, I believe, the same company that, alongside Agilisys, previously provided advice to Barnet on the mass outsourcing of services back in 2012 for the Capita contracts. They are definitely the same company who, in 2015, helped outsource the education services including school meals. Sadly the school meals ended up being sub-contracted out to another company so that the Council had no direct contractual relationship with the school meals provider and the education services contract was handed back to Barnet as soon as Covid hit in 2020, three years ahead of the planned contract expiry date. You can read about it here. This year to date we have paid Impower £133,692.96, a not inconsiderable sum. I hope it represents genuine value for money.

We have also spent £110,528 with a company called Peoplescout, a 'talent solutions' company which I think means recruitment. With all of the Re contract being brought back in house I suspect the cost of recruitment companies will be higher than normal but is something I will keep an eye on.

Finally is Brent Cross, where so far this financial year Barnet have spent £50.6 million. This follows on from £77.1 million spent in 2021/22, £70.8 million in 2020/21 and £45.5 million in 2019/20. I hope that all this expenditure is going to be worth it in the end.

I continue to keep an eye on Barnet's spending.

Latest Capita Spending

 Latest spending figures are out and the Capita contract continues to cost us a fortune. In January Capita billed an additional £3.2m on the CSG contract and £620k on the Re contract. The latest running total is £638 million.

The spend on agency staff continues at a worryingly high level and looks like it will hit £18.7 million by the financial year end (31 March).

Capita continuing to disappoint in the death throes of the Re Contract

 Apologies for not having posted a blog for a couple of months but I am still monitoring Barnet and the Capita contracts.

The latest spending figures show that Barnet have now paid Capita £634 million which is £273 million more than the contracted value even though some services included in the contract value have already been brought back in house such as Finance.

I watched the Audit committee in January where Capita were requested to attend to talk about their performance. You can watch the Audit Committee meeting here and the part where the director from Capita participates starts at 27 minutes 20 seconds into the meeting. What is most disturbing is that now the contract for Re is coming back in house at the end of March Capita seemed to have given up on rectifying problems that already existed. Performance failure and the inability to meet deadlines was repeatedly raised. At 41mins 14secs, one of the independent members of the Audit Committee does some plain speaking about Capita's performance which has been poor and is definitely worth watching.

While the Capita Re contract will come back in house on 1st April there are still significant elements of the Capita CSG contract will continue to be operated by Capita for another three years and that fills me with serious concerns. Barnet is a case study in how not to outsource services, with overly complex contracts and weak monitoring. I will keep watching Capita's performance.

Looking back almost twelve years - the pledge I made that was never accepted

 I was going through Barnet's supplier payments for October 2022 (£71.7 million) and I cast my mind back to January 2011. At that time the council implemented something called Pledgebank where residents could pledge to carry out some activity on behalf of the council/community. My pledge was as follows:

“I will pledge to give up 4 hours of my time every month to scrutinise and challenge all invoices over £10,000 to help the Council reduce unnecessary spending so long as five other people will make a similar time commitment to sit on the panel and that Barnet Council will genuinely participate in the process and listen to the advice and opinions given.”

Strangely, the council never took me up on my pledge although, rather than decline it, they left it hanging, "undecided" as they put it. You can read about it here.

Why I raise it now is that when costs are so tight and we potentially face serious cuts to services due to the impact of the crazy mini budget of 23 September, every penny spent must be carefully watched and if necessary challenged.

This month, excluding redacted payment, we paid 1,021 suppliers £69.27 million. The top 20 suppliers were paid £48.83 million or 70.5% of the total spent. Looking at individual payments there were a total of 14,811 of which 521 were for £10,000 or more, around 3.5% of the total invoices. Excluding payments to statutory authorities, that number falls further. Maybe now is the time to revisit that pledge?

Barnet also spent just over £2 million on agency staff in October which brings the year end forecast to £18.2 million, up on last year and set to be close to the peak year of 2016/17.

And just to update you on Capita, the running total is now £622.74 million. Scrutiny is more important than ever.

Capita still costing us a fortune

 I was a bit worried that the supplier payments still had not been published for September 2022 so I dropped a quick email to Barnet yesterday. Almost by return, they came back saying thanks for pointing it out but they had been published the figures somewhere else on the website by error and that had now been corrected. Since the finance function has come back in house they have always been helpful and very responsive.

What the figures do reveal is the bill for Capita continues to mount even though the end of the contract is in sight. In September we were billed £5.13 million on the Capita Re contract and £3.39 million on the Capita CSG contract, both chunky numbers.

