Burnley Council has announced plans to outsource £34m services in a bid to cut spending.
It says the move will save 19% of the cost over the life of the contract, amounting to about £8m.
Customer services, information technology services, revenues, benefits and debt management, payroll and human resources systems are among the council functions to be transferred to business process services company Liberata from next January.
Asset and facility management, environmental health and licensing will also be transferred.
The plan will include £4.9m inward investment in information technology, a service hub, innovation in the way services are delivered and support for community projects.
It will also mean more than 100 new jobs being created in Burnley town centre over the first five years of the contract.
The council says it has faced £8m government cuts since 2010, more than 50% of its core funding, with staffing reduced by a third. It now needs to save at least £2m or 14% of its budget over the next two years.
Council leader Mark Townsend said: 'We are delighted to be awarding this contract to Liberata, as they bring opportunities for growth into the borough at a time of government austerity measures.
'We are taking this step to respond positively to the challenges that we face. Burnley Council is acting in line with its responsibility to provide the best possible services to residents, in spite of major reductions to our funding.'
