Agenda item

To consider a report from the Director of Strategy and Resources providing an update on the Council’s Procurement and Commercial Services. This follows consideration in previous municipal years and focuses on social value in procurement and effective contract management.

The Board considered a report from the Director of Strategy and Resources providing an update on the Council’s Procurement and Commercial Services. This follows consideration in previous municipal years and focused on social value in procurement, the Procurement Act (2023) and effective contract management.

In attendance for this item were:

·  Cllr Debra Coupar, Executive Member for Resources

·  Mariana Pexton, Director of Strategy and Resources

·  Victoria Bradshaw, Chief Officer Financial Services

·  Lewis Sinkala, Head of Procurement

·  Sasha Walton, Procurement - Social Value Team

The Head of Procurement delivered a presentation to the board setting out the key issues in the presented report. This covered the following areas:

·  Approaches to staff training and the number of staff who have accessed contract management training support

·  Developments in how the Council does contract management including the Contract Management Assurance Board, Contract Management Framework and contract balanced scorecards

·  Social Value and the lead role being played by the Council regionally in terms of social value being at the heart of procurement activity and being the only local authority to have a dedicated social value team

·  The Social Value Fund

·  Support to Leeds suppliers

·  The implications of the Procurement Act on how the Council operates including potential resource implications

Responding to comments and question from Board members the following discussion took place:

·  The Board asked about source to contract business cases and also the implications of the 2023 Procurement Act. Work is ongoing in this area and could be the focus of a future report to be brought to scrutiny.

·  On Value leakage the Board noted the 8.6% average value leakage which results from poor contract management and whether the Council has quantified the amount of value leakage within council contracts. The Board heard that a review is ongoing with Ernst & Young which is a phased approach to reviewing contracts with plans for these reviews to become part of standard practice across the Council and part of the contract management framework.

·  Members were keen to see as much social value included in contracts as possible potentially through partnership with anchor organisations. The Board heard that services can put a weighting of 20% in contracts and that this was in line with practice in other local authorities. Work is planned with anchor organisations in Leeds which will focus on social value and it was noted that social value commitments are contractual commitments and if the social value is not delivered then penalties can be applied.

·  In response to a question around mentoring and buddying the service was happy to set up more in terms of ensuring sharing of best practice and buddying arrangements are in place across Leeds and West Yorkshire in respect of social value and sharing of best practice across organisations.

·  The Board were keen to hear more about the new systems being planned and why the new tech had not been developed and delivered earlier. In response the Board heard that the public sector market is quite immature and driven by the incoming legislation, now is a good time to develop new systems and explore the market to find better tech to support the service and have fit for purpose systems moving forward.

·  The Board noted that the term ‘BAME’ features in the report and it shouldn’t given the Council is committed to using different languages to describe diverse communities. This was noted and will be avoided in the future.

·  The Board heard more about the social value engine and contract management approaches to deliver social value where it features in the contract. The number of meetings with suppliers will be determined by the value of the contract with more regular meetings with higher value contracts to ensure the social value is being delivered.

·  Members were also informed that the figures on social value were low at around 10% of the social value commitments in contracts largely because work is ongoing on social value to ensure that suppliers are evidencing delivery. Members were assured that where suppliers are not delivering then this will be contract managed through the Social Value Team.

·  The Executive Board Member for Resources noted the amount of work going on this area and the commitment to social value that the council has made through the establishment of the Social Value Team. Future update reports will look to evidence more clearly the delivery of social value by suppliers through their contracts with the Council. It was also emphasised that social value brings clear benefits to communities and can be used to offer career opportunities and support to people throughout the city.

Resolved

The Board:

a)  noted the contents of the report and endorsed the work underway to develop a Council-wide best practice approach to contract management.

b)  Identified procurement as a potential area of interest for the next municipal year.