Hackney to ‘reclaim’ nearly £12m worth of services from private companies

The Town Hall has laid out a model to “reclaim” services worth close to £12m a year from private firms.

The council announced that over 360 cleaning, maintenance and parking enforcement staff will become council employees by March 2022, along with a rebuke to the government’s outsourcing of contracts during the pandemic.

The move is designed to help rebuild a fairer local economy post-Covid, with assets, land and services to be used for the public good.

Deputy Mayor and finance boss Cllr Rebecca Rennison said: “The whole country has seen over the last year what can happen when contracts are outsourced to the private sector by default – without the right checks and balances to ensure taxpayers are getting a high-quality and cost-effective service they can rely on.

“Residents want to see their council services run by local, committed public servants that understand their community and can respond quickly in a crisis – not unaccountable private companies.

“That’s always been our policy, but, delivering on our 2018 manifesto commitment, we now want to turbocharge insourcing as we rebuild a fairer local economy and recover from coronavirus, spending our money in the borough wherever possible and employing more local people.”

Between January 2020 and March 2022, five services worth £11.6m will have been insourced under the policy, including:

• School caretaking and cleaning services, worth £2.5m, with 116 staff brought back in-house to the council and schools in January 2020
• Gully and winter cleansing service, worth £300,000, brought back in-house in September 2020
• Office cleaning service, worth £1.8m, with 110 staff brought back in-house in January 2021
• Fleet maintenance service, worth £1.4m, with 10 staff due to be brought back in-house in April 2021 and a long-term commitment to bring close to 400 staff back into direct council employment overall
• Parking enforcement, worth £5.6m, with 132 staff due to be brought back in-house in March 2022.

Council documents include a pledge that all insourcing will take place without the loss of focus on the need to “ensure that essential services can be provided within the constraints of the budget pressures which the council expects to continue to face”.

The documents also stress that decisions to bring services in-house would never be made “purely for ideological reasons”, or even if an outsourced service failed or an outside contractor was judged to be performing badly, but considered in terms of value for money, practicality, and the risks and opportunities of doing so.

Plans for such projects are also commited to including extensive consultation with staff and trade unions.

Rennison added: “This delivers on our 2018 manifesto to look at how we step up our commitment to insourcing here in Hackney. We have been clear from the start that we did not want this to be a flippant or quick easy win, and have put in the work over the past couple of years to develop a framework and structure that means we can take forward insourcing in a really committed way here in Hackney.

“For anyone who has ever worked in insourcing, it is not as simple as drag and drop, and that is quite a dangerous attitude to take. It often involves service redesign, relocating services across different parts of the council, and taking quite a different approach to service delivery than we might have done in the past.

“Coronavirus has shown the importance of flexibility and being able to turn services round rapidly. When you deliver them directly yourselves, you are able to do that. It is also fantastic in terms of the offer we are able to make to our staff. Bringing those staff back in on Hackney terms and conditions once they have moved over and the opportunities we are able to offer with that.

“This is not the end of our insourcing work. It just marks the next stage. There is still a huge amount to do. The length and size of some of the contracts we are talking about [means] this is a piece of work that will take years to fully deliver.

“The simplest thing would be to bring in smaller services cutting off vital investment in the local economy. We have to work out how we balance a sustainable procurement strategy  and commitment to the Hackney pound and how we bring in as many services as we can to deliver that high-quality standard of service Hackney residents rightly expect of us.”