Labour urges delay over Unity troubles

Call to hold off transfer of council services
LABOUR says the transfer of more Oldham Council services to the Unity Partnership should be delayed because of problems affecting the authority’s business partner.

The warning about Mouchel follows news that the company’s financial position has worsened.

Mouchel’s share price fell 15 per cent last week following reports that the company had struggled to get bank backing for a financial repackaging.

That led to the bank calling in its own financial team, Deloitte, to study the company’s books.

Councillor Jim McMahon, Labour leader, said: “First we have had to agree a bailout to stop losses following the failure of Mouchel to bring in the promised new work.

“We then had Oldham’s call centre moved to Rochdale, and have been forced to accept a shared management team with Rochdale to save money.”

In October, Mouchel announced losses of over £14.7 million and has been forced to reduce its staff by 2,000 across the country.

Councillor McMahon said doubt has also been cast over a second phase of Oldham Council services being transferred to Unity.

Unity already provides the Access Oldham contact centre, some finance, highways, property and IT services, and is due to take over the council’s human resources, credit control, and some accounts functions, highway management and more customer services next year.

In November, Mouchel plc closed some of its Liverpool operations to bring its own jobs in human resources, payroll and finance to Oldham in 2011.

But Councillor Mohammed Masud, Cabinet member for customer services, said he is is confident of the long-term future of the partnership.

He added: “I can confirm that the phase 2 transfer of services to Oldham-based Unity Partnership is proceeding to plan to take place in February.

“We continue to be in close contact with Mouchel’s chief executive and finance director.

“The council had already taken all necessary and appropriate steps to reassure ourselves and put in safeguards to ensure we are financially protected.”

A Mouchel spokesman confirmed it was refinancing the company with its banks and said the Deloitte due diligence exercise was standard practice.

He added: “This undertaking in no way affects the group’s capacity to provide services to its many local authority, central government and other public and private-sector clients, including Oldham Council.

“Mouchel continues to demonstrate its commitment to Oldham, most recently with the announcement that we will be bringing 65 new jobs to the borough next year.”