Agenda item

To consider a report seeking approval to commence a housing and construction procurement exercise for suppliers of materials and sub-contractors delivered under the direct management of the Authority.

Cabinet received a report on the re-procurement of suppliers and sub-contractors following the expiry of the initial 2-year contract term following the transfer of the housing repairs, maintenance and construction service from Kier to the Authority.

The original contracts had an extension period built in, however it was deemed inappropriate to extend the contracts due to some market failures during the contract period and/or change to the Authority’s requirements.

Lessons learned from the previous exercise showed that there was a market for the services that the Authority required. The services procured in 2019 had been well received by tenants, with a seamless transition. High quality products had been maintained, and the team had engaged with suppliers and customers to pilot new products which had been well received.

It was intended that frameworks would be established with multiple suppliers, with larger packages of works being subject to mini-competition exercise. This would ensure value for money for the Authority. The frameworks would be for an initial term of either 2 or 3 years with an option to extend for a further year dependant on service requirements.

The following goods and services would be procured:

• Materials (plumbing, electrical, building, painting, timber, skips, glass and kitchens)
• Services (fencing, painting, minor works, scaffolding, roofing, plumbing and heating and electrical works)
• Design consultancy services

A new kitchen unit supplier was required and engagement would take place with tenants prior to the award of this contract.

Savings associated with the Construction Project and savings in the first year were circa £5.311 million. The spend within the borough had increased by 17% from previous years following the transfer of the service. It was hoped to surpass this in the re-procurement exercise.

A large majority of material suppliers were large national companies. However, it may now be possible to increase the local supply chain by re-packaging the offer to the market. The Covid-19 crisis had changed the supply chain, and some suppliers were now unfortunately in administration. The Authority had supported the supply chain where possible using supplier relief, business rates relief and the discretionary grant and would continue to engage with businesses and customers prior to commencing the tender exercise to ensure full understanding of the new emerging marketplace.

During the original procurement exercise engagement through social media had been successful with over 250 businesses attending events to understand the business on offer. This would be replicated as part of the re-procurement exercise. Virtual briefings would be provided together with a number of short ‘how to’ videos. Procurement pages and links to external organisations would be updated and would be easier to navigate. This would ensure smaller suppliers were able to tender.

The materials and services tender would support the Authority’s carbon reduction and recycling ambitions. Utilising the social value principles within the Procurement Strategy, the Authority would gain commitments of local employment and apprenticeships. This would contribute to the economic recovery of North Tyneside in the wake of the Covid crisis. The principles set out in the Authority’s Responsible Procurement Charter would be embedded in the tender requirements.

Cabinet considered the following decision options: to approvethe recommendationsset outinparagraph1.2 to carry out the necessary procurement exercises; or alternatively to not approvethe recommendations and continue to carry out tender opportunities for each package of works and/or services.

Resolved that (1) the procurement of the goods and services as detailed in the report be approved; and

(2) the Head of Environment, Housing and Leisure, in consultation with the Cabinet Member for Housing, the Head of Resources and the Head of Law and Governance, be authorised to commence a procurement to establish frameworks and award contracts to those bidders who represent the most economically advantageous tender and any subsequent call-off contracts.

(Reasons for decision: The Authority has a duty to obtain value for money. Tendering the opportunities identified in the report will meet the priorities contained within the Procurement Strategy and Our North Tyneside Plan. Should individual opportunities be tendered value for money and the associated benefits may not be achieved.)