Islington Council has handed its in-house reablement care service to a private company in a £1.7 million deal, in what critics have called a break with Labour’s manifesto pledge to keep services in-house.
The council has awarded the contract for the service — short-term specialist care that helps residents regain their independence after a hospital stay — to JC Michael Group. The service is due to transfer to the private operator in February.
It is the first time an in-house council service has been outsourced since Labour took control of Islington Council in 2010. The move sits uneasily with the local Labour Party’s manifesto ahead of the May elections, which promised the administration would “continue an ‘insourcing first’ approach – delivering services in-house, rather than outsourcing”.
The decision has drawn sharp criticism from the union representing council staff. Andrew Berry, the Unison representative for social services who worked in the reablement team for 13 years, said the decision “stinks”. “We are very disappointed by this decision – we feel we’ve been sold out because we were promised by the Labour leadership that services would be brought back in house, but this has gone the other way,” he said.
The council has confirmed no current staff face compulsory redundancy as a result of the transfer. But Mr Berry said several experienced employees had already opted to take voluntary redundancy ahead of the change, warning that “a whole load of new staff” would take over care delivery. He argued privatisation would “see a loss of skills and specialism” and could prove cost-ineffective, “leading to more people bouncing forwards and backwards between hospital, blocking beds”.
Councillor Benali Hamdache, leader of the Islington Green Party group, described the award as a “very clear break” of Labour’s manifesto commitment. “Suddenly, a service is run for private profit rather than public good,” he said, adding that social care workers were among the most exploited workers in the privatised sector. He said he could see “a world where we have more outsourced services because of the national government refusing to fund local councils properly, but it would be a serious breach to do more of this.”
The council has defended the decision. Councillor Ruth Hayes, executive member for health and social care, said the redesign was needed “to ensure we respond effectively to changing community needs”. “Our manifesto set out our in-sourcing first approach to services. We are proud to have a much higher than average in-sourcing programme in Islington. None of that has changed and we are clear that manifesto commitment stands,” she said. She added that the council would “continue to seek opportunities to insource where possible”, but that “there will be occasions on which changing patterns of need mean that we need to work in different ways, and this is one of those.” All staff transferring to the new provider will keep their existing pay, terms and conditions, she said, and the contract “places a strong emphasis on workforce standards and employee wellbeing”.
The decision comes as the council faces severe financial pressure. Staff have been told the authority must find savings of up to £100 million by 2030 — around a quarter of its entire budget. An internal presentation warned: “By 2030, we must save nearly £100million (a quarter of our entire budget). To meet this challenge, we need to prioritise, become smaller and more agile.” Councillor Paul Convery, executive member for finance, has put the remaining budget gap at around £80 million, based on “some quite pessimistic eventualities”.
Islington is not the only London council weighing painful choices as budgets tighten. Kensington and Chelsea has considered a council tax rise of up to 70%, while Camden has pressed ahead with building new council homes.
