BOURNEMOUTH council is to expand its controversial outsourcing deal with Mouchel – just days after the company’s CEO resigned amidst fresh problems.

Yesterday, cabinet members gave the green light to transferring human resources and finance to Mouchel, adding to the four departments that the company already runs.

It comes just five days after the Daily Echo reported that Mouchel’s CEO had resigned after it issued a profit warning over a £4million accounting error and its share price had dropped to just 15p.

The company has been subject to several takeover bids this year.

The council says the move will save an extra £2.23m over nine years, but Bournemouth UNISON has called the move “horrendous”.

Branch secretary Dave Higgins condemned the decision “at a time when they don’t know the full extent of Mouchel’s financial wellbeing”.

“The fact that the company is subject to takeovers or likely to go bust is a very relevant factor that needs to be taken into account and they’ve not taken it into account.”

The council said it had asked for “additional risk assessment looking at Mouchel’s full year accounts” as part of the new deal.

Cllr John Beesley, cabinet member for resources, said: “A long journey has brought us to the position we are now – a journey that has involved formal scrutiny, extensive financial appraisal and robust negotiation with Mouchel to ensure the best outcome for the council and our residents.

“In light of recent announcements from Mouchel and the company’s expected financial reporting, cabinet has authorised the chief executive to prepare an assessment of any risk variations arising from Mouchel’s full year accounts or other information, prior to signing the contract with Mouchel.”

The council said the transfer would move risk to Mouchel, build in savings and improvements into the contract, generate new jobs through offering services to other partners and offer the chance for the council to maintain control over financial strategy.

The two departments’ staff, 100 in total, will transfer on December 1.

Comments on this story are closed. Please email your views to newsdesk@bournemouthecho.co.uk