Agenda, decisions and minutes

1.1  There were no apologies for absence

The Chair will consider the admission of any late items of Urgent Business. Late items of Urgent Business will be considered under the agenda item where they appear. New items of unrestricted urgent business will be dealt with under Item 10 below. New items of exempt urgent business will be dealt with at Item 15 below.

2.1  There was no urgent business.

A Member with a disclosable pecuniary interest or a prejudicial interest in a matter who attends a meeting of the authority at which the matter is considered:

(i) must disclose the interest at the start of the meeting or when the interest becomes apparent, and

(ii) may not participate in any discussion or vote on the matter and must withdraw from the meeting room.

A Member who discloses at a meeting a disclosable pecuniary interest which is not registered in the Register of Members’ Interests or the subject of a pending notification must notify the Monitoring Officer of the interest within 28 days of the disclosure.

Disclosable pecuniary interests, personal interests and prejudicial interests are defined at Paragraphs 8.1-15.2 of Section Two of Part 5 of the Constitution  and Appendix A of the Members’ Code of Conduct.

A Member with a disclosable pecuniary interest or a prejudicial interest in a matter who attends a meeting of the authority at which the matter is considered:

(i) must disclose the interest at the start of the meeting or when the interest becomes apparent, and

(ii) may not participate in any discussion or vote on the matter and must withdraw from the meeting room.

A Member who discloses at a meeting a disclosable pecuniary interest which is not registered in the Register of Members’ Interests or the subject of a pending notification must notify the Monitoring Officer of the interest within 28 days of the disclosure.

Disclosable pecuniary interests, personal interests and prejudicial interests are defined at Paragraphs 8.1-15.2 of Section Two of Part 5 of the Constitution  and Appendix A of the Members’ Code of Conduct.

3.1  There were no declarations of interest.

On occasions part of the Cabinet Procurement Committee meeting will be held in private and will not be open to the public if an item is being considered that is likely to lead to the disclosure of exempt or confidential information. In accordance with the Local Authorities (Executive Arrangements) (Meetings and Access to On occasions part of the Cabinet Procurement Committee meeting will be held in private and will not be open to the public if an item is being considered that is likely to lead to the disclosure of exempt or confidential information. In accordance with the Local Authorities (Executive Arrangements) (Meetings and Access to Information) (England) Regulations 2012 (the “Regulations”), members of the public can make representations about why that part of the meeting should be open to the public.

This agenda contains exempt items as set out at Items 13 to 15.

No representations with regard to these have been received.

This is the formal 5 clear day notice under the Regulations to confirm that this Cabinet Procurement Committee meeting will be partly held in private for the reasons set out in this Agenda.  Information) (England) Regulations 2012 (the “Regulations”), members of the public can make representations about why that part of the meeting should be open to the public.

This agenda contains exempt items as set out at Item 13 to 15.

No representations with regard to these have been received.

This is the formal 5 clear day notice under the Regulations to confirm that this Cabinet Procurement Committee meeting will be partly held in private for the reasons set out in this Agenda.

4.1  There was no notice of intention to conduct business in private or  any

  representation received.

5.1  There were no deputations, petitions or questions.

To confirm the unrestricted minutes of the meeting of Cabinet Procurement

Committee held on 16 January 2023.

RESOLVED:

To agree the minutes of the previous meeting as a correct record.

RESOLVED:

To agree the minutes of the previous meeting held on 13 February 2023 as a correct record.

RESOLVED:

1.  To note the various options considered in the procurement of the Council Insurance contracts.

2.  To agree the award of contracts for the following insurance services:

LOT No   Policy Coverage   Successful Provider

1    Property Deferred   See Item 3.4

2    Casualty (Liability)

  & Fidelity Guarantee      Supplier G

  3    Motor Fleet      Supplier F

  4    Engineering Inspection

  & Insurance   Supplier B

  5    Personal Accident/

  Business Travel   Supplier H

  6    Terrorism   Supplier A

3.  To approve officers to proceed with the contracts to ensure that insurance cover is in place for 1st April 2023.

4.  To delegate authority to the Group Director, Finance and Corporate Resources to award the contract for the [lot 1 - Property] contract under terms as shall be agreed, in consultation with the Chair of Cabinet Procurement and Insourcing Committee, by the Director of Legal, Democratic and Electoral Services, and authorise the Director of Legal, Democratic and Electoral Services to prepare, agree, settle and sign the necessary legal documentation to effect the proposals contained in this report.

Reason(s) For Decision / Options Appraisal

The Council will always be exposed to a range of risks, some of which are insurable and others are uninsurable. The purchase of an effective insurance portfolio manages the potential exposure of the Council to the insurable risks.

The portfolio includes a significant degree of self-insurance, thereby avoiding what can best be described as “pound swapping” i.e. the additional premiums paid for low or no excess on insurance policies effectively cost £1 for £1 on meeting claims payments plus associated costs, and ensuring that the Council benefits from the reduction in claims.

This report covers the insurance policies and arrangements which are due for renewal on 1st April 2023 and excludes the residential leasehold buildings insurance contracts, which are still within contract and which have historically been served by a separate procurement exercise.

As mentioned in the Cabinet Member’s introduction, there was some concern that insurance premiums the Council could have faced prior to the procurement exercise would have resulted in increased costs to the Council. There was further concern that in the marketplace some insurers maintained caution about the risk profile of the public sector. Consequently the Council’s Insurance Services Team has worked hard to mitigate claim exposures and to demonstrate to leading Insurers that the Council has implemented effective control measures and is willing to work hard in partnership with them to transfer or mitigate the risks it is exposed to.

Recommendations to award the contracts to the list of suppliers set out in the main section of this report for Lots 2-6 are the most economically advantageous. This reflects high quality scores for those selected. The price/quality evaluation varied between the types of insurance and a full breakdown of what this covered is included within Appendix B - Costs & Service Comparison Summary (Exempt)

In total the estimated savings in respect of Lots 2 - 6 for the 2023/24 premium over the current contracts are expected to be c.£90k, with the largest saving arising from  ...  view the full decision text for item 7.

7.1  The Head of Insurance introduced the report, highlighting the following:

·  The results from a tendering exercise in the autumn of 2022 over 6 lots, effectively covering the primary parts of the Insurance Programme and liabilities of 3rd parties to the council.

·  The 6 lots were spread between property, liability, motor fleet, engineering and inspection, insurance risk, personal accident/ business and terrorism; 

·  The contract was to be awarded on a 3+2 basis with a period of 2 years being optional at the discretion of the Council;

·  The procurement process had been challenging with the market changing its attitude to risk, in particular with reference to property risk;

·  At the outset of the tender exercise there was some concern that the council may not be able to consolidate the competitive premium rates achieved at the time of the 2018 tender;

·  The terms provided for all bids under Lot 1 - Property represented a clear hardening of the market and the overall result of the market exercise, compared to premium spend in 2022/23, was likely to lead to a significant premium increase;

·  In relation to Lot 1 there was a request for delegated authority to the Group Director of Finance and Corporate Resources in consultation with the Chair to award the contract. A progress report would be submitted to the March  meeting of the Committee on this matter; Lots 2-6 had received a good response from the market with 8 bidders with a potential small saving to the Council. 

7.2  Councillor Kennedy asked for clarification on the following:

·  Why the heritage insurance had been withdrawn;

·  The premium increase in relation to Lot 1 was estimated to be up to 55% and was there a cause for concern. It was not clear how much extra that was likely to be over the lifetime of the contract.

7.3  The Head of Insurance responded that:

·  The fine art premium was within the procurement regulations that allowed the Council to negotiate renewal terms each year. The premium was generally around 3-4K with a certain risk. Therefore, the decision had been  taken to work through the contracting broker to negotiate the terms rather than undertake a full procurement process;

·  In relation to Lot 1 it was necessary to consider the entire risk, not just the premiums and a further evaluation was required. There were a range of figures before the 55% premium increase level. It was considered that there was the capacity to meet these demands with an emphasis on the certainty of risk transferred to the winning supplier.

RESOLVED:

1.  To note the various options considered in the procurement of the Council Insurance contracts.

2.  To agree the award of contracts for the following insurance services:

LOT No   Policy Coverage   Successful Provider

1    Property Deferred   See Item 3.4

2    Casualty (Liability)

  & Fidelity Guarantee      Supplier G

  3    Motor Fleet      Supplier F

  4    Engineering Inspection

  & Insurance   Supplier B

  5    Personal Accident/

  Business Travel   Supplier H

  6    Terrorism   Supplier A

3.  To approve officers to proceed with the contracts  ...  view the full minutes text for item 7.

RESOLVED:

1.  To award the contract for the delivery of the Advocacy Service to

Provider C for a period of up to 5 years commencing in June 2023 at

a maximum cost of £2,645m (an average of £529k per annum). The

contract is for 3 years with the option to extend for up to 2 years

(1+1);

2.  To award an extension to the current providers of the Advocacy

Service, for a period of 2 months (April - May 23) at maximum value

of £104,707.00 (£97k & £7.7k) . This is to enable the newly appointed

bidder to mobilise effectively, without disruption to service delivery.

Reason(s) For Decision / Options Appraisal

This report asks CPIC to approve the award of contract for an Advocacy service under a lead provider aimed at supporting vulnerable cohorts who are in need of advocacy services to support their well-being, enable them to have their voices heard and to live their lives in dignity and in accordance with their wishes

This provision will enable the Council to meet its statutory obligations with regard to providing independent advocacy services as required under the relevant Acts referred to in section 2.2.

