£100,000 spent on failed scheme

MORE than £100,000 has been spent on a scheme to partially-privatise street cleaning services in Ipswich - only for it to be rejected by the borough, The Evening Star can reveal today.

When the Conservative/Liberal Democrat administration took control of the borough council two years ago it decided to try to "externalise" the borough's streetcare services.

Although staff would have remained borough employees, the department would have been set up as an independent entity owned by the council - which would have enabled it to tender for contracts in other council areas and in the private sector.

The move was bitterly opposed by Labour councillors who saw it as the first step towards privatising streetcare in the town.

When the administration lost its majority on the council in the run-up to May's elections the proposals were put on hold because it was not possible to get them approved by the council.

They have now been re-examined and have been abandoned after it emerged the cost of setting up the new structure would be uneconomic.

It was revealed that the council had paid £46,000 to management consultants DeLoitte's to examine the proposals and had spent a further £60,000 in officer time and other expenses.

Labour leader David Ellesmere said councillors are furious about the cost of the exercise, although they are pleased that the restructuring has been abandoned.

He is now trying to get the council's executive to refer the decision to its scrutiny committee - which it declined to do- and is now hoping to get the issue debated at the next full meeting of the council.

Council leader Liz Harsant said the scrutiny committee could call in the decision itself but is already facing a heavy workload in the coming weeks.

Council leader Liz Harsant said: "When we looked again at the figures it would have made more economic sense to take the money we would spend on the reorganisation and put it in a building society!

"The returns would not have been worthwhile, largely because of the pension costs that we would have faced. I still think it was a good idea - and some people might feel we should have tried it out. But I think we took the right decision to abandon the plans now."

Labour councillors are delighted that the restructuring has been abandoned - but are furious about the cost of the exercise.

Group leader David Ellesmere said: "This figure of £106,000 makes the county council's travel budget (£25,000) look like small beer. It is appalling that this much money has been wasted for no reason at all.

"We have to have a full investigation into this matter. We need to know if the councillors were badly advised by officers - or if the officers came under undue political pressure to come up with this plan in the first place."