Minutes for Cabinet Procurement Committee meeting, Nov 17 2009, 5.00PM official page

Apologies for absence were received from Mayor Pipe, Councillor Alcock, Mike Robson and Rotimi Ajilore.

There were no declarations of interest

Contact Jackie Barrett 020 8356 3503

3.1  Minutes of the meeting held on 20 October 2009.

AGREED that the minutes of the meeting held on 20 October 2009 were a correct record of the proceedings.

3.2  Matters Arising from the Minutes

Chris Hudson Assistant Director of Procurement and Fleet read out the following information on the Processes across the Organisation to ensure that lessons are learnt and Operation of the Council’s contracts Register

3.2.1  Processes across the Organisation to ensure that lessons are learnt.

Introduction

Staff turnover and the size of our organisation can lead to knowledge being lost.  Our procurement governance and the staffing structures are designed to counter this and help us learn from experience.  The following explains how, lists what commonly goes wrong and considers what else may be done to avoid these pitfalls:

Staffing Structure

Each directorate is supported by an experienced Directorate Procurement Manager (DPM). DPMs work consistently with a set of services, building category expertise. A DPM will also support contract management if there are performance issues and will accrue detailed knowledge of problems.

Governance

All proposed contracts over £25,000 are risk assessed by the DPM using a proven methodology and their experience. The contracting process and the RP2 and RP4 gateway reviews are subsequently considered by the DPM to ensure that lessons learned from similar projects are taken into account. 

All medium and high risk contracts require benefits realisation (RP5) reports. For CPC these are signed off by the appropriate Cabinet Member, ensuring they are aware of issues raised.

What goes wrong?

CPC only sees proposed contracts defined as high risk. By their nature, some identified risks will be realised. However, typically many problems fall under four headings; Lack of Time, Project Complexity, Specification Drift, and Behaviours.

1.  Lack of Time.

Cause:

·  An emergency (rare)

·  External funding deadlines (common)

·  Deadlines arising from project interdependencies.

·  Starting late; there was time, but officers focused on other more pressing issues.

·  Programme planning without reference to the work in-hand; a project is required to fit a timescale that has been set without full reference to the complexity of the project itself. Technical, legal and procurement expertise is engaged late in the day.

Effects:

·  Partial due diligence

·  Failure to fully consult

·  Decisions based on incomplete information

·  Contingencies in respect of both time and money are quickly exhausted; this is often self-aggravating as delays give rise to still more delays.

Mitigation:

·  Projects have adequate and appropriate resources. These may often include people involved in “doing the day-job” who have other priorities to balance. They may need support to do this.

·  Involve project planners and specialist advisors from the start (service, financial, legal, procurement).

·  Plan “buffer zones” between phases. 

2.  Complexity

Cause:

·  Over ambition; trying to do too many things at once.

·  Using untested solutions or solutions untested in the context required.

·  Reliance placed on the market knowing best rather than the specification (however there is always a balance to  ...  view the full minutes text for item 3.

4.1  Committee Work Programme – Forward Procurement Plan Briefing Note with Appendix 1

Contact Juliet Okwuraiwe – 020 8356 3675

4.2  Hackney Procurement Board – Notes of Meeting 13 October 2009

4.1  Committee work programme –Procurement Forward Plan briefing note with Appendix 1.

4.1.1  Noted that the following item was on the Procurement Forward Plan as a red item:

Dalston Library Fit Out

Nicola Baker, Assistant Director Culture, stated that an agreement had been made with the Developers with regard to the cost of the revenue part of the project.  This information was currently with the Mayor and the Chief Executive.  The Procurement Forward Plan had been updated and it was hoped that the Review Point 2 report would be presented to Cabinet Procurement Committee at its February 2010 meeting.

4.2  Hackney Procurement Board notes of the meeting held on 13 October 2009 were noted.

RECEIVED a presentation from Allan Wood Corporate Director Children’s Services on Children’s Social Services and Youth Services. ( A copy of which is available from Democratic Services upon request).

The following question and answer session took place.

1.  How many contracts were giving cause for concern - i.e. categorised as "red"

Allan Wood was only aware of one contract that was currently red.  Issues with this contract had recently been resolved.  This would however be checked and any amendment would be put in the minutes.

2.  How many of the short breaks tenders had come in under or at budget?

The tender bids for the short breaks programme had been received and were currently being evaluated.  Some of the rates had been too high and these had been rejected.  The Review Point 4 report would be presented to Cabinet Procurement Committee in January 2010.

3.  How do officers manage main stream projects where the funding was time limited and had to be spent within a given time period

A cross agency approach was needed for projects that were mainstream funded which meant that on occasions other projects had to slip.  Tender documents needed to be clear to meet expectations.

4.  How were contracts evaluated and savings monitored against other services?

Instant savings were difficult to identify as many of the projects were about changing long term behaviour problems.

5.  Members had been informed at the last meeting that some of the grant funding had to be spent or given back.  What evaluation work was being done to ensure savings?

Although evaluation was important it was very difficult to determine whether the outcome and behaviours had been changed due to the direct result of the interventions and support provided.

6.  Were the staff capacities adequate enough to respond to capital monies received from the Government ensuring that projects were planned thoroughly and that sufficient revenue budgets were available to make the projects successful in the long term, working with partnership agencies?

Officers acknowledged that the preparation work with such projects was very important and felt that lessons around this issue had been learnt from mistakes made in the past.  Appropriate skilled staff and the right staffing structure were in place.  Successful work had been carried out with partnership agencies which would continue to be improved upon.

7.  The Chair was disappointed to note that Contract Service Managers were only recommended to attend The Procurement Driving Licence training as she felt this should be a requirement.

To note the benefits realised by the Streetscene framework agreements. 

Andrew Cunningham Head of Streetscene introduced the report as set out. 

In reply to a question Andrew Cunningham was unable to say at the meeting how many complaints had been received with regard to works under this contract only that generally residents were happy with the works that had been carried out.  It was hoped that better rates would be obtained for the new contract that would commence in 2011.

RESOLVED to

1.  note the content of the report

2.  note the continued satisfactory operation of the contract

3.  note that the construction index related rate increase has been higher than the general inflation uplift.

To agree the recommendation to appoint a contractor to undertake the restoration works at Clissold House and to appoint a contractor to undertake the restoration work at Clissold Park.