Cuts could see private firms run council services

The Evening Times understands the cash-strapped council is considering what unions have already branded the "semi-privatisation" of street lighting and road repairs.

Officials are looking at the controversial proposals – similar to schemes long pioneered in England – as they brace themselves to lose nearly £50 million in funding over the next two years.

As revealed in yesterday's Evening Times, this latest round of cuts could see the city council shed as many as 1000 jobs by 2015.

And today sources inside the City Chambers insisted they had to be "imaginative" as they face up to some very tough choices.

Council chief executive George Black last night issued a statement to staff on the subject of private partnerships.

He wrote: "Options such as this have not been ruled out."

The council already has one joint venture, and IT support firm, called Access, set up with the private services company Serco.

Sources confirmed, senior officials, are now looking to extending this model, especially those services currently carried out by the Land and Environmental Services department.

This would see council workers transferred to new companies that would be owned jointly by the local authority, and a private partner.

A first such a company, insiders said, could be created to streamline repairs to the city's potholed roads and manage street lighting.

Some insiders suggested bin collections could also be carried out by joint ventures – although this was denied by senior sources.

The prospect of joint ventures was raised as the full scale of Glasgow's cutbacks were revealed.

Papers outlining cuts of £48.8m over 2013-14 and 2014-15 were presented to all the political parties in the council.

Council leader Gordon Matheson today made no direct comment on plans for joint ventures.

He does, however, hint that radical reforms could protect public services from cutbacks he blames firmly on the SNP Government in Holyrood.

The Labour councillor writes: "We are only able to cope with the assault the Scottish Government is making on local government, and Glasgow in particular, by being bold and taking difficult decisions."

Mr Matheson admits the city's finances are grim.

But his take is that they could have been much grimmer – had it not been for other controversial reforms introduced by both his administration and that of his predecessor, Steven Purcell.

Mr Matheson praises Aleos – the arm's-length external organisations – set up by the council to run some services .

These Aleos are wholly owned by the council but, like Access and potential other joint ventures, are operationally independent.

Unions are not impressed. They have always been sceptical about the Aleos – and vowed to fight what they describe as any "privatisation" of services.

Brian Smith, Unison's organiser at Glasgow City Council, said: "What the council is talking about is the semi-privatisation of council services.

"We are not convinced this would save any money.

"Do Labour in Glasgow really believe that money for repairing the roads or collecting bins should be skimmed off to pay the profits of a private company?"

MORE and more councils across the UK are entering such joint ventures.

Some, especially in England, see themselves as "enabling authorities" that simply contract private firms to provide services.

SNP leader in Glasgow, Graeme Hendry, today said he would not rule out partial-privatisations.

Mr Hendry said: "We are prepared to consider joint ventures but we will not agree to short term gain for long term pain."

Nationalist-Liberal Democrat coalition controlled Edinburgh City Council last year dropped plans to privatise bin collection and park maintenance.

Exactly how much cash Glasgow will have in 2013-14 is still to be nailed down. The city will set its budget in February. Labour – and Mr Hendry's SNP – will have to set out what they want to do to maintain services as much as they can as income falls.

Mr Hendry blamed cutbacks on economic mismanagement by successive UK governments rather than the SNP at Holyrood.

Indeed, he praised his party colleagues in the Scottish Government, saying they were giving local government a bigger share of the national budget than ever before.

Mr Hendry, meanwhile, questions whether the cuts need be as deep as officials say.

He said: "Twenty-five per cent of next year's savings are as a result of a failure to deliver on savings budgeted for this year – the administration needs to get to grips with this."

The SNP also questioned the way the council has handled voluntary redundancies.

Mr Hendry said: "Any further voluntary severence needs to be targeted.

"We must end the ridiculous amounts of money being wasted on packages for senior managers where we simply replace them."