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Agenda item

Agenda item

Procurement Management Information

The purpose of the report is to provide evidence to allow the committee to evaluate the extent that Portsmouth City Council is producing contracts for goods, works and services in a legally compliant value for money basis.

 

The report is for noting.

Minutes:

(TAKE IN REPORT)

 

Richard Lock (RL), Procurement Manager, introduced the report which provided evidence to allow the committee to evaluate the extent that Portsmouth City Council was producing contracts for goods, works and services in a legally compliant value for money basis.

 

The report provided comparison between performance from the last time period reported to the committee on 5 March 2021, which covered November 2020 - January 2021, to the latest reporting period February - June 2021.

 

Unfortunately due to the upgrading of the Council's finance system to the Oracle cloud based FUSION system putting pressure on day to day operational support the spend compliance report could not be effectively produced in time for the GAS Committee document pack issue deadline. However, subsequent to this the system issues which prevented the report being run has been resolved and a report had been successfully produced in advance of the actual GAS Committee meeting.

 

In respect of the spend compliance report which covers financial transactions linked to contract register entries in line with Local Government Transparency Code (2015) requirements, RL was pleased to inform the Committee that the raw compliance report figure for May 21 had risen to 92% from the 71% reported for December 2020, which is the highest it has ever been. Further analysis to remove administrative errors and oversights increased the adjusted compliance figure to 99% which is again the highest this has ever been since these reports were first taken to the Committee.

 

RL informed the committee that this sharp positive increase was due to the increased contract to financial transaction matching controls introduced with the upgrade to Oracle FUSION combined with a focused sustained effort by Procurement to work with services to improve the completeness and accuracy of the Council's contracts register. RL said that a copy of the detailed excel report can be provided to the committee upon request.

 

In respect of the Appendix 2 report which covers waivers granted to depart full compliance with the Council's Contract Procedure Rules and on some occasions the wider Public Contracts Regulations (2015) RL provided the committee with an overview of the report which showed that pressures of the pandemic and Brexit were still significantly contributing to an increased level of contracts that have been direct awarded via waiver in order to meet operational requirements. It also appeared that following the implementation of Oracle FUSION there was now higher visibility of below £100k contracts which could be directly awarded by relevant Director without seeking further approval from Procurement and Legal which was also increasing the level of waivers reported.

 

In respect of the Appendix 3 report which covered contract performance against corporate KPIs. RL provided an overview of the two contracts which were showing as red but were not of any ongoing significant concern due to improvements of performance in the case of the waste contract and recovery of costs in respect of the IT hardware contract. No questions were raised by Committee in respect of the red contracts. However concern was raised in respect of the value and number of contracts against which no level of performance had been recorded.

 

RL acknowledged the concerns and would target making improvements in this area for when the next procurement report weas considered by the committee.

 

RL stated that for some contracts, works construction contracts as example, the KPI was not recorded until completion of the works which could result in high 'KPI yet to be scored' figures. RL also stated that in addition to general KPI reporting additional contract delivery assurance was also provided by the Strategic Contract Support Board which he sat on and that there were no significant contracts with unaddressed issues.

 

The committee raised questions regarding the supplier performance on the Education Management System contract which is at amber and appeared to be of high value. RL answered that the value of £642,080 stated was a cumulative rather than per annum value and covers a period running from 1st April 2013 to the current expiry date of 31st March 2022. RL also confirmed that he was aware that a capital bid had been approved to replace the current system and that work was being undertaken to review options, including for re-tender of the contract which may entail a switch of supplier.

 

The committee enquired whether a switch of supplier and associated system could be put in place now. RL answered that due to significant staff costs associated with switching systems along with first year capital purchase costs that entering into a short term arrangement would be unlikely to represent best value for the Council.

 

The committee asked that options for bringing forward the long-term review and development / replacement of the system should be investigated by the service.

 

RESOLVED that the committee NOTED the update report.

Supporting documents: