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Unison in call for contracts to be brought back ‘in house’
Urgent safeguards to protect services to council tenants are vital,
says Labour
UNION chiefs are calling on the council to bring its housing contracts “in house” after the group contracted to run a crucial service went into administration.
Erinaceous Group, which won the £30.8 million contract to run the Housing Options Service in July last year, called in administrators on Monday.
The service, based in Orchardson Street, Lisson Grove, helps thousands of homeless people find temporary accommodation in Westminster.
It offers free advice on homelessness prevention and housing applications and administers the housing register and choice-based lettings scheme. It also provides housing management for CityWest Homes, the council’s arms-length management organisation.
A spokesman for the group said: “The board of Erinaceous announces that it has today [April 14] appointed administrators to the company with immediate effect.
“The Residential Management division, (Residential Management Group Ltd and its subsidiaries) and Property Maintenance division (Erinaceous Property Maintenance Ltd) also remain outside of any insolvency process and continue to trade as normal.”
A spokesman for the Westminster Unison trade union said: “We are calling for the council to bring the contracts back in house. I doubt they will because they are against public services on an ideological basis. They see the private sector as being able to provide services that the public sector cannot.”
When Erinaceous Group was awarded the contract in July 2007 Unison expressed fears that the company was in trouble. Three months later, share prices tumbled – falling by 95 per cent in October 2007. Banks stepped in to form Residential Management Group Ltd which now runs the service.
The council insists the service will not be affected, but this week Labour leader Councillor Paul Dimoldenberg said: “The long-term future of this company is of real concern to local residents.
“We are not confident that services are safe in the current situation. It is vital that these key local public services to council tenants are safeguarded as a matter of urgency.”
A council spokesman said: “We have been assured by the company that the decision to take other parts of Erinaceous into administration will have no impact on the trading of any part of the residential businesses.
“We will continue to monitor the situation closely.” |
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