Essex £1bn outsourcing champion charged in expenses scandal

Lord Hanningfield, the council leader who championed a multi-billion-pound outsourcing deal with IBM for Essex County Council, has resigned today amidst the MPs expenses scandal.

He is one of four politicians who will face criminal charges over his expenses claims.

Although he denies the charges, Lord Hanningfield is also standing down as shadow transport minister in the House of Lords, and has been suspended from the parliamentary Conservative Party.

Lord Hanningfield has been charged with six cases of false accounting.

He allegedly submitted claims for expenses to which he knew he was not entitled between March 2006 and May 2009. This includes numerous claims for overnight accommodation in London, when records show he drove home and did not stay in the capital.

In a statement, Lord Hanningfield said he would "vigourously" defend himself against the charges.

"I have never claimed more in expenses than I have spent in the course of my duties," he insisted.

In December 2009, Essex County Council signed an eight-year agreement with IBM to transform its operations and services, and slash costs. It is expected to eventually cost between £2.3 billion and £5.4 billion, dependent upon the services procured.

The council has been criticised for the scale of the project. Essex last November suggested it had learnt lessons from previous outsourcing contracts, possibly including an aborted deal with BT, and that flexibility and clear break clauses were built-in to the IBM deal.

Copyright © 2010 IDG Communications, Inc.

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