Mouchel, Hertfordshire Highways Design Partner in Administration

It has been announced this afternoon (25th August) that Mouchel Group plc has gone into administration. The assets have been sold by the administrators, KPMG, to a new company, MRBL Ltd, now owned by the lender banks (80%) and management (20%). The banks have had to write off £83 million and the shareholders have lost everything, but at least the 8,000 employees keep their jobs for the moment.

Most of the trading companies will continue to do business, including the one which holds the Highways contract with Hertfordshire County Council, on the same terms as before. It is not expected that the staff who deliver service to the Councty Council will be affected. The Hertfordshire Highways contract now has only five weeks left to run before the new series of contracts starts and Mouchel have given assurances that the service that they will provide to Hertfordshire County Council for the remaining five weeks of their contract will be unaffected.

It must be remarked that the history of largescale outsourcing of services to the public sector has not been an unqualified success. There have been several large collapses and the failure of Mouchel, a middle-sized player in this market, is just another example. Outsourcing often does not generate the savings that the public sector client has been led to expect. With management remote from the council tax payers to whom services are ultimately delivered, outsourcing companies often fail to understand the public service ethos and they struggle to deliver the level and detail of supervisory management and training upon which service quality depends. This can lead to episodes of disasterous service delivery, which are distressing for both the clients and the service users, and from which the companies only recover after expensive emergency measures.

It was Mouchel, as part of Hertfordshire Highways, that was responsible for the flawed Moor End Road Bus Lane. At least 36,000 people were less tham impressed by their standard of work on that occasion. It looks as though our bad experience at their hands was not unique! And the Leader of Hertfordshire County Council, Cllr Robert Gordon has now no time to lose - he needs to recover the cost of the Moor End Road Bus Lane fiasco within the next five weeks.

Make sure you get the county's money back in time please, Robert!