Headlines: March 5th, 2013

The Department for Transport has signed a deal with arvato to take over its shared services centre in Swansea.

Under the deal arvato will provide back office services to the DfT and its executive agencies. This is expected to deliver significant savings to DfT over a seven-year period.

The independent centre will then expand to provide HR, procurement, payroll and finance transactional services to multiple government departments and arms-length bodies. The economies of scale will enable arvato to drive down costs and improve service levels by sharing expertise across customers, adopting common processes and systems, and investing in new tools.

The deal also includes a framework contract under which arvato will be able to maximise the centre’s potential for growth by competing for additional outsourced central government business.

It is planned that a second independent shared service centre will be launched early next year. The three standalone shared service centres of the MoD, HMRC and MoJ will continue to be operated by departments.

Both independent businesses are expected to grow by taking on additional customers from both the public and the private sectors as well as offering new services to existing customers as required.

Minister for the Cabinet Office Francis Maude said: “In the Civil Service Reform Plan we outlined our intention to make sharing services the norm for Whitehall. The creation of an Independent Shared Service Centre takes us one step closer to delivering the faster, smaller and more unified Civil Service we envisaged in our Reform Plan.

Although it’s perfectly obvious that sharing services makes sense, successive governments have been unable to make progress on this for the past decade. The taxpayer should no longer have to foot the bill for duplicative services. Instead departments will be able to focus on providing services rather than managing back office functions.”