BT clinches major outsourcing deal

Local council to outsource IT in 10-year £300m deal.

Liverpool City Council has signed a £300m deal with BT to outsource its entire IT operation to the troubled telco.

The deal, which BT claims is a landmark in partnerships between the public and private sectors, will see the telecoms giant take responsibility for all the council's IT services, in addition to providing support for its call centres, payroll, revenues and benefits departments.

The telco is installing an Oracle-based customer relationship management (CRM) system to help the council cut waiting times for enquiries from Merseyside residents.

Mike Blackburn, head of marketing at BT Local Government, said the strategy is based on different access methodologies.

"Liverpool Direct, the council's call centre division, currently has about 100 staff, which will rise to about 250. Each of those people will have access to the CRM services and up to date information about the customer calling in. The council plans to extend the reach of its service by moving features to digital television," he said.

Blackburn predicted that this would be the start of a trend of outsourcing from public to private sector. "All councils have similar targets, driven by the Government's 2005 target. Some councils will go for it in a large way, others will take a piecemeal approach depending on their existing infrastructure," he explained.

Staff from the council's existing support workforce will be seconded to BT Syncordia Solutions, the ebusiness division of BT Ignite. BT said this is the first such secondment on this scale in Europe.

Council leader Mike Storey said the agreement will slash red tape and improve services, while safeguarding hundreds of networking jobs.

However, Pauline Owens, head of ICT at the council, said that BT has given no guarantees, and that staff are essentially in the same position.

"Our staff will still have the same terms and conditions. We are in the same position with BT as we were with LCC. There are no redundancies scheduled. Under the restructuring proposals, there are vacancies," she said.