The running total since the start of the contract is now £618.61 million, £257.73 million more than the contracted value.

It is also important to remember that the contracted value includes the cost for services that have already been brought back in house such as finance so the true cost is even higher.

Other noticeable costs include the running total for agency staff at £8.5 million with a forecast year end cost of £17.1 million.

It is also worth noting that, in the first six months of this year, Barnet have paid out £28.57 million on the Brent Cross project. I remain concerned at the level of risk Barnet is exposed to on this massive redevelopment project.

Listening to what is happening at other local authorities, I think we are in for a serious financial squeeze with the impact of inflation on pay rises, increased energy and construction costs, and contracts which include indexation clauses (such as the Capita contract). Now more than ever it is essential that there is a high level of scrutiny on every pound spent within Barnet. 

As always, I will keep monitoring the spending at Barnet.

What we are paying Capita

 Even though large parts of the Capita contract will finish next year, they continue to bill Barnet for their charges. The running total is now £607.7 million, £246.8 million more than the contracted sum.

As readers will know, I also review every single invoice Capita have submitted during the Inspection of Accounts period which give residents the right to inspect bills, invoices and payments. This year it was 381 invoices for a total sum of just under £50 million.

Within that figure there are some interesting numbers. £4.49 million was for 'indexation' of their fees. I have raised this with the council on numerous occasions saying that no other council service is guaranteed to get RPI increases every year so why do Capita? This will be a major issue over this financial year when RPI in August was 14.2% (significantly higher than the more accepted CPI rate).

£805,261 was paid to Capita for 'E Test & Trace' work. I just hope we are able to recover that from central government. We were billed £979,727 for the 'Network Recovery Programme' for which read road repairs. Now my understanding is that this figure is not for things like tarmac and pneumatic drills but simply staff to manage the programme.

Brent Cross is a major project to which Barnet has already made a massive investment including £77 million last year alone. The project management of the new Brent Cross Thameslink station was taken away from Capita and given to Mace but Capita still managed to bill £815,880 in fees.

There remains the infamous gainshare clause whereby Capita get to keep a proportion of any savings they make. It was phased out on procurement after many years of me complaining that it was a flawed system (you can read some of the old examples here) but it is still in operation of some other areas. This year we paid £300,015 gainshare on Council Tax and Housing benefit overpayment recovery. Given that Capita administer both these services one would have hoped they got it right first time. A further £221,160 gainshare was paid for reducing council tax single person discounts.

Capita also set thresholds for the number of council tax and benefits enquires they deal with. If the number is exceeded, we get billed an additional charge known as a volumetric charge. This year that amounted to £122,075, less than in previous years but still a lot of money.

In special projects, £2,749,758.83 was paid to Capita on various elements of the Hendon Hub project, one which has drawn very significant opposition and legal challenges. They also billed £1.66m for various IT projects.

In today's Barnet Times (22 September 2022) we see yet another example of poor performance in the Capita contract and that the representative from Capita refused to attend the Audit Committee to answer any questions. While a decision has been made to end the Capita contract, some elements will be continuing for another 42 months. The need to monitor and challenge the performance and cost of the Capita contract continues until the very last day. 

Capita - they may be going but costs continue to grow

 I have been tied up for the last couple of months with the planning inquiry on the proposed redevelopment of the former gasworks in New Barnet. I will be producing a detailed blog once we have a decision from the planning inspector but in the meantime I though I had better refocus back on to Capita.

I was delighted that Barnet's new councillors have decided the Capita contract will end before the next election. The Re contract will end when the contract expires this time next year with a few of the remaining services such as IT and customer services being delayed while alternative arrangements can be put in place. However, that doesn't mean that I will stop monitoring the costs and in June there were some large bills, especially on the Re contract. set out below is the latest update 

Later on this month I will be inspecting all the Capita contract invoices as part of the Inspection of Accounts process for the year 2021/22. I want to check what the £49.95 million was actually spent on, especially the £13.95 million that was in excess of the contracted value. So far we have paid Capita £604 million and that deserves scrutiny.

One other area where spending seems to be running high is the agency cost budget. Agency costs peaked in 2016/17 at £19.87 million. After many challenges from me, especially to the Comensura contract who managed all of the agency spend, we saw the agency bill decline significantly until Covid struck when, not surprisingly, the agency spend increased. I was expecting the agency spend to drop back down to where it was in 2019/20 but the first three months of this financial year suggests that on the current burn rate, it may hit the 2016/17 peak of £20 million.

