Barnet's Bailiffs Contract Part 2

Following up on the bailiffs fiasco I blogged about on Friday, I have been ploughing my way through the Capita contract. As a result I sent the following email to Cllr Richard Cornelius, Andrew Travers Barnet CEO, and the two opposition leaders on Sunday. So far I have had only one response and that was from Cllr Jack Cohen who is in no way responsible for this mess. I would have been happy to keep my email private but given that neither Mr Travers nor Mr Cornelius have had the courtesy to respond I have set out my email below for everyone to share:

I am aware that the Council has received a solicitor’s letter alleging a breach of contract with the Council’s bailiffs. These bailiffs were appointed through a framework agreement via the Eastern Shires Procurement Organisation and, according to the DPR, the contract was due to run until December. Following a request to novate the contract, it appears that Capita have summarily terminated the contract and appointed their own bailiffs. What particularly concerns me is that Capita have appointed Equita, a wholly owned subsidiary of Capita without any formal tendering procedure, DPR or any other open or transparent notification.

Having reviewed the CSG contract documentation which you published on Thursday, it appears you were complicit in this appointment as set out the Payment  Mechanism Appendix 2 Pricing Assumptions (5) where it states:

“That the Service Provider can deploy its own Bailiff Service as the exclusive provider of Bailiff services for Revenue and Benefits in order to facilitate more effective collection strategies.”

Frankly I find it shocking that your advisors, and councillors who assured me they had read this contract, could have condoned a matter which appears to fly in the face of contract procedure rules, encourages a breach of contract and raises massive conflict of interest issues. Indeed, it could be suggested that as the decision to appoint Capita’s own bailiffs was made in April 2013 there was never any intention to novate the contract and that all along a breach was anticipated.

I asked repeatedly for someone to independently review the contract but you failed to do so. I asked if Capita would be subject to the same procurement rules and I was reassured they would. I repeatedly asked about conflicts of interest and you reassured me this was covered in the contract. Perhaps you now understand why I was so concerned.

I would be grateful if you could tell me how this unfortunate and potentially expensive situation will be resolved or is this how the Council will be run now under Capita.

Subsequent to this email I have found in another of the contract documents, a further reference to Equita being appointed by Capita as their bailiffs. Indeed, the document is dated March 2013 which predates the contract signed with Newlyns and Phoenix on 16 April 2013. This simply reinforces the impression that there was no intention to fulfil the contract and which I suspect will undermine Barnet's case if/when this goes to court.

This is not going to end well.

Threat of legal action just two weeks into Capita Contract

The Capita contract does not appear to have got off to a good start. I heard earlier in the summer that the bailiffs contract has been torn up even though it was mid term and that Capita had appointed Equita, their own bailiff company.  The original contract was with two companies, Newlyn Collections Services Ltd
and Phoenix Commercial Collections Ltd and you can read the authorisation of that contract here.

Today I have received news that, unsurprisingly, Newlyn and Phoenix are not very happy about the situation and they have issued a lawyers letter to the council employee who gave  notice of the termination, the chief executive of the council and every councillor. It is a four page letter which make some pretty serious points including the threat of injunctive relief if Barnet/Capita pass any further bailiff instructions to Equita - see below:

The lawyers not only allege that the council has breached the contract but they call into question the probity with which the contract has been handed on a plate to Equita. The letter goes on to state:

This is the real issue here. We have Capita who are administering Council Tax collection through the NSCSO contract  (now called Customer and Support Group or CSG) and if people fail to pay they send the demand straight to their own firm of bailiffs, Equita, who will also make money by receiving the instruction. Whereas in the past there may have been some attempt to come to an arrangement with late payers, there is now a massive incentive for Capita to pass all such problems straight to Equita.

Over the last two years I have asked many questions about procurement procedures that Capita will have to assume and about potential conflicts of interest. Ultimately it is our money they are spending therefore they should maintain exactly the some openness and transparency. In this case Capita seem to have fallen at the first hurdle.

Councillors cannot ignore this as it has been sent to every one of them and when  lawyers get involved it gets expensive. Barnet may have published the contract yesterday, albeit with many redactions, but who is actually checking to see if it is being properly administered.