Decision Maker: Cabinet

Outcome: Decision approved

Is Key Decision?: Yes

Is Callable In?: Yes

Date of Decision: October 23, 2025

Purpose: This report seeks Cabinet approval to initiate a five-year vehicle procurement programme, through a series of tenders valued at up to £25 million. This investment will directly support the delivery of Newham’s Air Quality Action Plan (AQAP) and ensure the Council’s fleet remains compliant with the legal requirements of the London Ultra Low Emission Zone (ULEZ).   In the next 5 years, 320 currently leased vehicles have been identified for replacement. However, following a detailed review with service departments, an additional 180 hire vehicles can also be converted to lease, potentially delivering significant cost savings to the council of approx.: £5.7million. This report therefore requests delegated authority to award finance lease contracts for up to 500 vehicles, at an estimated cost to the council of £25million over the years 2025/30.

Content: For the reasons set out in this report and its appendices, Cabinet RESOLVED to Agree to:   i)  Approve the replacement of the vehicles set out at para 4.4.4 over a five year period at a maximum cost of £25 million, noting that where a needs analysis identifies a reduction in fleet numbers is appropriate, this will be implemented. ii)  Delegate authority to the Corporate Director of Environment & Sustainable Transport, in consultation with the Corporate Director of Resources and Cabinet Member for Environment, to: ·  Make all decisions and enter into all contracts and documentation required to give effect to the decision at 2.1 in line with the replacement strategy set out in this report. Final lease agreements will be subject to the budget available and may vary depending on market conditions at the time of award.   Alternatives considered   a)  Option1: Extension of Existing Lease Agreements One option considered was to extend the lease agreements for the current council fleet. However, this approach carries a financial risk, as many of the vehicles will be out of warranty beyond the fifth year. Any repairs required would therefore be at the Council’s expense, whereas under new lease 10 agreements, the Council would only be liable for costs associated with fair wear and tear. While this option may appear economically viable in the short term, the long-term maintenance liabilities make it less favourable. b)  Option 2: Do Nothing Maintaining the status quo was considered. However, the current council fleet—acquired as part of the in-sourcing of Street Cleansing services—was originally composed of second-hand vehicles. Since 2022/23, the cost of repairs and maintenance has increased by approximately 130% year-on-year, making this option financially unsustainable and operationally inefficient. c)  Option 3: Replace Fleet with Hired Vehicles Another alternative was to replace the existing fleet with hired vehicles. While this would ensure compliance with emissions standards, it would result in significantly higher costs—estimated at 25% to 50% more than the proposed leasing option. This approach would also not provide the same long-term value or operational control. d)  Option 4: Full Replacement with Electric Vehicles A full transition to electric vehicles was also considered. However, this option was deemed unfeasible at this stage due to the lack of sufficient charging infrastructure at the Central Depot and the substantial upfront capital investment required. This remains a longer-term ambition, to be revisited as part of the Council’s depot redevelopment and infrastructure planning over the next 5 years.