A couple of other large bills this month include the on-going cost of Brent Cross Thameslink station where this month we paid £3.6 million to Network Rail Infrastructure and £2.15m to Volker Fitzpatrick which were part of the total £6.4 million spent on Brent Cross.

We also paid £515,383 to PA Consulting in June with the cost allocated to the Adults & Health department. I suspect this relates to the on-going issue of the Mosaic casework system which was originally planned to be implemented by Capita but was taken away from them when the project failed to deliver. If I am wrong I am always happy for someone at Barnet Council to tell me what it was spent on.

As always, I will keep monitoring the spending.

Capita and Fly Tipping - a short update

 As I have been tied up preparing for the Victoria Quarter Planning Inquiry this will be a short blog.

The first point to mention is Capita. Labour may have won control of the Council but we are still stuck with  Capita until September 2023 at the earliest. The latest figures show the bill continues to climb at just a whisker shy of £590 million.

Let's hope that between now and next year, the contract is brought to a close and we can regain control over these costly services.

The other thing I picked this week was the success or otherwise of penalising people who litter. This is a service that was also outsourced to Kingdom Services Group Limited. In the period February 2019 to November 2021, the contractor issued 8,760 fines for various forms of littering. The two largest categories are for dropping cigarette butts and fly tipping which together amount to 80% of all the fines issued. However, this is where things start to differ. Of the fines issued for cigarette littering, 65% are paid whereas for fly tipping only 16% of the fines are paid.

If people know they don't have to pay a fine, it stops acting as a deterrent. I asked about this problem three years ago and I was told then, "it takes longer to recover the fines for fly tipping". Sorry but that doesn't wash. For fines between January 2017 and December 2018, 25% of general littering fines remain unpaid but 57% of fly tipping fines in the same period are unpaid. I suspect it falls into the "too hard" category but if fly tippers know they have a better then 50% chance on not paying their fine, even if they are caught, then it is no surprise they keep fly tipping. 

Ending the Capita contracts - time is running out

Labour won control of Barnet last week with a large majority. They will be under serious pressure to make lots of changes to the way the council is run but I would plead that the two Capita contracts should be a top priority.

As I have said for the last 9 years, the two Capita contracts do no favours for Barnet residents. The catalogue of failure has been well documented on this blog, and as part of the review that has been dragged out over the last two years, it is evident that bringing services back in house can either directly save money or provide a better, more competent, service. 

The looming problem Barnet Labour Cllrs face is that, because the previous regime delayed the decision on whether or not to extend the contracts until after the election, it has left just 3 months to take that decision or face having to extend the contracts for at least another year simply because the transition arrangements haven't been put in place.

Both contracts expire on 5th August 2023 but there are specific clauses which relate to what has to take place to meet that expiry date. 

In the CSG contract it states at 47.3.7 that: 

On or before a date falling no later than twelve (12) months prior to the Expiry Date (where this Agreement expires by effluxion of time) or during the period from service of any Termination Notice until the Termination Date of this Agreement, the Authority shall notify the Service Provider in writing whether it wishes to retender the provision of the Services.

It then goes on to clarify at 47.3.9 that:

If the Authority does not wish to retender the Services then the Authority will indicate which Service Provider Exclusive Assets and Service Provider Traded Service Assets (or part of the Assets) shall transfer to the Authority on the Expiry Date or Termination Date in accordance with clause 5 (Assets and Equipment) and the Service Provider shall promptly undertake all necessary actions by the Expiry Date or Termination Date (as the case may be) including any further actions required pursuant to clause 5 (Assets and Equipment).

Probably the most critical element is the transfer of data and the transitioning of the IT system. When Southampton Council took the Capita contract back in house it took them 12 months to set up their own systems and transfer all of the data.

In the CSG contract it notes at 47.3.2 that 

The Service Provider shall (subject to any condition imposed on the Service Provider or any Sub-Contractor by Legislation):

(d) no later than six (6) months and no earlier than twelve (12) months before the Expiry Date, supply to the Authority within twenty (20) Business Days of the relevant date or request all information reasonably required by the Authority to carry out the Services (including but not limited to information (subject to the DPA) referred to in Schedule 33 (TUPE Information for Retendering) in relation to employment of all employees of the Service Provider or any sub-contractor (including the Sub- Contractors) employed in the provision of the Services and information relating to the Assets and Authority Assets) and the Service Provider warrants that at the point when given and, to the best of its knowledge and belief, such information is accurate in all material respects.

