Agenda item

The Scrutiny and Overview Committee is asked: -

1.        To note the report due considered by the Mayor at the Cabinet meeting on 6 March 2022.

2.        To consider whether there are any recommendations or observation arising from the Sub-Committee’s consideration of the report to the submit for the consideration of the Mayor at the Cabinet meeting.

The Sub-Committee considered a Cabinet report, set out in the agenda supplement, about the re-procurement of the responsive repairs contract, which included recommendations on the contract award for decision by the Mayor. The report had been included on the agenda to allow the Sub-Committee to review the content prior to the decision being taken, providing the opportunity to flag any recommendations for the consideration of the Mayor as part of the decision.

The Cabinet Member for Homes, Councillor Lynne Hale, the Corporate Director for Housing, Susmita Sen, the Director of Housing – Estates & Improvement, Stephen Tate, the Head of Repairs and Maintenance, Jerry Austin, the Strategic Procurement Manager, Matthew Devan, the Finance Manager, Orlagh Guarnori, the Local Government Association (LGA) Procurement Improvement Advisor, Nigel Kletz and from Echelon, the Council’s advisor on the process, Peter Gudge all attended the meeting for this item.

In introducing the report, the Cabinet Member highlighted the importance of the contract to the Council and its residents, thanking officers for their hard work over the past year in managing the procurement process and thanking the residents who had been involved in the process.

Following the introduction, the Sub-Committee had the opportunity to ask questions on the content of the report. The first question raised by the Sub-Committee asked whether the key performance indicators (KPIs) had already been set or would be set in collaboration with the preferred bidders. It was advised that a set of KPI’s were included within the contracts, but there was a mechanism in place to add, amend or remove KPI’s as needed to improve the process. Any changes would be subject to the approval of both parties. It was highlighted that the KPI’s relating to customer service had been designed with residents to improve their validity.

It was agreed that a copy of the contract would be shared with the members of the Sub-Committee once it had been signed. It was envisioned that it would be signed by the end of April 2023 to ensure mobilisation could begin in May.

It was confirmed that provision had been included in the contract to ensure that all parties had a responsibility to flag as a priority any emerging issues that could affect the delivery of the contract. There was also a requirement for all parties to engage in quarterly value engineering sessions to identify improvement.

Responding to a question about how the risk of challenge against the contract award decision had been mitigated, it was highlighted that the process had been conducted within the specified timescale, with a clear process and opportunities for bidders to raise queries. There had been one minor issue with a specific supplier who was initially excluded from bidding, but after a successful challenge had been included again. However, in the end that supplier had decided not to submit a bid. The process had been fair to all bidders, with robust answers provided and additional time allowed to respond where needed. It was acknowledged that the risk of challenge was ever present and it would not be known if there would be a challenge until the contract award was announced later in the month. The contract award process included a ten day standstill period, in which bidders could lodge a challenge, and legal advisors were on hand to guide any such eventuality.

It was questioned whether the challenging time frame for mobilisation could still be met in the event of a challenge being lodged. In response, it was advised that this would depend on the nature of the challenge. A period of five weeks had been built into the process to consult with leaseholders, which would provide additional time to respond to a challenge if needed. 25^th April 2023 was the target date for signing the contracts, with a week’s slippage built into the process, if required.

It was advised that managing the risks within the contract would require strong contract management processes, with a risk register developed which included the identification of relevant mitigation. It was confirmed that the risks highlighted in the report could be managed within the resources available in the Council.

Confirmation was welcomed that the contract would be able to evolve, to allow for a clear focus on continuous improvement using the value engineering approach. This could be applicable in areas such as the heating contract where the carbon reduction measures on the market were likely to improve over the life of the contract.

It was confirmed that the Council’s in-house procurement team had led on the bidder compliance checks. The qualification process included checking that suppliers were willing to sign up to a range of Council policies, with adherence required in the contract. Benchmarking of supplier performance had been reviewed as part of the process, with any identified issues being picked up through questioning.

