Agenda item

Report of Corporate Director for Finance and Resources

This item does not contain any decisions that are eligible for call-in.

Steve Oakley, Head of Procurement, presented the report detailing the outcomes and achievements delivered under the Procurement Strategy 2018 - 2023 during its fifth year (2022-23, as detailed in appendix 1) and over the five years of 2018-23 (as detailed in appendix 2).  He highlighted the following information:

a)  over the five years of the Strategy 2018 - 2023, a total of £804m has been invested in the local economy – an average of 56.52% of total contract value awarded to City suppliers against a target of 60%.  In total, 79% was awarded to East Midlands suppliers with 433 new entry level jobs and apprenticeships created.  This is a good achievement;

b)  in 2022 - 2023 £104.4m was invested in the local economy, which was 39.19% of total contract value awarded to City suppliers.  This was lower than the target for local spend due to the nature of the contracts awarded during the year, for example the new agency contract worth £30m;

c)  in 2022 – 2023 the number of new jobs created was slightly lower than anticipated due to the types of contract that were awarded which didn’t enable many new entry level jobs;

d)  a new Strategy is in development to start in January 2024.

During discussion and in response to questions from Committee members the following points were made:

e)  compared with other similar local authorities, the Council is at the front of recording local spend.  Most local authorities who have articulated it are aiming for 50-60% local spend but tend to be less focused on it as an issue than Nottingham City Council;

f)  work is taking place at a regional level to look at social value and work is also happening with other contracting authorities such as Nottinghamshire Police and the NHS.  One of the challenges is that organisations have different measures so there is a need to identify key priorities that can be worked on together;

g)  local spend is more likely to enable local accountability for provision;

h)  using suppliers geographically closer to Nottingham supports CN28 objectives;

i)  it isn’t possible to stipulate that suppliers have to be local but the benefits of being local can be included in scoring.  However, it has to be recognised that sometimes it is cheaper and more cost-effective to use non-local suppliers;

j)  it is anticipated that the first draft of the new Strategy will be ready by autumn 2023.  It won’t be dissimilar to the current Strategy but there will be some new areas of focus.  There could be scope to do more from an environmental perspective and assessing wider contract outcomes, not just procurement outcomes.

Resolved to note:

(1)  the outcomes delivered under the Nottingham City Council Procurement Strategy 2018 - 2023 in its fifth year (2023), as detailed in appendix 1;

(2)  the outcomes delivered during the five years of the Procurement Strategy 2018 - 2023, as detailed at appendix 2;

(3)  that the Nottingham City Council Procurement Plan has been refreshed during 2022-23 as part of the procurement transformation programme; and

(4)  that the new format of Procurement Pipeline report is reported routinely under the new operating model for procurement in the Commercial, Procurement and Contract Management Division.

Reasons for recommendations

The Procurement Strategy 2018 - 2023 provides a framework for the procurement of all goods, works and services to support the delivery of the Council’s strategic priorities within a challenging financial context. It sets out how procurement will use the Council’s spending power to pursue our key objectives of citizens at the heart; securing economic, social and environmental benefits; and commercial efficiency. Delivering the Council’s strategic priorities requires the efficient, strategic use of its purchasing power, and the Strategy promotes a commercial approach to support the Council in addressing significant financial challenges now and in the longer term.

The Strategy drives the delivery of social value for the City by addressing economic, social and environmental considerations at all stages of the procurement cycle, through the framework of the Public Services (Social Value) Act 2012. It sets out key actions to be taken to maximise the economic, social and environmental benefits secured through all the Council’s purchasing activity.

Delivery under the Strategy in 2022-23 continued under the core principles of:

·  Commercial efficiency;

·  Citizens at the heart;

·  Partnerships and collaboration;

·  Governance, fairness and transparency;

·  Ethical standards;

·  Innovation and improvement.

Other options considered

None.  Progress against the Strategy is reported to the Committee on a yearly basis.