At 47.4.7 Surveys on Expiry or Termination - Final Survey, it states:

twelve (12) months prior to the Expiry Date or during any period leading up to the Termination Date, the Authority shall be entitled to procure the carrying out by a suitably qualified independent surveyor (not being an employee of the Authority) of a final survey of the Assets and Authority Assets to assess whether they have been and are being maintained by the Service Provider in accordance with its obligations under clause 6.1 (Maintenance).

At 47.4.5 Retention Fund it states that:

If the Service Provider has been notified under clause 47.4.3 (Results of Survey) that rectification and/or maintenance work is required, twelve (12) months prior to the Expiry Date or in the period prior to the Termination Date the Authority shall (to the extent that the Outstanding Work has not been carried out in the interim) deduct the costs of that work as quantified by that survey referred to in clause 47.4.1 (Final Survey) from the next following instalment (or, if the amount of such instalment is insufficient, the next instalments as necessary) of the Periodic Service Payment and pay such amount into an interest bearing account (the Retention Fund Account) until this Agreement has expired or terminated (subject to clause 47.4.6 (Costs).

At 7.3.2 it notes that: 

Six (6) months (or such other period agreed to by the parties acting reasonably) prior to the Termination Date or Expiry Date (as applicable) the parties shall agree:

(a) which of the contracts used in the provision of the Services shall transfer (either by novation or other mechanism) to the Authority or Future Service Provider (the Transferring Contracts);

(b) the costs and a reconciliation of any payments made in advance or arrears in respect of the Transferring Contracts on the basis that the Service Provider shall be responsible for all costs and charges which arise prior to the Termination Date and/or Expiry Date (as applicable) and the Authority shall be responsible for all costs and charges which arise after the Termination Date and/or Expiry Date (as applicable).

(c) the process and timetable for transfer and handover of management responsibilities in respect of the Transferring Contracts together with the provision of relevant documentation and information in respect of issues such as performance and payments to date.

This will require a lot of pre-planning and that needs to start very soon so that by 6 months before expiry you know exactly which contracts you want to retain.

The Re Contract is a joint venture and as such the unwinding process is more complex. In that contract it states at clause 2.3 that if Barnet wish to extend the contract by 5 years then that notice has to be provide 18 months before the expiry of the contract. This is repeated at clause 55.3.6. I just hope that the previous regime did not provided that notice.  

At 27.1.1 it states that:

Subject to clause 29.2.4 and 29.2.5 in the event of termination or expiry of this Agreement the Authority shall have the option exercisable within six (6) months of the Termination Date or Expiry Date to:

 a) purchase from the Service Provider at their Net Book Value any or all of the Exclusive Asset(s), unless:

 i. the cost of any such Exclusive Asset(s) has been fully paid for through the Periodic Service Payment or otherwise amortised at the time of expiry or termination of this Agreement; or

 ii. any such Exclusive Asset(s) were transferred and delivered to the Service · Provider as Initial Transferring Assets in accordance  with clause 29.2, and in which case such Exclusive Asset(s) shall be transferred to the Authority at nil cost; and

 iii. the cost of any such Exclusive Asset(s) has been partly paid for through the Periodic Service Payment or otherwise partly amortised at  the  Expiry Date or Termination Date then a proportional part payment shall be deducted from the Net Book Value;

 (b) receive (or a nominated party receives) a non-exclusive licence on reasonable commercial terms and at a reasonable commercial rental for the non-exclusive use of the Shared Assets (or a part thereof as nominated by the Authority);

At clause 30.8.1 the final survey (similar to the CSG contract) can be carried out 18 months prior to the expiry date and at 30.8.5, the Retention Fund, as with the CSG contract should be identified 12 months prior to the expiry date. 

In each contract there is an entire schedule  (Schedule 17 in the Re Contract and Schedule 18 in the CSG Contract) specifically relating to the exit arrangement and includes, for example, the requirement for Barnet to appoint an 'Exit Manager'. Capita have to have an exit plan already prepared which they have to update annually. It will be critical to see if that plan is up to date and the extent to which they have assumed the contract will be extended.

My biggest fear at the minute is that the new Labour regime will be told by officers that this fall into the "too difficult" category and that the proposals identified by the previous regime should be enacted. That would be a disaster, would limit what changes could be made to the way the council is structured and critically, would signal that Officers make the key policy decision, not the elected members. Time is short to take decisions, because the last scheduled full council meeting before 5 August is on 26 July, just 10 weeks from now. Please don't waste that time otherwise we will be stuck with Capita for years to come.

