A five-year deal announced today between Rockdale City Council, in Sydney's southern suburbs, and Fuji Xerox has caught the eye of the Australian Privacy Foundation.

The council inked the $3.5 million deal with Fuji Xerox Global Services to manage and upgrade its existing fleet of digital print and document finishing print services.

The contract will also involve imaging services staff of Fuji Xerox opening some of the Council's incoming mail, scanning the contents and storing a digital hardcopy of the letter on file. All imaging services will be completed on site and will involve scanning an estimated 2000 documents a day.

The information contained in the letter will then be sent to the appropriate business unit via e-mail.

Rockdale City Council confirmed that, as part of the agreement, anything to do with business mail will be opened by imaging services staff, but not any personally addressed mail to councilors, or any correspondence marked private and confidential.

Anna Johnston, chair of the Australian Privacy Foundation, said the council has a responsibility to advise residents, or people writing letters to council that correspondence will go through a private company and be scanned. This will give residents the option to hand deliver mail if they are concerned about confidentiality.

"Like any council or state government agency, Rockdale City Council is regulated by the Privacy and Personal Information Protection Act which requires councils to take steps to protect the security of personal information they let contractors hold," Johnston said.

"I hope the council is fully aware that if staff at Fuji accidentally destroy or delete data, the council will then be liable. Privacy does not prevent outsourcing of these functions, but leaves the liability with the government agency."

As part of the contract, Fuji Xerox Global Services will provide all print and imaging services on site. Two Fuji Xerox staff will provide print centre services including digital print, document finishing and when required, procure print services from third parties as well as DocuCare services to maintain and support multifunction devices.

Dawne Clark, Rockdale City Council business services manager, said the council has already achieved substantial cost savings through imaging services and anticipates significant long-term cost savings from additional services.