Governance and Transformation Cabinet Member – Minutes – 30 November 2016

30      (30)    ARMED FORCES COVENANT AND PROCUREMENT – The Director of Policy and Resources submitted a report that sought the promotion of the Armed Forces Covenant to council suppliers through procurement initiatives.

The report explained that the council was a signatory to the Armed Forces Covenant. The covenant was a public sector pledge from government, businesses, charities and organisations to demonstrate their support for the armed forces community.  It was brought in under the Armed Forces Act 2011 to recognise that the whole nation had a moral obligation to redress the disadvantages the armed forces community faced in comparison to other citizens, and recognised sacrifices made.

Businesses and charitable organisations who wished to demonstrate their support for the Armed Forces community can sign the covenant.  Organisations can make a range of written and publicised promises to set out their support to members of the Armed Forces community who work in their business or access their products and services.

The level of support would depend on the size and nature of the organisation but typically included policies that: encourage reserve service; support employment of veterans and service spouses/partners; give the Armed Forces community a fair deal on commercial products and services.

More than 800 businesses and charities had signed an Armed Forces Covenant, and that number continued to grow.  Government wanted to encourage this.

Crown Commercial Services had recently issued a procurement policy note (06/16) encouraging public bodies to promote the covenant to their suppliers through procurement.

The council had a nationally recognised approach to the delivery of its policy objectives through procurement utilising new and progressive social value flexibilities. It was proposed to utilise social value flexibilities to promote the covenant initially through two specific initiatives:

encourage suppliers and prospective suppliers to sign up to the covenant by signposting them to it through procurement resources such as the Selling to the Council guide and Buy4Northern Lincolnshire website.  Attached to the report was the text for inclusion in the Selling to the Council guide and Buy4Northern Lincolnshire website); and

in the first instance encourage the council’s construction framework partners to sign up to the covenant as part of the framework’s nationally recognised focus on social value outcomes

In respect of the above, the proposals would not require a supplier to be a signatory to the covenant in order to work for the council.

Resolved – That the promotion of the Armed Forces Covenant through procurement, as detailed at paragraph 2.6 of the report, be approved.

31      (31)    CONTRACT AWARD – SUPPLY OF NATURAL GAS – The Director of Policy and Resources submitted a report that, as per the council’s Contract Procedure Rules for all procurements over £1m, informed the Cabinet Member of the outcome of a Yorkshire Purchasing Organisation led procurement for the supply of natural gas to council sites.

Cabinet previously agreed to the procurement of energy related contracts via the Yorkshire Purchasing Organisation (YPO) in line with the council’s category management strategy and the outcomes of the Pan-Government Energy Project, specifically that all public sector organisations should adopt an aggregated, flexible and risk managed energy procurement through a recognised Central Purchasing Body.

Prior to the current flexible purchasing approach, electricity and gas were purchased through fixed price contracts.  This was effective in securing best value when the energy markets were stable.  However, in recent times the energy markets had become more volatile with wholesale prices subject to substantial fluctuations.

Under a fixed term contract approach the council would be required to purchase electricity or gas at the time the fixed term contract expired to ensure continuity of supply.  There was a risk that this coincided with a time when prices were high and therefore that the council would be locked into a high price contract for the next fixed term period, usually 3 to 4 years.  These arrangements typically involved volume tolerances and inflexible consumption terms (“take or pay”) which impact value for money.  For this reason the Pan-Government Energy project recommended a flexible purchasing approach.

Flexible purchasing meant buying the annual requirement for electricity or gas in regular amounts in advance over a period (usually twelve months).  This enabled purchases to be timed to avoid unusual market price spikes and also spread the risk of price fluctuations.

It did not guarantee that all energy was purchased at the lowest possible price available during a particular period but experience during the current contract had shown that overall this approach had resulted in procurement at below average prices.

In addition, the aggregation of demand with other public sector bodies via the YPO energy consortium (representing 9,000 supply points across the region) had resulted in further price advantages through economies of scale, reduced management fee and a dedicated customer service and account management team.

The council’s current contract with British Gas for the supply of gas was due to expire on 31 March 2017.  Due to the requirement under flexible purchasing for the contractor to buy gas in advance, it was necessary to put in place a new contract well before the end of the current contract to allow sufficient time for the benefits of flexible purchasing to be realised.

Consequently YPO had undertaken an Official Journal of the European Union (OJEU) compliant procurement process to identify a supplier for the next contract period.

An open tender process was conducted; thirteen suppliers accessed the tender, four submitted responses and met all mandatory requirements, listed below.

  • British Gas
  • Corona Energy Limited
  • DONG Energy Sales UK
  • Total Gas and Power Limited

The tenders were evaluated by YPO in accordance with the following weighting

  • Cost    35%
  • Quality          65%

Corona Energy Ltd achieved the highest overall score.

YPO recommended that the energy consortium members enter into a contract with Corona Energy Limited for the supply of gas from 1 April 2017 to 31 March 2021. The council had confirmed its commitment.

Resolved – That the outcome of the YPO led gas supply procurement be noted.