Please read this before you vote

 It is the local election on Thursday, the one and only time in the four year cycle when the council actually have to pay attention to the views of residents through the ballot box. 

There is a lot of spin at this time but I just want to look back over the last four years since the last election and see what has changed for the better or worse. 

Council Tax has risen significantly over the last 5 years and no matter what Conservative councillors may say, the council tax has risen every year, including this year - so no, not a freeze. Set out below is a chart showing the increase year on year. (This excludes the amount paid to the GLA)

In addition, if you have a green bin, you now have to pay an extra £70 a year to have that collected, a clever way to avoid showing the real increase in council tax. Now don't get me wrong, Barnet had no option but to increase council tax because previously they had frozen council tax and in 2014 actually cut council tax by 1% just before the 2014 election. What irks me is the way council taxes went up by 3.99% and 4.99% in the last two years so that, in an election year, the increase can be limited to 1% while saying it is frozen.

Bin Collection is also a matter the local Conservatives are keen to focus on. They promised they would keep weekly bin collections in 2018 only to withdraw the brown bin food waste collection weeks after the election and two years later introduced the £70 green bin charge. Barnet is the only London borough not to have a dedicated food waste collection. Instead of sending the waste for anaerobic digestion which is environmentally friendly, generates electricity from the gas produced and provides a valuable fertiliser as a by-product, we send it to the Edmonton to be burned in the incinerator. Interestingly, there was a business case developed in 2018 by council officers to move to fortnightly general waste collections which, with a retained weekly food waste  and recycling collection, could not only have saved more than £900,000 a year, but would have helped to push up recycling rates by forcing people to separate out their waste more effectively. Political ideology won the day at the cost to Barnet residents and the environment.

Transparency is another thing which has deteriorated over the last four years. In 2019 Barnet Conservatives introduced new rules which stopped Barnet residents from addressing committees in person and dramatically limited the number of questions that could be asked. It was claimed that this would save £42,000 a year of officer time answering questions posed by residents at committee meetings. In reality it was simply to stop residents asking serious questions about the way the council was being run. There was always a time limit of 30 minutes in any committee meeting for residents' questions and speeches, speeches were limited to 3 minutes and questions were taken turn and turn about so no one person could take up all of the time with their questions. Occasionally, not all of the questions were addressed in the 30 minute slot, but at least there was a written record of the council's response. Now, you are not allowed to address the committee in person or be questioned by committee members, you get one question per agenda item and no more than two people can ask a question about each agenda item. When you are dealing with the annual budget, one question simply isn't enough. For example, at the Policy & Resources Committee in February this year, the papers for the budget agenda item comprised 386 pages including, changes to charges levied on residents, debt management policy, capital strategy, risk register, housing revenue account, medium term financial strategy, to name but a few, yet residents are allowed to ask just one question. I suspect that the real reason for gagging residents was not to save an alleged £42,000 from a council budget of  £344 million, but to stop a well informed and curious resident base from asking difficult and inconvenient questions.

We have also seen other changes on transparency such as the removal of senior officer salary data. We used to get a detailed breakdown of how much all officer paid over £55,000 a year were paid. Below is a graph I used to produce showing how much each officer was paid - I limited the range to those officers paid more than an MP and I never published the officers' names even though the data was available.

The data available then changed so this is all that was published.

Not only was the number of posts listed dramatically reduced but all the historical data was removed from the council's website. I suspect this was because there was a level of transparency which allowed residents to see the increases received by some council officers when their posts were regraded or when they received above inflation increases. No data has been published on the Council's website since September 2019.

Performance of the Capita contract has also suffered from a lack of transparency. Historically, a table known as "Benefits Realisation" was provided for the Capita CSG contract which showed how much (or little) the Capita contract had actually saved. When it became clear it wasn't saving anywhere near what we had been originally been told, they stopped publishing it. Data on Capita's performance at answering the phone to Barnet residents also stopped being published until just recently, and after much pestering from me, as it showed how poor the performance actually was. Having changed the targets twice to make them easier to meet, the latest data shows Capita still aren't answering the phone within the target time of 2 minutes and the data set remains incomplete.

