Agenda item

(To receive a report from the Executive Director - Commercial, which seeks approval for the entering into of a contract extension with Serco for a period of two years, with effect from 1 April 2022 to 31 March 2024.

Please note: Appendix One to this report has not been circulated to the press and public on the grounds that it is considered to contain exempt information as defined in paragraph 3 of part 1 of Schedule 12A of the Local Government Act 1972, as amended. The press and public may be excluded from the meeting if the Executive wish to discuss any of the information included within this appendix)

(1)  That approval be given to the entering into of a contract extension with Serco for a period of two years, with effect from 1 April 2022 to 31 March 2024 to include the following services:

·         Information Management Technology;

·         Payroll;

·         HR Administration;

·         Customer Service Centre (CSC);

·         Exchequer Services and Adult Care Finance.

(2)  That the Executive Director – Commercial, in consultation with the Leader of the Council, be delegated the authority to determine the final terms of the extension and approve the form and the entering into of all contractual and other documentation necessary to give effect to the said extension.

Consideration was given to a report by the Assistant Director – Commercial, which set out the results of a review on the possible commissioning approaches for the contract for corporate support services and sought approval for a further two year extension to the contract.   

The review on possible alternative commissioning approaches to the existing contract had considered value for money, delivered by the existing provider, Serco; and the extent of the market.  The review found that Serco had been delivering good performance: for example, Serco had only missed four of the 720 performance measures in the last eighteen months.

The review also found that there were no commercial providers undertaking the same mix of services to the public sector as those provided by Serco.  The IT market had evolved since 2018 into a multi-source model, with separate IT providers specialising in elements of IT services, which was the Council's preferred model.  A two year extension to the contract would support the Council's evolution to the multi-source model. 

Serco had also offered a series of value for money savings, totalling £5 million from 1 April 2020 – 31 March 2024 and had also worked in partnership with the County Council in response to the covid-19 pandemic, enabling circa 5,000 employees to work from home and establishing a community support advice line within two days of being requested to do so. 

For all of these reasons, the report recommended a further extension to the contract as the best means of delivering corporate support services and the Executive was further informed that the option to extend the Council's corporate support services contract with Serco for a further two years up until the 31 March 2024 had to be exercised by June 2020.

The Chairman of the Overview and Scrutiny Management Board presented the comments of the Board, which had unanimously supported the recommendations.   The comments included a reference to budget being based on the predicted volumes of activity, whilst the contract charges would be based on the actual volumes of activity, although it was expected that the existing budget provision would be sufficient.  The Executive supported the views of the Board.

The Executive considered the report and during the discussion the following points were noted:

• Verbal assurance had been given by Serco that none of the Lincolnshire staff would be redeployed to support the NHS's Test, Track and Trace programme.
• Assurance was given on the financial stability of Serco, following a due diligence exercise.
• The Council would address over the coming twelve months the issue of obsolete equipment and a report would be submitted within three months, updating on progress.
• The current Lagan customer relationship management system was outdated and required upgrading or replacing.  Serco had offered to upgrade the system to a later version of Lagan at its own cost, which would provide improvements in customer insight for the Council and help the customer service staff provide a better service.  The Council would undertake analysis over the next two months to verify if a Lagan upgrade was the right technical solution for the Council.  This would be resolved within two to three months and the position reached would form part of the update report on obsolete equipment.  

RESOLVED

(1)  That approval be given to the entering into of a contract extension with Serco for a period of two years, with effect from 1 April 2022 to 31 March 2024 to include the following services:

·         Information Management Technology;

·         Payroll;

·         HR Administration;

·         Customer Service Centre (CSC);

·         Exchequer Services and Adult Care Finance.

(2)  That the Executive Director – Commercial, in consultation with the Leader of the Council, be delegated the authority to determine the final terms of the extension and approve the form and the entering into of all contractual and other documentation necessary to give effect to the said extension.