Capita has been chosen as the preferred partner at West Sussex County Council for a ten year £154m business process services (BPS) contract covering HR and payroll, finance, office services, online service delivery, procurement and pensions administration. The deal will start in late June with service starting in September 2012.
As UKHotViews readers will know, Capita is already the IT infrastructure provider at West Sussex, having won a seven-year deal worth £56m with the council back in October 2010 (see Capita wins at West Sussex CC). So this is a neat expansion of its existing relationship, and validates one of Capita’s key routes to market, cross-selling services between its IT and BPS businesses. It should also add to Capita's organic revenue in FY12.
Interestingly, West Sussex is calling the deal a ‘support services partnership’. Local government increasingly sees all outsourcing activities as 'support services', and seems to make little distinction between the blue and white collar services that deliver them. This is having a profound bearing on the suppliers in the local government BPO market, since it is introducing greater competition between traditionally blue collar support services and white collar BPO competitors. In some cases, such as G4S’ win at Lincolnshire Police, support services players are now coming out on top (see Lincolnshire Police signs £200m deal with G4S). This is a theme we will be exploring in detail in a forthcoming BusinessProcessViews report.