Minutes of the Strategic Commission Board (Council Management Team) used to be published. They were not normally that informative although from time to time they included real insight into the way the council operates. In one set one minutes from February 2018 but published after the election, it highlights a practice known as 'telephony service degradation'. I suspect it was linked to an issue I  raised as part of the inspection of accounts which highlighted that if calls to Barnet exceeded a certain threshold, Capita were able to charge extra and in the financial year 2017/18 that amounted to an extra charge of £247,000. As a way to generate savings, the proposal was to introduce  'telephony service degradation' i.e. make the service worse so as to reduce the number of calls being answered and thereby cut the extra charges being made by Capita. Barnet stopped publishing these meeting minutes before the start of the pandemic and have yet to restart their publication.

Development is another contentious issue in Barnet. Conservatives are saying that they are opposed to over development but if you look at the huge amount of development along the A5 that clearly does not apply there. I know some of the people impacted by the Sainsburys development at the Hyde where Barnet pushed through a development of 1,309 flats in blocks up to 28 storeys even though it sits outside the agreed development area and is not in a town centre. All of their views were ignored including the home owners which will be very badly hit by loss of light. We now have a series of developments which will create 2,500 new flats on a 400 metre stretch of the A5 but without the infrastructure to support anywhere between 5,000 and 7,000 new residents.  The massive development at Homebase in Cricklewood was another example where Conservative councillors were saying what an awful scheme it was yet voted for its approval. Yes, we need new homes especially for families, but what we are getting is a mass of small 1 and 2 bed flats which remain out of reach for most of the people who actually need them.

Barnet became addicted to a central government grant, New Homes Bonus, and in 2019 were forecasting an average of £10.8 million per annum. The more homes you built above a threshold, the more New Homes Bonus you received. It was a crude measure to boost housing builds but Barnet saw it as a useful revenue stream and so were incentivised to build more and more homes, typically 1 and 2 bed flats even though the top priority is for three bed homes for families. However, each year since 2019, that has been adjusted down so that next year we are now forecasting only £4.8million compared to an original estimate of £10.9 million. I raised this issue in 2019 of how reliable New Homes Bonus payments would be, but that was dismissed as pessimistic. It is exactly for these reason that residents need to be questioning the council and why gagging residents is so short-sighted.

The most recent example of Barnet's planning committee not listening to local residents is the Hendon Hub, a massive development at The Burroughs in Hendon which will destroy the beautiful, albeit downsized, Hendon library and a scheme which Historic England did not support. Local residents have launched a Judicial Review. You can read more about the Hendon Hub here.

This leads into our Library service and the way it has been decimated over the last five years. We were told that this was all about saving money and that people didn't really need libraries in an age of kindles, but now more than ever, when people are choosing whether to eat or heat, monthly broadband charges look like a nicety, not a necessity. Libraries were great places for people who didn't have internet access to work, study, apply for jobs, search out information and carry out other day to day functions, not just about somewhere to read and borrow books. In New Barnet, when the writing was on the wall for the old East Barnet Library (2017) I asked if it could be relocated in the proposed new leisure centre which would allow it to stay open all the hours the leisure centre was open. It was still too small but at least if it was open 90 hours a week it would allow people to access books, study space and the library computers. The reality is that we have a library located within a leisure centre open 90 hours a week, with a manned reception right next to the library area, yet the library is only open for just 17 hours per week. With the prospect of  thousand of people moving into New Barnet in the assortment of new developments, a tiny room open just 17 hours a week does not seem like a library we should expect. If you live in New Barnet you will get a chance to visit it on polling day as it is the local polling station - however you will not be able to use the Library - voting only.

Care Homes is another area which Barnet outsourced and which has proved to be a disaster. Apthorp Care Home was outsourced to Catalyst and run by another company Fremantle. You can read all the details here but the net result is the care home was run into the ground, the care offered was appalling and rated inadequate by the CQC. There was a massive backlog of repairs which meant living conditions were unacceptable. Fremantle handed back the running of the home to Barnet in 2019 and in 2021 Barnet decided that the backlog of maintenance was so bad that they would close the home. Now this isn't an old home, it was only opened in the early 2000's. I asked about monitoring in the period before the damning CQC report and it was clear that Barnet did not keep a log of all the monitoring visits nor was there a sanctions or penalty regime in place to make the provider improve. They outsourced the care of our elderly family and friends and did not do enough to ensure their care was safe and secure, something which is unforgivable.

