Procurement Strategy 2009/12

Report: 15
Date: 18 June 2009
By: the Treasurer and Director of Resources on behalf of the Commissioner

Summary

Following member approval on 16 January 2009 to the key sections of the Procurement Strategy, a revised strategy for the period 2009/12 has now been developed and is attached at Appendix 1. The strategy along with Members’ comments is to be considered by Finance and Resources Committee on 15 June 2009.

A. Recommendations

That:

1. The Finance and Resources Committee approves the Procurement Strategy including the various procurement models and subject to any comments submitted from the Resources Sub- Committee; and
2. Members agree that an action plan should be brought back to Resources Sub Committee in September detailing how the Procurement Strategy will be implemented over the three year period.

B. Supporting information

1. The Authority first approved the joint MPA/MPS Procurement Strategy in December 2003, this was subsequently revised and updated in 2007. However during last year’s review of Contract Regulations it was agreed that the existing strategy should be reviewed to ensure that amongst other things:-

1. The linkages between the Contract Regulations and the Procurement Strategy are clear
2. The Strategy included the permitted procurement models, in order to better reflect the environment in which the MPS has to procure both now and in the future
3. The separate roles and responsibilities of the Authority and Service were made more explicit.

2. Based on the Chartered Institute of Public Finance and Accountancy (CIPFA) guidance for developing a Procurement Strategy, the revised version has been drafted jointly by MPA and MPS officers in consultation with Members, MPS business groups and Senior Management both within the Authority and Service.

3. Covering the period 2009-2012, the revised strategy details objectives for the three year period, the principles underpinning these and the key actions needed to ensure these are delivered by 2012. Roles and responsibilities have been made more explicit, not only defining the role of MPS procurement services in delivering the strategy but also the role of both the Authority and Business Groups.

4. There has in the past been a lack of clarity about the procurement models that the Authority would find acceptable and the circumstances under which they could be used. Therefore the strategy now includes a section specifically on the various procurement models that the Service may use when procuring goods and services. It is important that members are content with these as approval of the strategy is intended to also represent approval to use the various models in the future. Therefore a summary of each of the proposed models and the circumstances under which they may be appropriate is provided below.

Procurement Models

5. The scale of the MPS and the environment in which it has to procure necessitates a variety of procurement models to be available for use, depending on the nature of the requirement and the desired outcome. A key part of the procurement methodology is to determine the category strategy, according to spend and market characteristics, and determining the most appropriate procurement model is an important component, as often more than one model could be used. The revised strategy includes the procurement models most frequently used by the MPS and gives some indication of when they might be appropriate. The intention is that all the procurement models listed are agreed by the Authority as permissible options. In summary these are: -

• Strategic Partnership Agreements - Considered for high expenditure and strategically important purchases e.g. Capgemini ICT agreement;
• Long-term Agreements - Considered where suppliers may be required to make substantial initial investments and require a longer period to get a return on their investment. The transport outsource agreement is a 10-year agreement.
• Collaborative Agreements - Considered where the aggregation of spend would be more beneficial than contracting alone. Particularly relevant in driving greater efficiency savings with other police forces, the GLA Group and other agencies e.g. collaborative agreement with OGC & MoD on stationery, print consumables, etc.
• Framework Agreements - Considered where you have regular requirements and in the interests of cost and time you do not wish to formally tender every single requirement e.g. interim staff. The framework itself is tendered via OJEU and each call-off is run as a mini-competition among all the suppliers who are capable of meeting your requirements.
• Two-stage Tendering - Considered for high value construction projects where it is beneficial to have the design team and the main contractor work closely together.
• Competitive Dialogue - Considered for the award of complex procurements, where the technical requirements are not easily specified at the outset and the market can offer a variety of different technical solutions e.g. THR. Use of this is likely to be limited

6. A detailed action plan will be produced to support the high level actions identified in the strategy, and will be presented to Resources Sub Committee for approval in September with progress subsequently monitored by Resources Sub Committee on a quarterly basis.

C. Race and equality impact

In line with the GLA responsible procurement policy the Authority and Service will continue to promote and implement responsible procurement.

D. Financial implications

There are no direct financial implications associated with this report.

E. Background papers

• Update on Procurement Strategy, Resources Sub-committee, 16 January 2009.

F. Contact details

Report author: Annabel Adams and Anthony Doyle

For more information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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