Southampton City Council has signed a 10-year outsourcing deal to improve its IT infrastructure and set up a state-of-the-art contact centre.

The contract with Capita will also support rollout of electronic document and records management and customer relationship management systems across the council. Capita will invest £25m during the first three years of the agreement to update IT systems.

'The city council will benefit from millions of pounds of investment into key customer focused and behind the scenes services,' said Jeremy Moulton, Southampton Council cabinet member for resources.

'We will also save the taxpayer millions of pounds over the term of the contract; money which can be put back into front-line services.'

Human resources and payroll, procurement, property services, and council tax and benefits processing systems will all be managed by Capita. More than 650 Southampton employees will be transferred to the outsourcer.