Capita contract is the other issue that remains a running sore in Barnet. In 2018, after the election we told about a massive fraud carried out by a member of Capita's staff, stealing over £2 million in 62 separate transactions over a period of 17 months in 2016 and 2017. The fraud went undiscovered and only came to light after the fraudster's bank alerted Barnet Council to the potential problem. Grant Thornton were brought in to see how on earth such a massive fraud could take place and their findings showed fundamental weakness in the Capita systems and, that " there has also been insufficiently close scrutiny and client side management on the part of the Council and the Chief Officers coupled with an over reliance on the limited scope and frequency of work carried out by the Internal Audit service, to highlight issues. This is likely to have contributed to the lack of focus on effective controls". 

This was followed in 2019 by another fraud in the Capita run Pensions admin department, this time  seven different payments for a total of just over £70,000. Yet again Capita systems were found to be wanting. 

Set out below is the current cost of the Capita contract and shows that so far we have paid Capita £586 million, £225 million more than the contracted sum. It is also important to understand that Barnet have already taken back a number of services including Finance and HR which were in the original contracted sum so, in reality, we are paying even more than is shown.

Following the major fraud, the finance function along with HR was brought back in house and Barnet has been discussing what elements will be returned to the council ever since. We still do not have a definitive list of which council services that will be retained by Capita and we won't get a decision until after the election even though this should have been decided more than two years ago. In 2021 the review of Capita services was accompanied by a “Market Insights” report prepared by Grant Thornton in which the Executive Summary opens with the statement:

“Historically procurement has been ideologically driven and highly political”

 It also goes on to say:

“The gap between cost and efficiency for delivery between the public and private sector has been significantly squeezed over the last decade as a result of market pressures. This means that outsourcing is not always the most cost effective option by default”

I think this first statement sums up so much about the way Barnet Council has been run, ideologically driven and highly political. 

So when you are thinking about which way to vote on Thursday, ask yourself if you want another four years of the same or whether you think there is a better way to run Barnet. Whatever way you vote just please make sure you use your vote, as it will be the only way to show your views and to get politicians to listen for the next four years.

Latest Costs of the Capita Contract

 The latest supplier payment figures are out and the Capita figures tell a familiar story with the total paid to date running at around £225 million more than the contracted value.

The contract comes up for renewal in 16 months but Barnet still have not "finalised" their decision on what services will be retained by Capita and what will be brought back in house or given to another provider as in the case of Pensions Admin. When asked for a date when they would clarify which services will go where, we were told a decision would be available "after the election".

Has Brighton Marina Cost Barnet Residents a Fortune?

 As part of the justification for renewing the contract with Capita, a report setting out the achievements of our outsourced planners included a very curious statement. 

I was somewhat surprised that Capita should be boasting about working for Brighton Marina for 2 years when maybe their attention should be focused on Barnet, so I asked a specific question about it.

"The report suggests that a principal officer spending two years on the Brighton Marina is a good thing; many would say it is the opposite. Major developers seem to have their own VIP lane. Has this decision on planning been made purely on a financial basis and have you lost sight of the service quality imperative?"

The response I got from Barnet was brief to say the least:

"The Brighton Marina project was cited as one example of a project that enables planning officers to broaden their range of experience and knowledge and it was carried out at no cost to the council." 

That was on 23 November last year. Skip forward to last week and Barnet was hit with not one, but two appeals on major planning projects for "non determination". This is where the planning authority fails to decide on a planning application within a defined timescale, which for major projects is 13 weeks. One project was Barnet House at Whetstone and the other was the Victoria Quarter in New Barnet. The council will have to defend these appeals to the Planning Inspectorate, which could cost serious money, and if the Inspector finds that Barnet were at fault, we could be liable for the developer's appeal and legal costs as well. 

Maybe if the Capita planning officers spent a bit more time dealing with Barnet's applications and less time trying to earn money in Brighton, we might avoid incurring significant costs having to defend these planning appeals. I also raised some very serious concerns about the way the planning department is run and its failure to comply with Local Government Association guidelines on pre application advice. Barnet's response was suitably robust 

"We strongly believe that the planning service is in compliance with all legal, transparency and probity requirements. However, if you have specific evidence to the contrary, we will of course arrange for it to be examined".

Last week I submitted that evidence to Barnet's Internal Audit department and will await how they investigate this further. 

Barnet's insistence that Capita are doing a great job in planning and that is why they should retain the contract for another 5 years looks to me somewhat misguided and the sooner it is brought back in house the better.