The contract will deliver advocacy support to meet local need through a range of community providers under the leadership and direction of a lead provider.

The current Advocacy services in the London Borough of Hackney are designed to provide issue-based advocacy and can be categorised as statutory and non-statutory advocacy services.

Alternative Options (Considered and Rejected)

The following 5 options were appraised for the future of the Advocacy provision in the borough:

·  Alternative Option 1: Insource

·  Alternative Option 2: Remain As Is

·  Alternative Option 3: Activity Based Contract

·  Alternative Option 4: Separate Contracts/Multiple Providers

·  Alternative Option 5a: No Non Statutory Advocacy Delivery:

·  Alternative Option 5b:  Reduced Non Statutory Delivery

·  Alternative Option 5c Seek Separate Funding

Hackney Procurement Board approved the business case for the preferred procurement option in September 2022

8.1  The Strategic Commissioner introduced the report, highlighting the following:

·  The report asked the Committee to approve the award of contract for the Advocacy Service and to extend the current contract to enable the mobilisation period for the award;

·  The Advocacy Service assisted underserved groups to give them a voice;

·  The new contract would be 3 +1+1 years at a maximum cost for £2,645m

·  The contract award followed a comprehensive review of advocacy;

·  A business case for the service was taken to the Hackney Procurement Board in September 2022;

·  An improved specification had been developed following lessons learned from the commissioning review;

·  There had been co-production throughout the various processes;

·  There would need to be a review of the sustainability of the service;

·  There had been an 80/20 split on quantity and price;

·  Funding for the non-statutory elements would be tapered down over the life of the contract;

·  All non statutory aspects would be allocated to local, small and medium sized enterprises;

·  4 good bids had been received by the Council with the successful bidder committed to paying the London Living Wage, ensuring the most vulnerable voices were heard, developing capacity, including expanding the existing network, paying for training and supporting through advocacy leadership. Further, new forms of advocacy would be developed to empower Hackney citizens. The bid was in line with sustainable procurement and social value requirements. The provider showed a good understanding of inequalities locally;

·  Monitoring of the service would be carried out quarterly.

8.2  Councillor Woodley asked for clarification on the Group Director’s

comments in relation to the anticipated expenditure each year and the possibility of increased cost pressures.

8.3  The Strategic Commissioner responded that the Budget had reduced

from £535K to £529K. In order to meet the large demand in statutory advocacy efforts were being made to reduce the non-statutory elements of the service. There would be a need for dialogue with the provider as the Liberty Protection Safeguards come in. If demand increases for the service it may be necessary to negotiate with the provider on the contract. 

RESOLVED:

1.  To award the contract for the delivery of the Advocacy Service to

Provider C for a period of up to 5 years commencing in June 2023 at

a maximum cost of £2,645m (an average of £529k per annum). The

contract is for 3 years with the option to extend for up to 2 years

(1+1);

2.  To award an extension to the current providers of the Advocacy

Service, for a period of 2 months (April - May 23) at maximum value

of £104,707.00 (£97k & £7.7k) . This is to enable the newly appointed

bidder to mobilise effectively, without disruption to service delivery.

Reason(s) For Decision / Options Appraisal

This report asks CPIC to approve the award of contract for an Advocacy service under a lead provider aimed at supporting vulnerable cohorts who are in need of advocacy services to support their well-being, enable them to have their voices heard and to live their lives in  ...  view the full minutes text for item 8.

RESOLVED:

To approve a contract variation, to extend by a maximum period of six (6) months, the current contract for Modern Tools for Housing software development services.

REASONS FOR DECISION & OPTIONS APPRAISAL

The proposed contract variation is essential to enable continued delivery of essential software tools for housing services and ensuring an effective transition to in-house delivery and support.

The cyber-attack of October 2020 has impacted significantly on the Modern Tools for Housing programme because that meant that the previous housing system (Universal Housing) became unavailable and it was therefore no longer possible to deliver a phased migration from the old system to new software. As a result, teams in housing services have been required to use interim solutions to deliver services while new software is delivered.

Following the decision to commission a strategic review of the housing service’s technology needs it was necessary to identify the best value approach for continued delivery of current work in progress while the review takes place and ongoing direction is agreed. Variation of the current contract is recommended on the grounds that:

·  The work required covers critical functionality required by the housing service;

·  The variation includes transition to the in-house ICT team for support and further development of essential functionality pending the completion of the strategic review. No further variation of this contract will be required;

·  Variation of the current contract removes the requirement for transition / handover, so the pace of delivery is uninterrupted while the strategic review is in progress.

