Wandsworth to cut finance costs by 40% and offer framework to other boroughs
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A new framework being procured by London Borough of Wandsworth which would outsource most of the work of its financial transactions team will be made available to other councils in the capital.
The council today published a tender notice seeking a supplier of accounting services including sales and purchase recording, along with the preparation of tax returns and financial statements.
The proposed 10 year framework also includes financial software services, and could be worth up to £522m if other London councils decided to call-off services, according to the tender document.
Chris Buss, director of finance at the council, told Room151: “I think we could save a good 40% through this contract on what we are paying at the moment. We looked at the costs of providing the services in house but there is no way we can do it as cheaply as going out to the market.
“Our current financial software license runs up to 2016 so we thought we would give the market the option of doing the whole lot.”
Buss said that the council would still employ a chief accountant, but the contract would mean the replacement of 34 finance transactional jobs within the council.
The successful provider will be expected to agree terms enabling the council to recover some of the costs of procurement through a percentage reduction in the annual price to the council for each London borough council calling off the framework, Buss confirmed.
In addition, he said, economies of scale could lead to reduced costs for all authorities making use of it.
Buss said the exact terms of the financial arrangements would not be tied up until the end of the procurement process.
The contract would run for an initial six years, with the option to extend for a further four years.
Wandsworth said the value of business it would provide through the contract would range between £6m and £18m (its current expenditure) over 10 years, depending on the level of efficiencies achieved. Another £504m worth of business could be up for grabs from other authorities.
Buss said: “We have had a word with a few other authorities and quite a few have expressed an interested in joining.”
The closing date for suppliers to submit a bid is 16 February.
Wandsworth is making the move as part of a wider rationalisation of services with parallel processes affecting facilities management, ICT, scanning and indexing and contact centre staff. In all, the council could lose up to 156 staff.
Photo (cropped) by Ken Teegardin
