Over recent weeks a number of negative media articles have reported CCS issues without response by the City Council. The events of last week require the facts to be stated.

Since the New Board was established last May, progress has been made in turning the financial and management performance of CCS around.

Last August Management gave notice of change to Sick Pay provisions – again enforced change. This resulted in the Trade Unions taking the issue to the West Midlands Provincial Council. The City Council did not deny breaking away from National Pay Conditions but stressed such change was needed because of the serious financial situation facing Building Services. Sick pay was costing £70,000 per month. Sickness absence levels exceeded 11% on average – in parts of the organisation it exceeded 22%. Since its introduction sick levels have fallen to below 5 when adjusted to reflect appropriate exemptions due to long term nature of certain illnesses.

Financial performance has improved. In October and November last year Building Services operated at a profit reflecting the new pay scheme despite the high levels of sickness. Action on the latter had to be taken. Latest projections indicate Building Services will incur a possible deficit of £50k to £190k for the year ended 31 March 1999 – this compares to an original projection of £1.6m. We await the January financial performance figures and will revise the projection accordingly – but these are the figures reported to the Department of Environment and the Regions – DETR.

Despite the projected deficit for Building Services we anticipate that CCS will return a small trading surplus for 1998/99.

Management have revised financial and management systems over the past 18 months yet much more needs to be done. It was as a result of such system reviews that we identified the Plant and Equipment losses subject to the reports last Friday. The total loss has still to be identified, plant and materials are being returned as a result of the amnesty. What must be stressed is that the plant and equipment had been purchased over the previous three years with the cost being borne by the losses of 1996/97 and 1997/98.

We plan to rationalise and reduce plant and equipment holdings of CCS in particular Buildings Services. Store holding has already been reduced by £400k.

New effective Management structures have been introduced but more change will be required particularly if Building Services are to be successful in the forthcoming tenders. Emphasis has been placed on training and competence profiles are being introduced.

Necessary change has taken place but much much more is needed if Building Services and External Services are to operate in an efficient and effective manner that minimises costs and produces quality services.

Reality demands that we achieve a well run organisation with an order book that sustains the workforce. If we can demonstrate this then the Council will need to decide how best to provide services either direct by its own workforce or by seeking a joint venture partnership. Time is fast running out and decisions will be taken by the Council.