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Council forecasts £100m savings after taking repairs in house
A council in the North East has said it will save up to £100m by bringing repairs of its 14,000 homes in house and scrapping a long-standing contract with Kier Group.
North Tyneside Council initially approved the plans in April. A report that went before its cabinet today stated that the project had “successfully established the correct arrangements to ensure the smooth transition of services between Kier and the authority”.
A total of 400 employees transferred from Kier to the council in April, and the six-month report stated that service quality and efficiency had improved.
An officer’s forecast stated that the council will save £100m over 30 years on repairs by bringing the service back in house.
It noted that savings for 2019/20 are expected to be £6.395m.
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“The circa £1.5m of permanent revenue savings per year will be recognised over the lifetime of the 30-year [Housing Revenue Account] business plan, and this equates to somewhere approaching a total forecast revenue saving of £60m over the 2020-50 [Housing Revenue Account] plan period,” the report said.
“Hence, over the lifetime of the 30-year [Housing Revenue Account business plan], taking into account the one-off savings, forecast revenue savings and forecast capital savings, savings of the best part of £100m should be achievable over the lifetime of the 30-year business plan, which can be re-profiled and re-invested back into the service to meet cabinet and tenant priorities.”
Work delivered between April and October included 16,000 housing repairs, 480 homes being made ready to relet, and 7,500 gas services completed.
The new in-house team also completed 1,288 adaptations to allow home life to be made easier for vulnerable tenants and those on supported independent living.
Phil Scott, head of housing, environment and leisure at North Tyneside Council, said: “By running these services directly, we can exercise more control and improve customer service, deliver quality services at a better price and make resident satisfaction our number one priority.
“Alongside this, we are creating new opportunities for small and medium-sized local businesses to deliver work on the council’s behalf, support our workforce, and make sure that more of our public spending stays within the borough.
“Tenants are already starting to see the benefit and our teams will continue to focus performance levels with our customers as we move into the business-as-usual phase of the project.”
Stoke-on-Trent City Council also decided not to renew a repairs joint venture with Kier in 2018, opting instead to set up its own housing company.
