London University has drawn up an ambitious outsourcing program in which a swath of services from managing its estates to marketing and finance will be carried out by a private firm. The London Metropolitan University has more than 16,000 undergraduate student that produced a tendering document under which all services except teaching and the vice-chancellor’s office will be outsourced. According to the Exaro News website the contract is valued at £74m over five years.
Three companies Wipro, BT Global Services and Capita are on the university’s current shortlist. The spokesman for London Met stated that it will pay a fee to any company brought in to manage service which will have zero ownership of the university. If London Met decides to set up a subsidiary company, it will be 100% owned by the university. The staff would be working for this wholly-owned subsidiary of London Met.
Malcolm Gillies has argued that the outsourcing model could be used to share services with other universities, Malcolm Gillieos is the vice chancellor of the university. He wrote an article for Times Higher Education about working with external operators, LOndon Met wants to ho further to realize a model of new-era shared services that other institutions may want to adopt or join. He also said that the contract to run services will be awarded in the autumn.
The university spokesman stated that they hope to develop a pioneering approach to improving services by investing in our people, reducing cost and putting the university on a sustainable financial path. They believe that there are opportunities to share services between higher education institutions.
The chancellor, George Osborne broadcast that a VAT exemption for services shared between organizations that are already exemption for services shared between organizations that are already exempt from tax including universities and charities. The Chief Executive of Universities UK, Nicole Dandridge stated that at the time universities have wanted to develop more cost-effective operating models and more creative collaborations with external partners. However, to date the VAT rules have acted to block. They hope today’s announcement will address the issue.
REFERENCE:
http://www.guardian.co.uk/education/2012/aug/14/london-metropolitan-university-outsourcing-plan
http://www.onenewspage.co.uk/n/UK/74rdtdd7n/London-Metropolitan-University-to-outsource-most-services-to.htm
http://www.pactumcontractmanagement.com/London-Metropolitan-University-to-outsource-most-services-to-private-firm—The-Guardian/B240.htm
http://www.goodschoolsguide.co.uk/latest-news-and-data/education-news/14317/london-metropolitan-university-to-outsource-most-services-to-private-firm
