Agenda item

Cabinet Members' Items - Report of the Corporate Finance and Governance Portfolio Holder - A.2 - The Shared Procurement Partnership

To update Cabinet on the successes of the joint working arrangements with Tendring District Council and Essex County Council for the delivery of procurement functions and to seek approval to explore a wider procurement partnership at a strategic level, to maximise existing opportunities through closer partnership working other Councils.

Decision:

RESOLVED that Cabinet –

(a) notes the progress of the existing partnership arrangement with Essex County Council for the delivery of procurement functions under the Service Level Agreement;

(b) agrees that Tendring District Council (TDC) form part of a wider partnership of Councils to explore the Shared Procurement Service for parts of Essex;

(c) authorises the Portfolio Holder for Corporate Finance and Governance, (as the Executive member responsible for procurement) to represent this Council at the Member Advisory Group;

(d) requests the Chief Executive to appoint the appropriate Officer to serve on the Strategic Officer Group;

(e) authorises the contribution of £45,000 from existing vacancies to the shared procurement project for the development of activities as set out in the Portfolio Holder’s report;

(f) authorises the Chief Executive, in consultation with the Portfolio Holder for Corporate Finance and Governance, to agree the Partnership Agreement for the Shared Procurement Service;

(g) requests the Portfolio Holder for Corporate Finance and Governance to review the Shared Procurement Service progress prior to any decision at the expiration of the existing Service Level Agreement with Essex County Council;

(h) instructs Officers to ensure that the Council’s Contract Register and Procurement Project Pipeline was kept up to date to ensure TDC matters could be included within the Shared Service prioritisation; and

(i) welcomes the work identified for a joint approach to Social Value for procurement purposes, for a further report to be presented at a Cabinet meeting later in 2023.

Minutes:

Cabinet considered a report of the Corporate Finance & Governance Portfolio Holder (A.2), which updated it on the successes of the joint working arrangements with Tendring District Council (TDC) and Essex County Council (ECC) for the delivery of procurement functions and which also sought its approval to explore a wider procurement partnership at a strategic level, in order to maximise existing opportunities through closer partnership working with other Councils.

Essex County Council & Tendring District Council - provision of procurement services

Cabinet was reminded that the partnership between TDC and ECC had begun on 1^st October 2021. Since that time the joint team had worked on 53 procurements, of which 24 had been awarded or were awaiting governance approval to award. In addition to the above, the shared procurement resource had provided advice and support to colleagues across TDC on how to source a wide range of goods and services. The joint team had embedded a new robust approach to procurement practice with improved documentation, using the Proactis resourcing tool to ensure the visibility of procurement opportunities and robust adoption of procurement process and evaluation principles. Procurement training had been and continued to be rolled out across the organisation and a new approach to category management had begun to identify key areas of spend where enhanced value for money could be achieved.

Combined, this had helped the Council to improve its approach to how it spent public money and set the foundations for further improvements.

Joint Shared Procurement Partnership:

Cabinet was made aware that ECC and Braintree District Council (BDC) had proposed to create a shared procurement service, which would bring together the existing ECC Shared Procurement team, which currently supported TDC with the Essex Procurement Hub (EPH) in partnership for common benefit to all members. This partnership and new Shared Procurement Service was expected to launch in April 2023 to:

· Undertake procurement activity on behalf of the member districts and boroughs and any new partners who may join.

· Review corporate spend, trends and patterns and initiate value for money opportunities across council services involving collaborative procurement, internally and externally.

· Identify collaborative procurement and contract management opportunities on behalf of all member organisations and deliver these procurements.

· Develop shared documentation and procurement approaches for use by members

· Seek to identify opportunities to deliver revenue from the Shared Procurement Service. In the first instance this will be used to offset the investment by ECC.

Members were informed that the future delivery model of the Shared Procurement Service still needed to be explored and shaped but even at an early stage would deliver the following benefits to Tendring District Council:-

· Resilience - with a larger team across both organisations that was able to meet the fluctuations in demand for the service;

· Expertise - with the EPH knowledge of district spend areas and the recognised expertise of ECC’s procurement team enabling better constructed procurements and greater value for money;

· Collaborative savings – through closer working and shared understanding of forward plans, the partnership would be better able to identify shared procurement and contract management opportunities removing duplication of resource time and increasing the opportunity for economies of scale; and

· Reduction of duplication in the delivery of support services such as policy creation and training, releasing time for staff to focus on value-add procurement activity.

It was reported that TDC had already identified a number of specific activities that needed to be delivered by the Authority, those had been considered against the offer of a wider partnership sharing resources, with that service being able to:

(a) Develop and promote the Procurement Strategy, with the anticipation of a common procurement strategy;

(b) Review the Procurement Procedure Rules;

(c) Ensure the Council’s practices were up to date with legislation, national guidance and best practice;

(d) Commercial awareness in public law environment focusing on procurement opportunities and contract management skills;

(e) Developing and delivering training;

(f) Seek compliance with the regulatory framework and raising matters of probity and non-compliance with Senior Managers, Management Team and Internal Audit, where necessary; and

(g) as part of the review of the Council’s Procurement Strategy and Procedure Rules, the shared service would seek to incorporate Social Value opportunities and contract management principles.

It was anticipated the Shared Service would also create and embed a corporate Contract Management framework setting out overriding principles, which were common across services, providing guidance and processes to contract management resource within the individual services to implement change and achieve improvements identified through reviews.

Cabinet was advised that, with the ongoing vacancy of a senior post at TDC for Corporate Procurement and Contract Management, it was proposed that £45,000 was reinvested to contribute to the shared procurement service for 2023/24, in order to develop and deliver the above activities. Key Performance Indicators would be detailed within a future partnership agreement which would be drafted giving consideration to the above aims and objectives. The objectives would be regularly reviewed and reported to the Strategic Officer Group. The Strategic Officer Group would decide whether the trial had been a success, with individual decisions on whether to continue to participate and if so, in which delivery model, taken by each member authority.

It was important for the Council to give consideration and maximise opportunities for Social Value through the procurement cycle adding value for the area and delivering against the Council’s Corporate Plan. This could be achieved with earlier scoping through specification and evaluation criteria. As with other Essex Councils, it was now considered best practice to adopt a dedicated Social Value Policy for Procurement Purposes, in order to set out how the Council wished to achieve the social, economic and environmental strands through its commissioning.

It was considered that any Social Value Approach being drafted for adoption, should be scoped and shaped in consultation with Members, services across the Council, other local authorities, either as part of the proposed Shared Procurement Service for part of Essex, or through the Anchors organisations together with TDC stakeholders. A joint Essex Social Value Approach was being explored and the results would be presented to Cabinet later in 2023. In the interim, TDC would rely on its existing Procurement Procedure Rules and links to the Council’s Corporate Plan, Priorities and Projects.

Having taken into consideration that:-

(1) TDC had an ongoing vacancy at a senior level for Corporate Procurement and Contract Management and reinvestment through a contribution going into the wider procurement partnership would build further resilience and support to the organisation, in addition to the existing and successful arrangement with Essex County Council;

(2) the Shared Procurement Service was a partnership between several Councils in Essex which brought a number of benefits. Through joining the shared service and closer partnership approach, TDC would be able to ensure a high quality, resilient procurement service to support its needs and have influence over the direction of the Shared Procurement Service;

(3) TDC was providing a client side contact to manage the existing partnership agreement (SLA) with ECC; and that

(4) Social value considerations had been a requirement since 2012, however, policies were emerging on revised approaches for procurement, strengthening the opportunities to be achieved.

It was moved by Councillor G V Guglielmi, seconded by Councillor Stock OBE and:-