Council agrees £2.4m IT contract

Sandwell Council will spend £2.4m extending its IT contract with Oracle.

The software manages the Black Country council’s day-to-day business such as accounting, finance and procurement as well as human resources (HR) and payroll for thousands of staff.

The deal was agreed by the council’s Reform-led cabinet at a meeting on Wednesday (October 14).

A multi-million-pound contract was initially approved under the previous Labour administration in 2019 and extended for a further two years in 2024.

The cabinet report said the switch had “improved budget monitoring, automated approvals, and [made] significant productivity gains for staff.”

“The renewal protects the council’s investment in Oracle Fusion and ensures continued access to systems that are essential to the effective management of financial, workforce and procurement functions,” it said.

However, the stated improvements come after the cost of the IT upgrade had nearly tripled to £14m in 2024 after the much-delayed project was plagued with hold-ups.

Sandwell Council revealed the bill for ‘some’ of its switch to finance and HR system Oracle faced a huge rise from the projected £5.6m cost five years earlier.

The system was supposed to have ‘gone live’ in April that year but was delayed until September.

Most of the work was originally expected to have been finished by 2020 before a long list of delays and hold-ups.

The roll-out had already been split in two with the council’s finance and procurement systems and its HR and payroll systems going live months apart because of several delays.

The mess created by the IT switchover was one of the main reasons the government placed the Black Country authority in special measures in 2022. The switchover has faced several delays since receiving approval from councillors in late 2019.

The ongoing saga with Oracle remained a major concern of auditors Grant Thornton despite the auditors saying it no longer had ‘serious’ concerns over Sandwell Council – a ruling that led to the local authority coming out of special measures and government intervention.

Auditors still raised concerns about rising costs and increasing delays to the council’s multi-million-pound switch to HR and finance software Oracle Fusion and that “significant improvements” still needed to be made in the council’s finance department.

By Christian Barnett | Local Democracy Reporting Service