LIVERPOOL Direct, the city council’s front-line service, will switch to full council ownership on October 31.
But its chief executive, David McElhinney, will be kept on for almost a year to oversee the "wind up" before he is made redundant.
A report to next Friday’s cabinet meeting says the council will save £30m over the next three years by scrapping the joint venture it currently runs with BT.
In December, 2013, the council and BT mutually agreed to close down the partnership and transfer ownership of LDL to Liverpool City Council.
Negotiations have now been successfully concluded over a six-month period enabling the transfer of ownership of LDL to the city council.
The report to the cabinet says that by March 31, 2015 it is intended, operationally, that Liverpool Direct Limited will cease to function as a wholly owned subsidiary operation.
“It will take some time to ‘wind up’ the company," it says. "This is forecast to be completed by the 30 September 2015. The Chief Executive of LDL (David McElhinney) will remain in post until the company ceases to operate. The costs of the Chief Executive post will be charged to LDL until the point when the post will be disestablished alongside the cessation of operations around March 2015. Further rationalisation of the LDL management team will take place in line with the transition of services to Liverpool City Council.”
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The first step in this process has already occurred with the integration of the Revenue and Benefits Service under a single assistant director post. It is envisaged that other senior management roles will also be disestablished as the transition unfolds.
A small team will continue to operate until the 30 September 2015 to complete the close down of LDL.
Liverpool Direct was established as a joint venture with BT in 2001, but it has been surrounded by controversy, largely over its costs.
As part of the deal, the city council was entitled to a share of income earned from third-party work generated by LDL.
Since then, almost £59m has been earned for third party work, but the council’s cut has amounted to an income of just £1.54m, a slice of just 1.9 percent which is in accordance with the partnership agreement. This windfall income has been invested by the council in a number of projects, including the provision of e-libraries and the Benefits Maximisation Service which helps to ensure that vulnerable people have full access to the welfare benefits that they are entitled to.
Mayor Anderson said “LDL has successfully delivered services and service improvement throughout its life. The relationship with BT has been central to this success.
“We are grateful that BT remains committed to serving residents and businesses in Liverpool but it is timely, given the continued financial climate for LDL, to move in a new direction to become fully integrated into Liverpool City Council.”
