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From Within - Capita’s tips and tricks from a former employee
I see you are campaigning about transfer of certain services to the private sector. One part of this has already gone through (although you are panning to appeal?) and I see you are about to get another department of the council possibly being transferred to your council’s preferred bidder - Capita Symonds.
As an ex-employee of Capita Symonds, I might have the odd point that you may be able to raise and publicise (but you may already know these things anyway)…
1) Contract terminology used by Capita uses deliberately misleading words as legal terms in order to provide a lesser service.
An example of this would be the word “supervision” relating to how council staff would “supervise” work being done by contractors. (You will probably find that “contract supervision” will be an item on the time sheets of council engineers department staff, for example supervising highway maintenance contractors). But, Capita Symonds deliberately remove all references to “supervision” from the contracts, performance criteria and evidence indicator parts of Service Level Agreements with the council and replace “supervision of contracts” with the term “monitor contractors performance”. This may sound like just a different term for the same thing, but it is most certainly NOT the same. “Supervision” means to tell the contractor not just what you want done, but how you want them to do it. It is very common in local government contracts because the work used to be done by the council’s own Direct Works Department so the council’s engineers dept staff would tell them exactly what they wanted done and how to do it.
To “monitor contractors performance” means you don’t tell the contractor anything about how you want the work done, you just “expect” them to read the contract documents and do the work correctly so you only check that the work has been completed correctly after it has been done. Obviously, this is frequently too late when a road has been resurfaced in the wrong way, wrong materials, wrong standard etc. The contractor will say, “nobody told us we were doing it wrong, so we’re not paying to put it right,” Capita say, “we followed our contractual obligations to the council, so we’re not paying to put it right” - so guess who ends up paying to get the work put right - the Council does - sorry that’s not correct, you and me - the council tax payers pay to put the work right!!! I thought this outsourcing was meant to save us, the council tax payers, money!?
The reason Capita Symonds only “monitor” rather than “supervise” is that it means they tell their Professional Indemnity Insurers that they don’t supervise works so will have no claims for poor supervision or contractors claiming that, “we did it this way because Capita told us to, so it’s Capita’s fault”. This means they pay less Professional Indemnity Insurance, which could amount to significant savings for a company like Capita Symonds.
It is only a personal opinion, but I would say that if a hypothetical company tells the council that it will do exactly the same job as the council does but for less money and yet deliberately, knowingly, sets out to not provide the same service the council provides - I would class that as at least lying, possibly setting out to mislead or at worst deliberately setting out to defraud the council. Would that be a reasonable conclusion for any reasonable person to come to?
2) Capita Symonds have a policy of increasing their turnover and profits by ten percent over a period of time (see their own website for this boast) - this basically means that even though they claim to carry out the same work for less money, they also deduct at least ten percent from the contract value that is their own profit. It is obvious that a private firm needs to, and must, make a profit to survive - but again you have to ask the question, what do they have to do in order to make that profit? There is only some much you can do by merely improving efficiency - so sadly staff have to go or service provision has to suffer to save money so they can make a profit.
3) Internal team budgets. You will find that each team within the council will have to pay part of their budget for “support services” (things like admin, stationery, payment of salaries etc.). So one way that Capita make their money is to increase this overhead to each team immediately they take over. The team I worked in, for example, when working for the council had to pay approx. £11,000 for support services, but when we were transferred to Capita Symonds, they charged £32,000 to our “cost centre”. Capita’s interpretation of this was that our team was now making a loss so we had to bring in extra work to make up that shortfall! Just to show how petty Capita Symonds are though, not only did they up the overhead, but we then had to pay extra to order pens, paper, ink cartridges etc - even further reducing the budget of the team. (Incidentally you will frequently hear a complaint about councils is that overheads are too high - and yet Capita Symonds specifically increase the overheads as a way of making money!!)
4) Another little trick that Capita like to do is to constantly reorganise staff and departments and take team leaders away. This is, of course, carried out to find out who is best at certain tasks and improve efficiency (!) - but the real reason is so that staff who insist on doing things correctly can be moved around and then what Capita think of as unimportant tasks can “fall down the gaps” that appear within all this chaos of staff being moved around and some people now not knowing how things used to done or who is supposed to do a job. A statement made to all senior staff where I worked was that senior staff should seek to make their existing role non-existent by finding a national or regional role for themselves - anyone who didn’t was in serious danger.
5) Ask the council to put a clause in the contract with Capita Symonds that states, “Should staff leave Capita Symonds (Barnet), for any reason, the council will receive an immediate 90 percent saving on the staffing costs associated with the person who leaves” (re-phrase as you see fit). This is because contracts that Capita Symonds write merely state that they will provide the service, not employ “x” number of staff to provide that service. This means that if Capita Symonds believe they can carry out certain work with four staff rather than five that the council currently employ, they will seek to remove a member of that team by any means they see fit and KEEP THE MONEY THEMSELVES even though they have just saved twenty percent on a team by reducing the number from five to four on a particular task. (“by any means they see fit”, could include pushing people to retire who don’t want to/can’t afford to, - making those with less good sickness records leave, - pursuing and isolating people on grounds of competence, just because they don’t like them, - pushing people with a conscience to “voluntarily” leave, - looking for any reason to sack a person for misconduct no matter how good a member of staff they have been previously etc)
I don’t wish to be political or offensive to anyone who holds strong political views, but I am certainly not a socialist by any stretch of the imagination - what I do believe though is that council tax payers and the council should, at the very least, get what they pay for and not be lied to or defrauded out of significant sums of money by a contractor or service provider that deliberately sets outs to mislead the council for financial gain.
The really upsetting part is that it tends to be Capita rather than the Council who draw up the contract, which will then go through the Legal Dept of Chief Execs Dept of the council, who sadly have very little knowledge of the difference in terminology used by companies such as Capita.
As a matter of interest, I would suggest you research contracts that Capita Symonds have lost. One example could be at Sefton Council on Merseyside where Capita had a ten year contract that is being terminated after only five years. The official reason is that Sefton Council now say that this type of outsourcing is no longer fit for purpose in the current economic climate as it is not quick enough to react to changing circumstances and yet your council is falling into the same trap of signing a long term contract where the council has no control over the way work is done, the number of staff employed to do that work, or any savings made by staff numbers reducing. In Sefton, the same promises were made about increasing staff, training, investment etc. Did that happen? Of course it didn’t happen! The only extra staff that Capita brought in were business managers because they wanted to make money out of the deal, no new technical staff brought into the technical services department!! In Sefton, Capita got shut of so many staff without giving Sefton a reduction in costs that it is now cheaper for Sefton to take the contract back from Capita Symonds and make an immediate saving!!!
I apologise for ranting - but I’d just like to offer my support, and wish you the very best in campaigning to get decent services, decent value and local control.
Kind Regards
Paul - a real, genuine concerned council tax payer.
2 Comments
Julian Silverman
Jun 04, 2013
Thanks for this really useful insight into the way it actually works. Firm control over the procurement process and over the drawing up and running of contracts throughout their operation could ensure that we were not all ripped off. That would mean control by citizens through their elected council and accountable loyal town hall staff, with the guidance of experienced people who understand the language and the pitfalls.... But then Capita would never sign up to a contract drawn up honestly in the interests of citizens, would it?
Richard jasper
Nov 11, 2013
Capita, they got rid of at least 15 technical services staff, never replaced them, they moved people around and it was a suck it and see dept, even the engineers now do the techs work if the techs aren't around. I can't believe some of the councils who are keen on them, do they even ask sefton or Carlisle. Proper head workers.