Outsourcing Arrangements (Hansard, 11 January 2000)

§ Mr. Gordon Marsden
To ask the Minister for the Cabinet Office what arrangements she has made to ensure(a) the continued input of expertise and (b) the effective monitoring of the implementation of the recommendations of the review of major Government IT projects after the expiry of Anne Steward's secondment to the Government. [104243]
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§ Mr. Ian McCartney
The recommendations to improve the delivery of major Government IT projects being developed by the Cabinet Office review team will include a clear statement of which parts of Government will be responsible for their implementation and monitoring.
The study team is consulting widely to draw on the range of expertise available within the Government, and in the private sector and public sector overseas, as its work progresses. It is also considering mechanisms to ensure that expertise is available to public sector projects in the future.

§ Mr. Gordon Marsden
To ask the Minister for the Cabinet Office what estimate her Department has made of the impact on the ability of Government Departments to assess bids for the outsourcing of their operations of having previously outsourced all or part of their IT operations. [104244]

§ Mr. Ian McCartney
All Departments are required to conduct detailed analysis of the costs and benefits of any outsourcing arrangement, including its impact on all aspects of their operation.
The team set up in the Department's Central IT Unit to review major Government IT projects is examining issues relating to the outsourcing of IT functions. The team will make recommendations to ensure that Government IT projects, including outsourcing deals, perform better in the future when it concludes its work in May 2000.

§ Mr. Gordon Marsden
To ask the Minister for the Cabinet Office (1) if she will issue guidance to Government Departments on monitoring the rate of retention of staff of companies to which work has been outsourced by them in the 12 months following the date of the outsourcing; [104245]
(2) what estimate her Department has made of the impact on the Departments' ability to employ former staff employed by an outside organisation under outsourcing arrangements if that organisation fails to renew its contract with the Department; [104247]
(3) what employment protection applies to former staff of Government Departments who are employed by outside organisations as a result of outsourcing arrangements when the organisation concerned fails to have its contract renewed with the Department; [104246]
(4) what guidance she issues to Government Departments concerning the terms and conditions of employment of staff who as a result of outsourcing are employed by sub-contractors of the organisation to which the relevant operation has been outsourced. [104248]

§ Mr. Stringer
I published, on Friday 7 January 2000, a "Statement of Practice for Staff Transfers in the Public Sector". This follows a public consultation undertaken last year which received widespread support.
The Statement of Practice sets out the Government's policy for ensuring fair and consistent treatment of employees' rights where the public sector is the employer or client in a contracting-out or subsequent retendering situation. The guidance does not require Departments to monitor the rate of retention following a transfer. The approach adopted in the "Statement of Practice", which has the support of unions, public and private sector 136W employers and contractors, is to utilise the Transfer of Undertakings (Protection of Employment)—TUPE—Regulations which give individual employment protection rights to employees affected by the relevant transfer.
Contracting-out and subsequent retendering will all be conducted on the basis that staff will transfer and TUPE should apply, unless there are genuinely exceptional reasons not to do so. Under TUPE, an employee's contract is carried across from the transferring employer along with his or her accrued period of service. Terms and conditions of employment cannot be made less beneficial as part of this process and employees cannot normally be lawfully dismissed where the reason is the transfer. Under this approach, staff of Government Departments should transfer to a contractor with TUPE protections and, where a contract is not renewed (by either the contractor or contracting authority), former staff of Government should transfer with TUPE protections to the new contractor. Similar considerations would also apply to sub-contracting.
Copies of "Statement of Practice for Staff Transfers in the Public Sector" are in the Libraries of the House.