32      (32)    REGISTRATION SERVICE – FUTURE DEVELOPMENT – The Director of Places submitted a report that sought approval to for more collaborative working with North East Lincolnshire Council and Lincolnshire County Council to improve registration services for customers.

The registration of births and deaths was provided free of charge.  Fees were set nationally for other statutory services such as certified copies of registration entries and designated Register Office weddings.  Local fees can be applied to discretionary services e.g. non Register Office wedding ceremonies and name changing service.

The Registration Service currently aimed to operate at nil net cost or better.  The council continually reviewed how it delivered its services to improve access for customers and achieve the best possible value for money.  Recently this had included exploring the potential benefits of sharing of services with neighbouring councils.  The council’s budget plans included a saving target of £15,000 for the Registration Service from potential shared service arrangements across 2016/17 and 2017/18.

Registration legislation required local authorities to prepare a Registration Scheme for the organisation of the Local Registration Service in its area and a supporting service delivery plan (SDP).  This included setting out boundaries for Registration Districts for marriages and Sub-Districts for the registration of births and deaths.  This formed a legal agreement between the Registrar General and the local authority.  There was some scope to revise the SDP to reflect local changes.  This might include adjusting levels in response to local demand.

Currently, births and deaths must be registered in the district in which they occur. However informants can make a declaration of a birth or death at any register office.  This had to be forwarded on to be recorded in the registration district where the event occurred.  Notices of marriages must be attested in the district in which the person giving notice lived.

Lincolnshire and North East Lincolnshire also operated as separate registration districts.  This could prove confusing for informants, especially those living on the borders of other registration districts.  It was not legally possible to merge these into one registration district at this time.  However, there could be ways the council could work together to deliver services more effectively for the customer.

In light of these issues Registration Services staff had met with colleagues in Lincolnshire and North East Lincolnshire to explore potential for working together.

While there was a view at this time that a formal shared service arrangement may not be needed, all parties agreed that there may be scope to work more collaboratively to deliver operational benefits and some financial efficiencies.  Any future collaborative arrangements could be underpinned by service level agreements where necessary.

Managers from all three services had identified three main areas for potential further development.  These included –

  • Training,
  • Cross-boundary registration and notices, and
  • Staff deployment / resilience.

Resolved – (a) That the progression of work to develop proposals for more collaborative working with North East Lincolnshire Council and Lincolnshire Council, as outlined in option 1 of the report be approved, and (b) that further progress reports be received as the project develops.

33      (33)    TRADING STANDARDS BUSINESS ADVICE POLICY – The Director of Places submitted a report that sought the introduction of a Business Advice Policy.

The Regulatory, Enforcement and Sanctions Act 2008 introduced the Primary Authority Partnership scheme.  Primary Authority Partnerships offered businesses the opportunity to form a legally recognised partnership with one local authority, which then provided robust and reliable advice for other councils to take into account when carrying out inspections or dealing with non-compliance.  This provided businesses with formal advice which not only ensured compliance but also protected them against prosecution from other authorities.  This reduced the cost of non-compliance to businesses.

Businesses were eligible for the Primary Authority Partnership if they were regulated, by two or more local authorities, i.e. they trade in more than one local authority area.

Alternatively, they were eligible if the business was part of a group of businesses that all followed the same regulatory approach and relied on the same guidance managed by a third party, usually a trade association or franchisor.

Businesses wishing to make use of the Primary Authority Partnership pay for the advice given.  The former Cabinet Member for Highways and Neighbourhoods approved a report giving Trading Standards the authority to enter into Primary Authority relationships on behalf of the Council for the purpose of the Regulatory Enforcement and Sanctions Act 2008 and to make a charge for advice given under the scheme.

Currently businesses within North Lincolnshire that were not part of a Primary Authority Partnership received free unlimited advice.  This advice can range from general guidance on legislation to more complex advice on individual product specifications and labelling.

Currently, the council had no Primary Authority Partnerships in place.  One of the reasons why businesses were not willing to enter into a Primary Authority Partnership was because they were currently getting free business advice.  They therefore don’t feel the need, despite the other benefits that a Primary Authority Partnership arrangement can offer, i.e. formalised inspection plans, legally binding published advice.

It was therefore proposed to introduce a Business Advice Policy to establish boundaries on what advice would and wouldn’t be provided for free.  In line with the council’s drive to encourage self-service, this would hopefully allow businesses to find the answers to simple queries for themselves.  It would also encourage businesses to enter into Primary Authority Partnerships rather than continually contact the service for advice without charge.  The Business Advice Policy was attached to the report as an appendix.

A number of Trading Standards Authorities locally had decided to stop or limit the advice given to businesses unless they pay for it via a Primary Authority Partnership.  It was hoped this policy would still support business whilst encouraging them to go down the Primary Authority Partnership route.

There was no statutory requirement to provide businesses with advice and more and more councils were now taking the decision to stop providing free business advice as resources diminish.  As a result, businesses were forced to seek advice from elsewhere, such as solicitors or trade bodies.  This could prove more costly than paying for advice from local authorities.

Resolved – That the adoption of the Trading Standards Business Advice Policy be approved.