Issue - meetings

Report of the Interim Corporate Director Finance and resources

Steve Oakley, Head of Contracting and Procurement, introduced the report providing information to the Committee on 2, linked internal audits around Contract Management and Procurement Dispensations. He highlighted the following information:

(a)  A number of actions were highlighted for implementation across the Council to ensure that  Contract Procedure Rules are complied with and best value for money is achieved. This will bring the Authority in line with best practice recommendations and allow robust process to be implemented around contract management and procurement;

(b)  The Audit of those procurements where dispensation was granted found that a significant number would have provided better value for money had it gone out to market for the full tender process. All these procurements were below Procurement Regulations thresholds;

(c)  The introduction of Oracle Fusion is changing the way contract management takes place. It is now not possible for a team to spend more the £25,000 a year without the procurement and contract management team being informed so that checks to ensure that the correct tender process/quotes are in place, can be made;

(d)  Procurement plans are being collated for all directorates so that there is a good understanding of what procurement activity needs to take place when to ensure continuation of service provision, but also to allow time for best value for money to be achieved. CLT and divisional meetings allow work on these procurement plans for each division to be put in place ;

(e)  The team are now working with PriceWaterhouseCooper (PWC), to analyse the spend data and establish by comparison to best practice whether best value has been obtained by the method of service provision and contract or direct provision arrangements in place. The aim is to spotlight areas which require further work;

(f)  Work is also underway to establish how Contract management can be done more efficiently and effectively across the Council, ensuring proactive rather than reactive working practices, with a procurement pipeline enabling the Council to get upstream of any issues and identifying areas that the procurement team needed to be aware of; 

(g)  The contract management audit highlighted that systems currently in place are not reflective of best practice for contract management. New ways of working are being developed and implemented to ensure that best practice in contract management is established across all teams;

(h)  In recent years there has been a significant rise in the number of waivers of financial regulations to allow issuing of contracts without the full tender process taking place. A small number are for good reason, and could not have been avoided, however there are a large number that could have been avoided had best practice been in place. With the introduction of new working practices, there will be regular testing to ensure that best value for money is achieved. It will also ensure that suppliers do not get complacent and offer competitive pricing and good quality products/services;

(i)  Breaches of the Financial Regulations can result in comments by external auditors and qualifications being  ...  view the full minutes text for item 52