It was agreed that tenant involvement had been a real strength of the procurement process to date. It was confirmed that resident involvement would continue throughout the mobilisation process and as part of the ongoing management of the contracts. It was important that the process for resident involvement was carefully designed and regularly reviewed to ensure that it continued to be meaningful. The responsibility for continued resident involvement rested with both the Council and the successful contractors.

It was confirmed that the appointment system for repairs would be managed by the Council, although for more complex issues it would likely take a more in-depth discussion to arrange. Unlike the previous contract, the Council would have ownership of the customer interface and would be able to monitor in real-time the status of appointments through the NEC software, which was in the process of being rolled out. Having reviewed the resources required to manage the customer contact centre, it was planned that additional staff would be recruited to help manage the period of change to the new system.

It was advised that operatives for the contractors would be geotagged, which meant that in the event of a dispute about attendance at appointments, their location could be verified. Contractors would also be expected to take a before and after photo of any repair work and to take a photo of a resident’s door if they were unable to access a property. As one of the contractors would be providing out of hours customer support, it was expected that the Council’s team would be provided with a log of issues raised out of hours each morning.

It was questioned how the contact centre staff would be trained to ensure they were able to ask the right questions to understand what repairs required. It was confirmed that the self-diagnosis system available to residents would also be used by contact centre staff and supplemented by additional contextual questions to develop a better understanding of the issue. It was essential that wider issues were identified at an early stage to prevent further escalation into a more significant problem.

There was concern raised about the potential for service disruption as the current contract reached its end, with information sought on how this would be managed. It was advised that there would be a dual approach used by firstly holding the current contractor to the performance levels specified in their contract and secondly ensuring other providers were available to pick up specific areas of work, such as voids, if needed. It was acknowledged that it could potentially be challenging to manage the performance of the current contractor in the lead up to the end of the contract and bed in the new contract. As such, this had been identified as an area of focus, that would be managed using data.

In response to a question about the biggest risks in the mobilisation of the new contracts, it was advised that risks included ensuring there was sufficient resource available to manage mobilisation, managing other interdependencies such as the installation of the new NES system, ensuring that the contractor suppling the out of hours service understood the Croydon situation and ensuring there were robust contract management systems in place. It was agreed that these risks would continue to be monitored by the Sub-Committee going forward.

It was confirmed that the social value elements identified within the contract would be monitored through KPIs by the contract management team, who would look to engage with social value experts to assist with monitoring. Experience at other local authorities indicated that this approach would work. The contract provided opportunity for the scope of the social value priorities to change as needed.

At the conclusion of this item the Chair thanked those present for their attendance at the meeting and their engagement with the questions of the Sub-Committee.

Actions arising from the meeting

Following the discussion of the re-procurement item at the meeting, the Sub-Committee agreed the following actions that would be followed up after the meeting.

1. That further information is provided to the members of the Homes Sub-Committee on the plans for demobilisation/mobilisation as these are finalised.
2. That a copy of the contract used with the suppliers is circulated to the Committee once available.

Conclusions

Following its discussion of this item, the Sub-Committee reached the following conclusions: -

1. The Sub-Committee commended the team for the hard work invested into managing the procurement process up to this date, particularly when it had been delivered within a relatively short time frame.
2. Although there was concern that the procurement had been opened for bids over the summer of 2022, it was accepted that the results of soft market testing provided a reasonable level of reassurance that a good range of bids had been received.
3. It was seen as a positive move that a dedicated team was being set up to manage the mobilisation process, but concern remained about the overall capacity within the Housing service to deliver the mobilisation process within the timescales available.
4. Key risks to the success of the new contracts included integration between the Council’s new NEC system and those of the contractors, and the ongoing work to improve the culture within the Housing service. As such these projected needed to be properly resourced to given them the best chance delivery. 
5. The involvement of residents throughout the procurement process was commended and the plans for ongoing engagement with residents on the delivery of the new contracts was seen as essential to rebuilding the trust of residents.