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RESOLVED: that
Cabinet:
a)   
Approved the procurement of contracts for security
services.
 
REASONS RESOLVED:
·        
To ensure that the Council complies with statutory
and regulatory duties.
·        
To ensure as far as practicable that Council
properties provide a safe environment for staff and other
users.
·        
To maximise cost-effectiveness.
·        
To minimise opportunities for damage of Council
assets.
 
ALTERNATIVE ACTIONS:
The Council has a range of
options in the provision of these services. As the Council’s
approach to sourcing develops it may be appropriate to make other
proposals. However, at present there is a need to promptly secure
re-provision of services and in that context the approach set out
above is recommended. Options which could be considered include the
following:
 
Option 1: Insourcing of the
service. Insourcing decisions are often made to obtain control of a
critical production or competency; conversely outsourcing decisions
are often made to reduce ‘non-core’ in-house operations
and to reduce some costs, typically by taking advantage of
specialist providers, the ability of supplies to aggregate demand
and thus produce economies of scale, competitive market forces, and
by reducing employment costs. Insourcing can make sense in some
cases, notably where the Council has sufficient demand to sustain a
level of staffing and expertise in the services in question, and
when quality of outsourced provision hard to control. However, the
existing contracts for these services have generally operated well
and it may be challenging to provide the same quality or
reliability of service in-house.
 
Option 2: Disaggregation of the
contracts into small lots. The current procurement strategy relies
on aggregating all specific service contracts requirements into
single contracts with single specialist suppliers for each field.
This is in order to attract the greatest commercial interest from
the market and obtain additional value and/or reduce cost through
efficiency of scale and minimise the administrative burden on the
Council. This approach has previously attracted significant market
interest and has provided competitive rates. A disaggregation
across sites or areas would increase the time and processes
requirement for administration of the contracts and is likely to
increase the contract costs too, particularly for small remote
sites.
 
Aggregation of the contracts
into one or a small number of multi-service contracts. To deliver
such an aggregated service is likely to require the principal
provider to let a number of sub-contracts for specialisms. This
would involve additional costs in the overall supplier managing the
sub-suppliers. It would also limit opportunities for small and
medium businesses (‘SMEs’) to participate.
 
Option 4: Use of a
Council-owned or jointly-owned entity (e.g. West Northamptonshire
Norse Limited). These are traditionally known as Teckal companies,
after the ECJ case which decided the exemption in public
procurement law which allows direct awards to entities controlled
by a body such as the Council. This falls somewhere between the
insourcing and outsourcing options, having benefits such as
potential for profit generations from third parties, but without
the competitive pressure of a procurement. It would take time and
staff resource the Council does not currently have to pursue this
approach at this time. As with in-house provision, it may be
challenging to provide the same quality or reliability of
service.
 
Option 5: Aggregation of demand
across the Council’s sites whilst providing lots for specific
types of service. As outlined above, this would enable specialist
suppliers to bid, without the overheads which come from having a
large entity seeking to co-ordinate the units actually providing
services. The division into specialist areas would also increase
the potential for bids from small and medium businesses
(‘SMEs’) and local suppliers.
 
Overall, Option 5 is the
recommended way of proceeding. It is considered to be likely to
optimise the response from the market and maximise the
opportunities for social value from the procurement.