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Stafford school support sell-off plans are 'not risk-free'

By Staf Newsletter  |  Posted: November 09, 2012

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THE man behind controversial £1.4 billion plans to sell off Staffordshire’s education support services has admitted it is a risk.

Cabinet member for education Councillor Ian Parry said commercial organisations weren’t risk-free but said he was confident a joint venture between Staffordshire County Council and a private sector partner would be successful.

He gave a “gold-plated guarantee” that pay and pensions for the 5,000 education workers would transfer with them unchanged.

But it’s likely new employees taken on by the company will be on lower pay.

The council will be a partner in a newlycreated company and will hold a stake of between 26 and 49 per cent.

Two council officers will be on the board of directors which will have between five and seven members.

The contract is worth £70 million a year and could last up to 20 years.

“This isn’t a risk-free option but the do nothing option carries far greater risk,” said Councillor Perry.

“Worst case scenario is our trading business with schools declines to the extent that parts of it become unsustainable as other competitors come into the market and we are unable to compete effectively.

You rarely remove all risk.

“Doing it this way we have ensured the risk is reduced because you have greater muscle in the market place.

“Councils tend to deliver things the same way year in, year out. Commercial organisations read the market and deliver what customers want.

“Commercial organisations are not risk-free. They are exposed to all the business economics of a competitive market, .

This business is premised on growth and on sustained growth.” Unison’s Staffordshire branch has started a petition agains the move, saying it would reduce council staff numbers by 40 to 50 per cent.

Branch secretary Steve Elsey said: “There are more and more concerns. We genuinely believe these services are better in the public sector because of accountability.

If something goes wrong you can go and see your councillor, you are not dealing with a multi-national corporation.” Stafford MP Jeremy Lefroy has written to Councillor Parry citing concerns.

“In principle I think it’s a very good idea. It could be extremely successful and good for the county but there are a number of questions I wanted to see answered.

“My constituents approached me about them and I think it’s important to get those details.” Stafford Labour Party member Diane Smith said: “The bidding process for this is raising a number of questions which make me feel deeply uneasy.

“This is a massive deal which if it goes through, may lock the council into a 10- year contract in April, and transfer 5,000 jobs to the private sector. April is important.

This is the council’s last chance to get this passed before the county council elections.”

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  • paul.middleton  |  November 09 2012, 6:11PM

    So we have two short-listed for this sell off: Carillion, who have employed the former lead on this project. Conflict of interest? Capita, also have a contingent of Staff within Staffordshire assisting with procurement. Another conflict of interest? Both should be barred on this basis?