PLANS to outsource council services to third-party providers have sparked concern with a trade union group.

Reading Borough Council launched a consultation earlier this month in a bid to plug a huge gap in its budget, following years of cuts in grants from Westminster.

Members of GMB Union say they are 'horrified' by the suggestion of privatisation, which could see services such as highways, street cleaning and council tax collection handed over to external companies.

The council's funding from the Government will have been cut from nearly £58m by 2020 and the 'huge shortfall' is funds could put vulnerable people at risk if the authority is unable to balance the books.

David McMullen, GMB branch secretary, said: "GMB calls upon the ruling Labour Group, and in particular those who are members of trade unions to reverse this decision and open up an honest dialogue with the recognised trade unions.

"Labour Party councillors were elected to manage public services, and not give lucrative contracts to private companies.

"GMB encourage service users and Reading council tax payers to respond to the council's consultation and call for them to keep services in-house.

"We urge everyone in the town to fill in the consultation and to give their thoughts on exactly how ridiculous this idea is. Putting profit in private company’s coffers and rich CEO’s pockets is never going to be cheaper and better for the people of Reading."

The Medium Term Financial Strategy, which was agreed by the council in February, means savings of £42m must be made over the next three years, against a net budget of £143m.

GMB campaigners say the consultation was launched 'without any prior warning' and believe privatisation would create an 'unstable financial situation' for tax payers.

A council spokesman added: “Our in-house teams continue to work extremely hard to reduce operating costs whilst maintaining good quality services for residents.

"The financial challenge however means we need to be sure we are delivering the best possible quality of service for the best possible value for money, which is why we are now market testing some services.

“While, in some cases, a third party provider may have more capacity to invest in technology and provide more flexibility, keeping services in-house means there are fewer risks and more scope for Council teams to further reduce operating costs themselves and deliver additional revenue where possible.

"The Council does not need to make a profit and services would also have access to the Council’s wider administrative systems. We will consider all these individual aspects as part of the process."

The consultation on the proposed changes runs until August 31.