City to outsource IT in £150m services overhaul

Southampton City Council is looking to spend up to £150m on an outsourcing deal that will overhaul its customer and corporate services

The council says it wants a strategic partner - either a single vendor or a consortium - to build and operate the new customer service centre (CSC) and the supporting IT infrastructure, as well as managing the council's corporate support services, including IT, property and some HR.

Five contact centres and a one-stop shop currently handle 20 per cent of the city's four million customer calls each year and the council said it is aiming to "considerably increase" this percentage through the improved processing of transactions at the new CSC.

The city council also believes outsourcing some of its corporate support services will give better value for money than continuing to do it in-house, according to the tender notice.

"The council's future business model requires improved corporate support services, with improved capacity and skills that will be adaptable to future possible service configurations, meaning they are sustainable over the longer term, and that deliver an improved service with better value than currently being achieved internally by the council," it said.

Initially that will include IT, property services and some elements of HR although the council said future phases of the deal may include outsourcing more corporate support services.

The contract value is estimated to be worth £10m to £15m a year for an initial 10 years with a possible five-year extension. Bidders are expected to be invited to tender in October this year.

In a separate announcement today, Southampton City Council said it had extended a Unisys contract to manage the city's revenues and benefits processes for another three years. Unisys claims the deal is already saving the council £500,000 year-on-year.