Barnet Council has officially signed off almost £450million worth of public services to Capita in two landmark deals.
Capita will take over the authority’s back office functions and customer services in two contracts worth £320million and £126million respectively.
But more than 500 council staff face being moved to Capita offices across the country and face losing their jobs under a gradual redundancy plan.
The authority finalised the deals in November and May but was forced to delay their implementation following a legal challenge by campaigners.
The contracts form a major part of the council’s controversial One Barnet scheme, under which more than £700million worth of services will be sold off to the private sector.
In finalising the latest agreements, the council has become the first in the country to outsource its services on such a scale as a way of combating cuts from government.
Council leader Richard Cornelius says the contracts will save in the region of £165million over the next decade, arguing the authority has no choice if it is to meet budget cuts of £56million before 2015.
Opponents say the authority is “gambling” with taxpayers’ money and attempted to block the contracts with a judicial review in March, which was dismissed because it was brought out of time.
An appeal against the initial High Court ruling failed last week, freeing up the authority to sign off the agreements with the business processes firm.
Under the back office functions contract, a total of 514 positions will be put under the control of Capita, which plans to move almost 200 roles to some of its specialist centres across the country – some as far away as Carlisle and Sheffield.
A total of 175 people will be made redundant under the contract by 2023.
Cllr Cornelius said: “I am delighted that we are finally able to get on with delivering these savings to the Barnet taxpayer.
“Residents’ expectations for council services are growing, even as we have to deal with tighter budgets.
“Our strategic contracts with Capita aren’t about giving the same for less. They are based around improving and developing the services we have on offer over the next ten years.”