Capita's contract award 'stinks'

8th October 2004 at 01:00
Lib Dems criticise ministers for signing over school strategies to private firm whose chief executive has sponsored an academy. Warwick Mansell reports

A pound;178 million contract to run the primary and key stage 3 strategies has been won by a company whose executive chairman recently agreed to sponsor a new academy, The TES can reveal.

Capita, the country's largest outsourcing firm, has won a five-year contract to support the national strategies. It will take over the schemes from the Centre for British Teachers, a not-for-profit company, next April.

A charity set up by Capita's executive chairman, Rod Aldridge, is to sponsor a new academy in Blackburn, Lancashire, after offering a pound;2m donation earlier this year.

There is no evidence of any link between the donation and the Government's decision. Forty-one companies expressed an interest in the contract, six submitted detailed bids and two - the other was CfBT - were shortlisted.

The Department for Education and Skills said the contract had been awarded on the strength of Capita's bid alone under "fair, open and rigorous tendering arrangements".

A DFES spokesman said: "Contracts are let in compliance with good procurement practice. Similarly, there are rules which regulate the sponsorship of academies. In both cases, the rules have been adhered to."

However, Phil Willis, Liberal Democrat education spokesman, said: "There is a conflict of interest. Here is the head of Capita, which is now a huge provider of education services to the Government, making a donation towards an academy, which is the Government's preferred option for schools of the future. I think the whole thing stinks."

Capita has come under fire for major problems surrounding the launch of the Criminal Records Bureau two years ago, and early difficulties with administration of London's congestion charge.

Capita Strategic Education Services will take over from CfBT, employing a network of regional directors who run training days, develop teaching materials and provide support for teachers.

About 300 staff, including Kevan Collins, head of the primary strategy, and Sue Hackman, head of the KS3 strategy, will transfer from CfBT to Capita with identical terms and conditions.

The existing contract was worth around pound;40m a year to CfBT, which said this equated to around 25 per cent of its overall turnover.

Neil McIntosh, its chief executive, refused to rule out compulsory redundancies within his company as a result of the decision. CfBT currently employs 1,500 staff. Mr McIntosh said: "We are obviously extremely disappointed and, perhaps, surprised, because we think we have done a thoroughly good job, in extremely difficult circumstances."

He denied, however, that the decision had been linked to the Government's failure to hit major targets for primary English and maths. Results in both subjects improved this year.

CfBT has had the contract since 1997. It was shortlisted alongside Capita after 41 companies expressed an interest when the contract was put out to tender last year.

A Capita spokeswoman said that Mr Aldrige was sponsoring the Blackburn academy in a personal capacity. The award of all contracts by the DFES followed "stringent" public-sector procurement processes, she said.

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