Outsourcing giant Capita has signed a £170m deal to carry out services for Sheffield City Council for another six years.
The authority has renegotiated a partnership, due to end in 2016, until 2022.
Capita, which has a giant office on the Parkway, carries out council services including HR and payroll, council tax and business rates collection and ICT provision.
The firm says it will also work on projects designed to raise revenue and save money.
And, in partnership with the council, it has already identified ‘the potential to generate significant additional savings for the council over the life of the extended contract’.
Capita chief executive Andy Parker said: “Capita will work with the council to help it shape services to meet the future needs of citizens in Sheffield and we are committed to making a positive difference for the local community.”
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Sheffield City Council must make cuts of £63m in the next financial year.
Eugene Walker, executive director of resources at Sheffield City Council, said: “It is important for the council to reduce back office costs as much as possible to protect the services that Sheffield residents depend upon.
“We have already reduced spending on IT and accommodation costs by £35m. The re-negotiated Capita contract is a continuation of this work.
“The cost reductions secured in the renegotiated contract will make an important contribution towards closing the council’s budget gap.
“This is hugely important at a time when the council is having to make cuts of £63m.”
Under the re-negotiated contract, staff working directly with customers on council tax and benefits payments will be transferred back to Sheffield City Council from 2016.