Bournemouth Council staff watch as jobs go over to Mouchel (From Bournemouth Echo)

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Bournemouth Council staff watch as jobs go over to Mouchel

10:00am Saturday 7th January 2012 in News Photograph of the Author By Melanie Vass

The town hall

CONCERNED town hall staff packed out a council meeting to witness their jobs being transferred to troubled outsourcing company Mouchel.

Dozens of staff from the finance, organisational development and human resources departments will now become Mouchel employees from February 1.

The move is expected to save the council £7.5 million over nine years but is highly controversial because of Mouchel’s perilous financial position and rock bottom share price.

Dave Higgins, the staff’s union representative, was applauded by staff after he urged councillors to take the advice of an independent risk assessment and “adopt a cautious, wait and see approach” to the transfer of any more services.

These concerns were echoed by opposition councillors. Labour leader Cllr Ben Grower warned: “It has to be in the interests of Bournemouth to proceed with this, not in the interests of Mouchel. We are not in the business of bailing out Mouchel.”

And Independent Cllr Anne Rey asked deputy leader Cllr John Beesley: “If you were just embarking on outsourcing now, would you honestly look at this company given its current circumstances?”

But, following three hours of discussion, the town’s Conser-vative cabinet voted unanimously to proceed with the transfer.

She also warned that abandoning or stalling the transfer would have serious repercussions and it would fall on the council to make the required savings.

Mouchel reported an overall loss of £65m in the year to July 2011 but has negotiated some leeway with its banks and is expected to remain solvent this year.

The prospect of a takeover is highly likely but councillors were told the original contract dealt with this scenario.

Any buyer must honour the deal with Bournemouth coun-cil, or alternatively the council could opt to bring the services back in house at an estimated cost of around £135,000.

Deputy leader Cllr John Beesley said there were no issues with the way Mouchel was currently delivering in Bournemouth and said the company’s new management team had the approval of the company’s banks, He added that Mouchel was paid retrospectively for delivering services and had already created 66 jobs and invested £5m in town.

Comments(36)

BBC Escapee says...
10:31am Sat 7 Jan 12

How many reports advising caution were needed before somebody stopped and thought? If local government contracts are so profitable why are Mouchel racking up 65 million pound losses? Unless the local government contracts are a way of subsidising other parts of the business. Rochdale Council have just taken their outsourced services back in-house from Mouchel ending a fifteen year agreement 10 years early. The most telling comment from the leader of Rochdale Council was that they discovered that the council had been charged £2000 by Mouchel for laptops that they could have purchased themselves for around £600. Ok that’s just good business – but in these circumstances who ended up paying for this lovely profit? A good procurement officer working for an organisation with the buying power of a large council can negotiate pretty good deals if they are acting just for the benefit of their council and tax paying local residents. How can a private company in business to make a profit run the same services for less money than the council without something having to give. It does not seem right that such core services to a council can be outsourced to private companies. I'm all for value for money but you have got to ask if a private company think they can run these services and make a profit why can't the councils' own departments look at being more cost effective as all they need to do is cover their running costs. Previous experience has shown that often after the costs of Council employed contract supervision officers and all the extras generally added on along the way by the contractor to make it worthwhile, no massive savings come to fruition. Anybody remember when Bournemouth Councils’ Refuse Collection and Street Sweeping were originally put out to tender some fifteen to twenty years ago! If outsourcing works so well and private companies are so cost effective why don’t we go the whole hog and do away with Borough Councils and just have a private company with a board of directors running all of our towns and then by natural progression.........

..........one running the country as well! (We could all be shareholders in this new "Big Society" company) Perhaps, the new Bournemouth signs have already been made. Only a little change though to "BOURNEMOUCHEL".

How many reports advising caution were needed before somebody stopped and thought? If local government contracts are so profitable why are Mouchel racking up 65 million pound losses? Unless the local government contracts are a way of subsidising other parts of the business. Rochdale Council have just taken their outsourced services back in-house from Mouchel ending a fifteen year agreement 10 years early. The most telling comment from the leader of Rochdale Council was that they discovered that the council had been charged £2000 by Mouchel for laptops that they could have purchased themselves for around £600. Ok that’s just good business – but in these circumstances who ended up paying for this lovely profit? A good procurement officer working for an organisation with the buying power of a large council can negotiate pretty good deals if they are acting just for the benefit of their council and tax paying local residents. How can a private company in business to make a profit run the same services for less money than the council without something having to give. It does not seem right that such core services to a council can be outsourced to private companies. I'm all for value for money but you have got to ask if a private company think they can run these services and make a profit why can't the councils' own departments look at being more cost effective as all they need to do is cover their running costs. Previous experience has shown that often after the costs of Council employed contract supervision officers and all the extras generally added on along the way by the contractor to make it worthwhile, no massive savings come to fruition. Anybody remember when Bournemouth Councils’ Refuse Collection and Street Sweeping were originally put out to tender some fifteen to twenty years ago! If outsourcing works so well and private companies are so cost effective why don’t we go the whole hog and do away with Borough Councils and just have a private company with a board of directors running all of our towns and then by natural progression......... ..........one running the country as well! (We could all be shareholders in this new "Big Society" company) Perhaps, the new Bournemouth signs have already been made. Only a little change though to "BOURNEMOUCHEL". BBC Escapee