Agenda item

Purpose: To receive a briefing on the procurement processes in place within the Council to inform a potential review. 

The Committee considered a report (Agenda Item 5) detailing the procurement processes in place across the Council.

Discussion returned to the process followed with the CCTV contract and Mike Sullivan made the following points:

·                    Procurement Officers did get involved in the procurement of this contract, but not until the second stage when it transpired that the OJEU requirements had to be followed.  

·                    The contract had been awarded to the Royal Borough of Windsor and Maidenhead after the restricted procurement process had been followed.  This was the default process undertaken by the Council as set out in the Constitution.

·                    The restricted process was held over two stages.  The first stage was open to companies to express an interest and submit copies of pre qualification documents.  These were then evaluated in advance and short listed companies were invited to enter into the second stage of the process. 

·                    Open procurement processes were not, as a rule, conducted by the Council and could only be entered into with the approval of the Head of Finance and Head of Legal and Electoral Services.  This procedure involved the provision of all appropriate documentation to all companies who had expressed an interest.

Mike Sullivan then went on to describe the more general procurement processes:

·                      Financial thresholds were in place.  Under the Council’s Contract Rules of Procedure (Part 12 of the Council Constitution), a minimum of one supplier was required to quote for contracts valued at lower than £10k, although a larger number was recommended by Procurement in order to ensure best value.

·                      A minimum of three suppliers were required to quote for contracts valued between £10k and £50k. 

·                      Service areas were not required to inform Procurement of contracts valued at lower than £50k, although advice was at times sought. 

·                      Procurement had been proactive in offering support to service areas where possible.  This included the Quick Quote facility available to service areas on the Council’s procurement portal.  This contained a list of suppliers who had registered against specific sectors listed on the supplier side of the portal.  This would ideally be rolled out for all contracts as well as the e-tendering process.  Attempts had also been made to establish a list of forthcoming contracts so that these could be appropriately planned and all relevant service areas involved.

·                      Five potential suppliers were required for contracts valued between £50k and the European Union (EU) threshold of £156k.  This threshold was for services and supplies; the capital works threshold was set at £3.9m.  Service areas were required to notify Procurement of contracts valued at over £50k.  It was confirmed that it was not compulsory for suppliers to be listed on the procurement portal to be able to bid for these contracts, but to access contract opportunities and to receive information relating to those opportunities, they would have to register on the portal in the first instance.   

·                      Contracts valued above the EU financial threshold of £156k had to be advertised in the OJEU in accordance with the Public Contracts Regulations 2006.     

There was a view among Members that all contracts should at least be signed off by Procurement.  Mike Sullivan agreed that from the procurement side it would be a benefit to at least be aware of all contracts so that a full picture was known.  This should ideally take the form of a mandate for Procurement to be kept informed of contracts to improve management and ensure appropriate procedures were followed.  However the potential number involved, particularly when considering those of less than £10k, would most likely mean that Procurement would not have the resources to support them all.  Mike Sullivan agreed to establish approximately how many contracts this would mean on a monthly basis across the different thresholds. 

Councillor Keith Chopping agreed with the need for appropriate sign off of all contracts and the level at which this happened, and the process, needed to be established. 

Leigh Hogan informed Members of an audit currently being undertaken into the Council’s procurement processes and queried whether any further scrutiny work should be put on hold until the audit had concluded.  This had been agreed between the Council and Improvement and Efficiency South East, and was to be provided free of charge.  Andy Walker advised that the decision had been made to conduct the audit as it was felt to be timely five years on from the closure of the Amey contract.   

Councillor Chopping was eager to avoid any duplication of effort between the audit and the scrutiny work.  Councillor Jeff Brooks was of the view that scrutiny had a role of feeding into the audit.  It was therefore agreed that the full detail of this work would be provided to Members. 

Efforts had been made to increase the number of suppliers on the procurement portal.  This included an event held with local small and medium sized enterprises (SME’s) in November 2009.  This had been successful and there were approximately 1700 suppliers on the portal at the present time.  SME’s were being particularly encouraged to register on the portal in order to have access to future contract opportunities.  Information was requested on the SME’s who were registered on the portal. 

Councillor Chopping gave his support to the procurement of local goods and services in order to help local businesses. 

Members felt this was a very delegated and widely rolled out process.  A mandate was felt to be needed that centralised procurement and utilised the experts in the Procurement team.  The Select Committee therefore agreed to conduct further work on this topic.  A time limited procurement working group, that was established four years ago, was referred to and it was agreed that the report produced as a result of this work would be circulated. 

Procurement Officers were asked to return to the next meeting to outline best practice for carrying out procurement and to provide an update on progress with the audit. 

As a final point Mike Sullivan informed Members that the new requirement for public sector organisations to publish all purchases over £500 could be time consuming for Procurement.  

RESOLVED that:

(1)       Procurement Officers would return to the next meeting to outline best practice for carrying out procurement and to provide an update on progress with the audit.  In addition, the following information would be provided by Procurement to aid discussions:

·              The approximate number of contracts being agreed on a monthly basis for the different threshold levels, separated between utilities and service funds. 

·              The sign off process for the different threshold levels.

·              The detail of the audit.

·              The SME’s registered on the portal. 

(2)       The report produced by the procurement working group would be circulated by Stephen Chard to the Select Committee.