Report of the Procurement Manager

A copy of a report on procurement efficiencies and the draft contract procedure rules are attached as background papers.

The Procurement Manager will attend the meeting to give a presentation and take questions.

The Corporate Procurement Manager introduced the report and provided an overview of his role at Watford Borough Council and of his background. 

He gave a presentation to members on ‘Procurement and Contacts’ covering the following areas:

·        An overview of approach to procurement.

·        Governance ‘Contract Procedure Rules’.

·        Procurement process one – the specification stage.

·        Procurement process two – the tender procedure.

·        Relevant statistics.

·        Procurement performance indicators.

·        Savings made in 2015/16.

·        Social value in relation to procurement.

The Panel held discussions on the various subject areas during the presentation and the Corporate Procurement Manager responded to member’s questions.

In relation to the specification of contracts, the Chair discussed the Watford Borough Council information technology (IT) changes and the related Transfer of Undertaking (Protection of Employment) Regulations (TUPE).  He inquired how well officers developed specifications.  The Corporate Procurement Manager explained that this could be variable; and his role was to support, advise, guide and challenge - and he was keen that specifications were flexible enough to accommodate service changes. 

He discussed the renewal of the new leisure contract and how a lead in time to 2018 would assist in the contract development process.  The Partnerships and Performance Section Head confirmed that TUPE applied to a number of Capita staff who had now been transferred to the Council.  

In response to a question about quality assuring specifications, the Corporate Procurement Manager explained that he looked through all of the information but would not necessarily have the background knowledge to comment on all technical aspects (depending on the service area) but he would challenge where necessary.  However, there was significant expertise in the authority by those drawing up the specifications; and consultants would be employed, where appropriate, bringing specialist knowledge.  He outlined which contracts would go to Cabinet for approval.

Members discussed the importance of specifications in the contract development process and how the TUPE procedure had been managed; with the Corporate Procurement Manager explaining about the successful transfer of staff to Veolia a number of years ago.  The Panel asked who was involved in preparing specifications (such as trade unions), what were the safeguards, how did monitoring take place and how value for money was achieved. 

The Corporate Procurement Manager clarified that TUPE matters involved Human Resources and the Legal Services team and that appropriate processes were followed.  He explained that a specification became the ‘yardstick’ against which a contractor would be measured.  He gave examples of future specification changes with service providers to demonstrate the importance of the specifications.  He outlined how equipment and hardware were protected under the Veolia and IT contracts to show how the interests of the Council were safeguarded.

Councillor Watkin provided an example of the successful ‘First Care’ contract relating to the recording of sickness by an outside provider.  This was now being utilised by other organisations that were making use of the framework agreement.  The Corporate Procurement Manager explained that positive feedback had been received from staff on the system – which was nurse led and with advice provided first hand.  The procedure was intended to support staff and to drive down levels of sickness; and the Council would receive some income from the contract.  The Panel asked that the Human Resources Manager provide a briefing paper on the benefits of the system. 

In response to further questions from the Panel, the Corporate Procurement Manager:

·        Explained the roles of the companies engaged in the largest contracts with the Council.

·        Confirmed that action was taken to reduce the number of suppliers utilised to reduce costs.  However, balance was needed in this respect as working with local firms was good practice and spreading contracts over a number companies would assist small and medium sized businesses and the local economy.

·        Explained how new companies were encouraged to bid for contacts and how competition was ensured.  He outlined the methodologies used in communicating with businesses and asked that members give his contact details to any emerging companies.

·        Provided information on the payment of the minimum wage and the use of prompt payment requirements in contracts.  However, care had to be taken not to put in elements that could disadvantage providers.  He explained how quality standards could be included (such as in the use of certain materials) and the link to social value.

Members discussed the payment of the living wage for employees in relation to the major contracts with the Council and considered this an important issue.  The Panel requested contract managers to provide information on this matter in relation to the Veolia, Amicus and Indigo contracts.

The Panel raised issues in relation to the new IT contract with Amicus.  The Corporate Procurement Manager explained how the desk support service would now be provided in house.  Councillor Watkin clarified that Amicus did not employ staff on a weekly basis and outlined how the company worked successfully with a range of clients. 

In response to a question about the use of fair trade agreements and whether the use of organic products and re-cycling formed part of contracts; the Corporate Procurement Manager explained that various matters were considered in the awarding of contracts and not simply issues relating to the lowest price.  It was important to ensure the right quality at the right price – the lowest bidder was not always preferred.  He gave an example of the use of re-cycled products across the Council.

Councillor Watkin complimented the Corporate Procurement Manager on his work with Three Rivers District Council that had resulted in the development of joint working arrangements and remuneration to Watford Borough Council.    

The Chair thanked the Corporate Procurement Manager for his contribution to the meeting.

RESOLVED that:

·        the Panel requested the Human Resources Manager provide a briefing paper on the benefits of the First Care sickness reporting system. 

·        the Panel requested that contract managers provide information on whether the living wage was paid to staff employed on the Veolia, Amicus and Indigo contracts.

·        the Panel note the report.