Agenda item

(To receive a report from Paul Rusted, Infrastructure Commissioner, which describes the actions that will be required to ensure appropriate arrangements are in place to provide service delivery continuity when the three contracts that form part of the Lincolnshire Highways Alliance reach their full term by 31 March 2020)

It was reported that the three contracts which formed the Lincolnshire Highways Alliance (LHA) began on 1 April 2010 and were due to reach full term on 31 March 2020 following the award of the final extension.  The three contracts were the Highways Works Term Contract, the Traffic Signals Term Contract and the Professional Services Contract.

Members were guided through the content of the report, and were provided with the opportunity to ask questions to the officers present in relation to the information contained within the report and some of the points raised included the following:

·         It was queried why these arrangements had suited Lincolnshire better as other authorities who had entered into these arrangements had not been as successful.  Members were advised that the LHA had regularly been a part of the scrutiny process which had brought issues out into the open and had also brought senior officers from each of the contractors into the Committee.  It was also reported that the authority had been very active at making sure that standards were maintained.  It was also noted that the authority had been very lucky to be able to retain its Highways Laboratory.  Members were informed that trips would be offered to the lab as part of the process of determining a replacement for the Highways alliance contract.

·         In order for contracts such as the Highways Alliance to be a success, there was a need to constantly strive to improve.

·         It was commented that there would be a need for members to have knowledge of the contracting process, as it would be important to show that there was an understanding of what was being scrutinised.  Members were advised that there was an expectation that this would be a regular paper to the scrutiny committee which would help members to increase their knowledge of the issues.

·         The importance of in-house knowledge was emphasised, as if design work was outsourced, whilst a design would be technically correct, when looked at with local knowledge there could be an opportunity to do things slightly differently and save money.

·         It was queried whether there was any succession planning taking place to ensure that in house knowledge was retained.  Members were advised that there were a number of highly skilled people who would be retiring in a couple of years.  However, apprenticeship schemes with career grades had been introduced to try and mitigate this.

·         Members were advised that there was a plan in place, but it was acknowledged that there was a difficulty in attracting experienced professionals to Lincolnshire.  There was support from the university and HND programmes.  It was commented that sometimes it was better to 'grow your own' in terms of skilled staff.

·         It was clarified that the working group which it was proposed to set up would be separate to the scrutiny panels and only 3-4 members would be involved and the working group would bring regular reported back to this Committee to ensure that it was kept up to date on the direction and the options being considered.

·         It was reported that by Christmas, there would be a need to have made a decision regarding the direction of travel.

·         It was suggested that the working group should be made up of the Chairman and Vice-Chairman of the Scrutiny Committee and the portfolio holder for highways, transport and IT.  It was further suggested that an additional member should be included who may not have as much experience in terms of highways matters in order to provide a different viewpoint.

·         In terms of an options appraisal and a cost benefit point of view, with a single provider it was queried whether there would be a danger of a lack of competition, and how long it would be before performance could be reviewed.  It was reported that a desirable length of contract was about 7 years, mainly due to the value and lifespan of assets (e.g. vehicles) which would be purchased.

·         In relation to the potential impact of Brexit on short, medium and long term schemes, it was noted that the movements of the pound had impacted on steel prices.  It was also noted that the authority had employed a number of skilled staff from the EU. 

·         In relation to suppliers and the procurement process the aim was the cheapest price at the right quality.  It was noted that a lot of companies where national rather than local, and it was queried whether there was a way to encourage Lincolnshire firms to bid for these contracts.  Members were advised that the authority did have some existing framework agreements with medium sized local companies.  It was also noted that many of the staff who work for the national companies, such as Kier, actually lived locally.

·         It was commented that using local companies should always be competitive, as there would be fewer travelling costs.

·         It was suggested whether it should be included in the options appraisal that local businesses should be used.

·         Officers and members would be visiting some authorities which still had DLO's.  However, they would need to be set up very differently to how they were in the past if they were to be competitive.

·         Current contracts had open book accounting, so officers were able to see how contractors were spending their money.  It was noted that some staff were paid more than the county council equivalent.

·         Members were informed that it could be difficult to get some companies to tender for work, and it was important to create the right contract in order to invite the right competition.  It was noted that some authorities were finding it very difficult to get the right bidders.

·         It was confirmed that the authority was open to invitations to tender and that select list tenders disappeared from this authority a long time ago.

RESOLVED

1.    That the Committee support the suggested next steps as outlined in the report, including the setting up of a Steering Group to include the following – Councillors M Brookes, C J T H Brewis, R G Davies and S P Roe.

2.    That additional priorities for officers to consider as part of the contract development process include

·         Encouraging the use of local businesses

·         The impact of Brexit to be kept in mind as discussions progress