Capita Savings - The Myths Exposed

It's 2022 and this year there are local elections in Barnet. I have eased back on blogs since Covid but now is the time to start communicating again, so let's start with the latest state of play on the Capita contract. I listened to the council meeting last week where Cllr Dan Thomas reiterated the myth that the Capita contract has saved £125 million. To be clear, there is not a single piece of evidence to support that figure and a great deal of evidence to suggest that the contract has not saved anything at all other than the face of those councillors who voted for this overly complex, badly structured contract. The latest figures for the month ending 31st December 2021 indicate that we have now paid Capita £577 million, £225 million more than the contract value. 

Tomorrow the Financial Performance and Contracts Committee meet to discuss the the latest details  on which Capita services will be brought back in house and which will stay with Capita, either for a couple of years while Barnet decide what to do or for a 5 year extension until 2028. It was agreed last week at Full Council that the following services will all be brought back in-house: Procurement; Trading Standards; Environmental Health; Licensing; Regeneration and Highways. This comes as no great surprise as none of these services generate an income for Capita. Procurement used to be a money spinner for Capita, with its gainshare clause, but this was negotiated out of the contract following the £2m fraud and the monumental mess Capita made on the failed Mosaic casework system implementation, which has cost millions to sort out. I had hoped that there would have been more  progress on providing certainty on whether the other services would be retained by Capita since the last meeting in November but it is apparent that this is a very politically sensitive matter so any further decisions have been kicked into the long grass until after the elections in May. I have asked for the financial details of the services being brought back in house to be disclosed but yet again I have been told the public cannot see these figures even though councillors have seen them in the secret "Blue Papers" and formed the basis of the decision they took last week.  We will not see them before the election, as I suspect they will show that bringing this group of services back in house will actually save money on what we are being charged by Capita and that would be far too embarrassing in the run up to the elections.  So much for Cllr Dan Thomas' statements that Capita are saving money when we could have been running them cheaper in house for years.

The entire Capita contract has a stench about it. As I blogged about in May last year, Grant Thornton wrote  in a summary of the outsourcing process in their Market Insights Report "procurement has been ideologically driven and highly political". Not me saying that, but external advisors, Grant Thornton - extract from their report below:

The level of secrecy surrounding this contract remains high. I have had discussions with the chair of the Committee and the senior officer carrying out the report and managed to get the concerns I raised included in the engagement report, albeit they were then largely dismissed. Critically, we are not allowed to know the real operating costs of this contract and what revenue Barnet is missing out on by having Capita in place.

The lucrative elements of the contract remain for Capita. Revs & Bens, where they can charge extra for exceeding volume targets and where gainshare still exists on council tax collection, housing benefit recovery, withdrawing single person discounts etc. Planning, which generates significant fees, stays with Capita where they get to keep a chunk of the profit. Capita are hanging on to IT, even though their IT system, Integra, has been criticised on numerous occasions for failing to provide the information and flexibility we need. I raised the point that Capita provide both the IT system and the advice on which IT system to use. Surprise, surprise, they recommend using their own bespoke system, Integra. Pre-Capita, Barnet spent over £20 million implementing and integrating SAP, a world class ERP (Enterprise Resource Planning) System. Indeed the S151 Officer has asked for a new ERP but the advice provided comes from Capita so we will be stuck with Integra. I flagged this as a massive conflict of interest and suggested that for the council to respond to the rapidly changing demands for technology and systems, they should consider employing their own chief information/technology officer but yet again this was dismissed.

Capita are having the contract extended for Accounts Payable,  yet this service has received more critical reports from internal audit over the last 8 years than any other service with 4 Limited Assurance reports

Customer Services, mainly the telephone answering system, stays with Capita and we are told they are doing a fabulous job. I wonder how many people have tried to get through the automated answering system at Barnet? Until 2018 Barnet used to publish data on call answering and it demonstrated that calls to Council Tax and Revs & Bens were consistently failing to meet the minimum response time targets, with thousands of calls being abandoned as people gave up trying to get through to Barnet. Unfortunately, Barnet's response was simply to stop publishing the figures. 

Capita was a massive, complex contract, implemented without the resources to adequately manage and monitor it.  Even worse, the people who devised the complex systems all cleared off once the contract was signed. Councillors were warned about the consequences of this ill conceived contract back in 2013 yet Barnet pressed on, as Grant Thornton says, for ideological and highly political reasons, a situation that continues to persist. Unless there is full transparency on this process there will be no confidence that this is anything other than a stitch up.

So when candidate comes knocking at your door telling you that the Capita contract is saving a fortune, ask to see the evidence because there isn't any!