Variation of this contract is permitted under Regulation 72 which states:

72(1)(b) for additional works, services or supplies by the original contractor that have become necessary and were not included in the initial procurement, where a change of contractor—

(i) cannot be made for economic or technical reasons such as requirements of interchangeability or interoperability with existing equipment, services or installations procured under the initial procurement, and

(ii) would cause significant inconvenience or substantial duplication of costs for the contracting authority,

provided that any increase in price does not exceed 50% of the value of the original contract

The proposed variation is 50% of the original contract value. Changing contractor is not considered viable for the reasons set out in 5.3 (above). Specifically, a change of contractor would:

·  Delay the delivery of essential functionality required by Housing services, whose legacy system was rendered unavailable by the criminal cyberattack of October 2020;

·  Incur additional costs and significant inconvenience through requiring transition to a new contractor and delaying the transition to the in-house support and development model;

·  Incur duplication of costs through otherwise unnecessary handover prior to the transition to in-house support and development;

·  No further variation will be required once the transition to the in-house model is complete.

The Director of Climate Homes and Economy Finance has confirmed that this additional expenditure can be funded from within their existing budgets and no other additional funding will be required.

ALTERNATIVE OPTIONS (CONSIDERED AND REJECTED)

In October 2022, when the original contract  ...  view the full decision text for item 9.

9.1  The Strategic Director, Customers and Workplace introduced the report,

 highlighting the following:

·  A supplementary paper on this matter had been circulated to members of the Committee;

·  The contract variation was to replace the previous outdated software with a transition to in-house support and to enable further delivery for products that had been developed in the context of the strategic review;

9.2  Councillor Kennedy referred to the fact that the funding for the extension

was in the housing capital budget and asked for clarification in relation to the length of the previous contract.

9.3  Councillor Woodley asked for confirmation that the work was now aligned with the strategic review and that there would be no other requests for extensions to the contract. 

9.4   The Strategic Director, Customers and Workplace confirmed that work had been carried out with the Housing Department on this matter with provision made within the Capital Housing budget for the contract extension. Further, there was provision in the current contract for an extension to that contract with a report to the Committee because of the transfer to the in-house team. He confirmed that there would be no further extensions to the contract.

RESOLVED:

To approve a contract variation, to extend by a maximum period of six (6) months, the current contract for Modern Tools for Housing software development services.

REASONS FOR DECISION & OPTIONS APPRAISAL

The proposed contract variation is essential to enable continued delivery of essential software tools for housing services and ensuring an effective transition to in-house delivery and support.

The cyber-attack of October 2020 has impacted significantly on the Modern Tools for Housing programme because that meant that the previous housing system (Universal Housing) became unavailable and it was therefore no longer possible to deliver a phased migration from the old system to new software. As a result, teams in housing services have been required to use interim solutions to deliver services while new software is delivered.

Following the decision to commission a strategic review of the housing service’s technology needs it was necessary to identify the best value approach for continued delivery of current work in progress while the review takes place and ongoing direction is agreed. Variation of the current contract is recommended on the grounds that:

·  The work required covers critical functionality required by the housing service;

·  The variation includes transition to the in-house ICT team for support and further development of essential functionality pending the completion of the strategic review. No further variation of this contract will be required;

·  Variation of the current contract removes the requirement for transition / handover, so the pace of delivery is uninterrupted while the strategic review is in progress.

Variation of this contract is permitted under Regulation 72 which states:

72(1)(b) for additional works, services or supplies by the original contractor that have become necessary and were not included in the initial procurement, where a change of contractor—

(i) cannot be made for economic or technical reasons such as requirements of interchangeability or interoperability with  ...  view the full minutes text for item 9.

10.1  There was no other unrestricted business that the chair considered

urgent.

Meetings will be held on:

13 March

17 April

11.1  The next meeting of the Committee will be on 13 March 2023.

Note from the Governance Services Manager

Item(s) 13 to 15 allows for the consideration of exempt information in relation to items  respectively.

Proposed resolution:

THAT the press and public be excluded from the proceedings of the Cabinet Procurement Committee during consideration of Exempt items 13 to 15 on the agenda on the grounds that it is likely, in the view of the nature of the business to be transacted, that were members of the public to be present, there would be disclosure of exempt information as defined in paragraph 3 of Schedule 12A to the Local Government Act 1972 as amended.

THAT the press and public be excluded from the proceedings of the Cabinet Procurement Committee during consideration of Exempt items 14-18 on the agenda on the grounds that it is likely, in the view of the nature of the business to be transacted, that were members of the public to be present, there would be disclosure of exempt information as defined in paragraph 3 of Schedule 12A to the Local Government Act 1972 as amended.

TO FOLLOW

The report under item FCR S143 Procurement of Insurance Core Provision is, at the time of this publication, unavailable due to necessary validation and due diligence checks.

13.  The Committee noted the exempt appendices

14.  The Committee noted the exempt appendices.

15.  There was no other exempt business that the chair considered urgent.