PUBLIC services and thousands of jobs are being “hived off on the cheap”, it has been claimed, as Scotland’s largest council moves to becomes the latest authority to privatise all of its computer systems.

Amid an unprecedented squeeze on council finances, Glasgow has joined Edinburgh and Scottish Borders in announcing proposals to hand over all its IT services to the same Canadian multi-national firm - CGI Group - with other councils expected to follow suit.

The move has triggered claims that council IT will become the first public service in Scotland to be entirely privatised.

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The new deal with CGI - to provide all IT services to schools, social workers, benefits provision and payroll - will run into hundreds of millions of pounds, with the seven-year arrangement with Edinburgh worth almost £190million.

If approved, the Glasgow deal will launch in 2018.

Union leaders said it represented a growing creep towards all IT services being privatised.

Brian Smith, branch secretary of Unison City of Glasgow, said: “Where Glasgow and Edinburgh lead on these things others are certain to follow, especially given how this has been set up."

"Privatisation looks like the general direction of travel for local government.

“With IT we’re also talking about a key element in children’s education and the care of the vulnerable. Not just back office stuff. Current provision is poor so how will it be better when done cheaper?”

Echoing his concerns, GMB Scotland organiser Benny Rankin said: “The big worry is that this could be the tip of the iceberg in terms of a privatisation agenda across Glasgow city council over the coming years, with jobs, terms and conditions under pressure like never before.

“Our members are anxious that their service and livelihoods are about to be hived-off on the cheap by the council and they are now seeking urgent clarification and consultation from senior management.”

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The move comes as Labour-run Glasgow - which over the next two years must plug a £130 million black hole in its finances - has announced it is to scrap Access, the firm it jointly runs with services giant Serco.

This follows a tumultuous decade in which the firm incurred massive fines for missing laptops, losing personal data and a network crash which crippled the council for weeks.

However Access staff have already told union leaders they plan to strike over the move, while there have already been grumblings in the Borders over the transfer to CGI Group with workers complaining of significant detrimental changes to terms and conditions.

The city council has said the final decision over the IT system will be made by politicians in the weeks ahead amid plans to have the contract signed off by March 2017.

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It also said it would make significant cash savings by recruiting CGI Group as Edinburgh’s contract allows other local authorities to come on board without the need for procurement.

In its staff briefing, the council said its CGI project had “been developed by City of Edinburgh Council and is open to a number of Scottish public sector organisations” adding that the council “could therefore avoid having to pay a substantial amount of money in procurement costs”.

It added: “We recognise this is a difficult and unsettling time for the workforce and it is our intention to tell staff what we know, when we know it.”

Based in Montreal and with a staff of 65,000 and profit last year of almost $1billion, CGI beat multi-national competitors Atos and Capita for the Edinburgh contract, which the council said would deliver £45m of savings over seven years, as it looks to cut costs by £107m over the next five years.

It has been reported that over 1000 jobs are being lost in the capital as part of its overall “transformation programme”.

A council spokesman said: “At present IT support services are being provided to the council through ACCESS, a joint venture company owned by the council and the multinational companySerco. That contract comes to an end early in 2018. As a result the council has considered options for contract provision when the ACCESS contract ends. Nobody that the council currently employs through the standing ACCESS contract will lose their jobs if the council decides on a new provider.”