Meeting documents

Apologies were received from Hedley Cadd.

Trevor Egleton, Chairman of the Overview & Scrutiny Commissioning Committee, attended the meeting as an invited guest.

There were no declarations of interest.

Martin Phillips, Chairman of the Task & Finish Group, explained to Members that the main purpose of the review is to better understand how the procurement process works at County level and whether the County Council receives value for money through its procurement of services across the County.

Contributors:

• Graham Collins, Commercial Manager, Finance & Commercial Services Team
• Richard Ambrose, Head of Finance and Commercial Services
• Patricia Hook, Senior Procurement Manager, Finance & Commercial Services Team

Context: Graham will provide a 20 minute presentation on procurement followed by a question and answer session. The presentation will cover the following issues:

·         definition of procurement and how it fits into the commissioning cycle;

·         overview of procurement structures and activity at Buckinghamshire County Council;

·         recent changes and progress in implementation of category management;

·         strengths and weaknesses of procurement practices in BCC; and

·         future developments.

Purpose: To enable the effective scrutiny of future witnesses by providing members with an overview of current procurement activity at Buckinghamshire County Council.

Papers: Background papers on procurement are as follows:

·         Procurement service model slide

·         Contract Management Framework

The Chairman introduced Graham Collins, Commercial Manager in the Finance & Commercial Services team.  He then introduced his colleagues, Richard Ambrose, Head of Finance and Commercial Services and Patricia Hook, Senior Procurement Manager.

Graham Collins started by telling Members that he joined the County Council three months ago and he said that the strengths and weaknesses of the procurement process which were identified as part of a recent review are now being addressed through the transformation process but he stressed that it is still early days.

Graham provided Members with a definition of what is meant by procurement which is the "process of acquiring goods, works or services from third parties and in-house providers".  He explained that as part of the procurement process, there is a need to look at whether the goods and services can be provided more effectively in-house rather than through an external supplier.  He went on to provide Members with a definition of commissioning which is "the cyclical process by which public bodies assess the needs of people in an area, determine priorities, design and source appropriate services, and monitor and evaluate their performance."  He said that these are the definitions used by the National Audit Office.

During the discussion, Members asked the following questions and raised the following points.

How do you ensure that you are not silo working?

The service portfolios are set up to align with external suppliers so that working in categories reduces silo working.  Where there is a common need, then there would be just one procurement process and thereby creating economies of scale.  Graham explained that the team has a long way to go before this is achieved but he said that the processes are constantly under review.

A Member expressed concern about the issue of value for money issue. If the decision is to use internal resources, how do the County Council know that they are receiving value for money of they have not tested the market.

[Trevor Egleton joins the meeting]

Graham explained that the procurement team do undertake market testing and the external responses are compared to the existing internal costs.  He said that the County Council itself makes the decision and his role is to ensure that the best option is taken up.  Richard Ambrose then provided Members with an example of some soft market testing which is taking place within Support Services at the moment.  He said that the aim is to be as efficient as possible internally before comparing the service area to the market to ensure cost-effectiveness.

Graham went on to say that the team do benchmark the services against other agencies which informs their decision-making process.

A Member expressed concern that there appeared to be a lot of re-inventing the wheel.

A Member acknowledged that it made sense to have a single contract but expressed concern about sub-contractors and how they are managed in the process.

Graham said that if the risks outweigh the benefits, then the County Council would not proceed.  Quality  ...  view the full minutes text for item 4.

Context: The Overview and Scrutiny Committee agreed the outline scope for the Procurement Review on 19 October, which was circulated to Task and Finish group members on 27 October for comment.

Purpose: For members to agree the scope and witness programme.

Papers: Scoping document

Sara Turnbull took Members through the proposed timetable and speakers for the forthcoming meetings.

• A Member commented that it would be useful to have a presentation from an external supplier to understand more about what they expect from the contractor.

• A Member said that we should not assume that prices will increase on an annual basis.

• A Member felt that a good arrangement with a contractor should be on a gain and pain basis.

• A Member asked whether commercial specialists write the contracts.

• A Member expressed concern about the quality of the sub-contracting and how that could reflect on the County Council.  A Member explained that the standards are set within the contract itself and once the contract has been awarded, it would be the responsibility of the supplier to deliver the service to the specified standard.  If the supplier does not reach the desired standard, then they are in breach of the contract.

• A Member felt that all contracts should be constantly monitored and a better system for contract management needs to be introduced.

• A Member expressed concern about the level of training given to officers in handling contracts and felt that there needs to be a change in culture amongst officers.

• A Member said that it would be useful to receive feedback from existing suppliers and also feedback from an unsuccessful supplier.

• A Member asked whether it would be beneficial to gain the views of those in the voluntary sector to see whether there were any areas of concern as they felt that communication might be a major concern.

[Steve Kennell leaves the meeting at 2.50pm]

• A Member asked whether the contracts are realistic and felt that monitoring contracts was a very important issue.

Purpose: For members to agree the key questions to put to witnesses. 

The following key questions were asked and points raised:

• When is the Contract Management Framework going to be implemented by the service areas?
• Who sits on the Commercial Board and the AOP Board?
• Who scrutinises the contracts before they are awarded?
• Contract Management training was seen as a major issue so what level of expertise exists at officer level.
• How many contractors have we got?
• How much does each invoice cost the County Council – eg. how much does it cost to chase an invoice?  This area would highlight the level of efficiency in the procurement process.
• We should be looking at our savings and costs by comparison to other local authorities.
• What are the key indicators which are used to determine whether a contract is successful or not and what criteria are used?
• Would it be possible to see a copy of one of the County Council’s contracts to see the content?
• How well does the County Council work with the District Councils in terms of sharing information on suppliers?
• Is the County Council making contact with other neighbouring authorities such as Oxfordshire County Council or Hampshire to see whether more economies of scale could be obtained?
• How are complaints dealt with?
• Are Green issues considered when looking at who to award the contract to – for example, carbon footprint.
• To what extent do we use local suppliers and does this achieve value for money?
• Do we treat charities any differently?  If smaller businesses find it hard to be competitive, would there be a way of making it easier for them.
• Contract Management is the most important element in the process and needs to be an integral part of the specification.
• How are the tenders assessed and what criteria are they using to score the tenders?
• Can we see a copy of the pre-qualification questionnaire.

[Lesley Clarke leaves the meeting at 3.15pm]

The next meeting will take place on Tuesday 18 November 2010 in the Judges Lodgings, County Hall.  The meeting will start at 1pm.

The date of the next meeting is Thursday 18 November at 1pm in the Large Dining Room, Judges Lodgings, Aylesbury.