Minutes - draft

These minutes are agreed.

Minutes of the meeting of the Finance and Resources Committee held on 20 October 2011 at 10 Dean Farrar Street, London, SW1H 0NY.

Present

Members

• Dee Doocey (Chair)
• Reshard Auladin
• John Biggs
• Faith Boardman
• Christopher Boothman
• Steve O’Connell
• Amanda Sater
• Valerie Shawcross
• Graham Speed

MPA officers

• Bob Atkins (Treasurer)
• Catherine Crawford (Chief Executive)
• John Crompton (Treasury Team)

MPS officers

• Jane Bond (Director of Property Services)
• Bill Egan (Procurement Manager)
• Dick French (Head of Fleet Management)
• Anne McMeel (Director of Resources)
• Nick Rogers (Director of Finance Services)
• Alison Spackman (Property Services Programme Manager)
• David Woosey (Director of Supply Chain Management)

Phiroza Katrak, Client Director, Arlingclose attended for consideration of agenda item 6.

50. Apologies for absence

(Agenda item 1)

There were no apologies for absence

51. Declarations of interests

(Agenda item 2)

No declarations were made.

52. Minutes of the meeting held on 22 September 2011 (Part 1)

(Agenda item 3)

Resolved – That the minutes of the meeting of the Committee held on 22 September 2011 be agreed and signed as a correct record.

Arising-
A briefing note which provided the response to the areas where members had sought more information at previous meetings was tabled at the meeting.
The Director of Resources apologised for the fact that it had only been possible to forward the information requested at the September meeting on the previous day which had meant that it was received by members much later than she would like.
The Chair said that the Committee would receive the tabled briefing paper, but members still had the opportunity to comment on it or to request that it be considered again at the next meeting. For the future, it would be helpful if these briefings could be circulated in a more timely fashion.
In response to a point raised with regard to the item in the briefing concerning the Vehicles Fraud Unit, the Director of Resources undertook to provide further information on the impact which the migration to a national service under the aegis of ACPO had brought about..

ACTIONS
1. Further briefing to be provided on the impact of the migration to a national service in respect of vehicle fraud.
MPS

53. Revenue budget monitoring 2011/12 – period 5

(Agenda item 4)

This report showed the revenue and capital position at Period 5 (August 2011). The revenue budget is forecast to overspend by £2.1m (0.1% of budget) before any account is taken of the budget resilience provision or the costs of Operations Kirkin and Withern. The capital programme as at the end of period 5 shows year to date expenditure of £63.2m. This represents 33.9% of the annual programme budget of £186.3m.
A member referred to paragraphs 43 and 44 – concerning the vacancies within the specialist business groups and asked what factors might prevent the targets from being reached. The targets appeared to be largely dependent upon the success of the transferee scheme and the target for Special Constables being achieved.

In reply the Director of Resources reminded the Committee that as far as officer numbers are concerned the current published plan over the next 3 years showed a slightly downward trajectory but there had been a pause on recruitment last year which had meant that the MPS had dropped below what would be expected in terms of planned strength. The expectation was that there would be a good take up of the transferee scheme due in part to the effects of the expenditure reductions on neighbouring constabularies which would typically lead to a reduction in internal promotion opportunities. This would be especially helpful in dealing with some current senior skills shortages within the MPS with applications being sought either at the same grade or on promotion. There was a rigorous process in place to match the applicant with the skills requirement .

It was accepted that the target for Special Constables was always going to be challenging, but there were encouraging signs regarding recruitment, and indeed it was an interesting fact that enquiries had increased following the disturbances in August. The recruitment process tended to identify two distinct cohorts –those who were looking to join as a Special as route to becoming a Constable and those who were clear that they saw being a Special as a way of carrying out a useful voluntary activity but did not envisage this being a long term commitment. The Director also referred to the possible risks on the patterns and levels of recruitment in terms of training centre capacity.

A member said it was gratifying to see that his perception from visits (to, for example the Transport OCU) was that members of the MSC were now more closely involved in mainstream policing activity than had sometimes been the case in the past.

Graham Speed, Chair of the Estate Panel, said he had some concerns about what was being said in paragraph 51 about the role of the Borough Commanders in relation to Safer Neighbourhood Property Programme. The Estate Panel was due to discuss a draft report on the Safer Neighbourhood Property Programme at its meeting later that day and he would explore these concerns further then.

A member referred to paragraph 54 which discussed catering modernisation. He noted that there had been a slippage in the introduction of a cashless/electronic point of sale facility and wondered if this project might be in danger of being too complicated in relation to the perceived benefits it would bring. He would welcome a briefing on the IT aspects following the meeting. It would also be useful to have something on the outcome of the modernisation project and specifically whether it had been possible to ascertain whether there had been any permanent loss of customers who may have been inconvenienced by the closure of a facility whilst it was being modernised.

In reply to a question concerning the deployment plan in the context of the medium term financial plan, the Director of Resources said that whilst a forward deployment was published it was subject to annual review with reference to the prevailing t financial landscape and the need to identify further savings as reflected in the medium term financial plan.

Members also enquired what was meant by the term “management intervention” in relation to the overspend on overtime in Territorial Policing which was referred to in paragraph 60. In reply the Director of Resources confirmed that management intervened on the control of overtime on a continuing basis. Apart from operations Kirkin & Withern, the forecast overspend is largely due to policing the Royal Wedding and Operation Fieldgate the (Embassy protests). Whilst it is now considered unlikely that Territorial Policing would be able to recover the total overspend, management would continue to intervene to reduce the overspend by as much as possible.

Resolved – That the year to date and forecast position for the revenue and capital budgets be noted.

ACTIONS
2. Briefing to be provided on the project to introduce a cashless/electronic point of sale facility to canteens and on the outcome of the catering modernisation programme .
MPS

54. Second review of the capital programme 2011/12

(Agenda item 5)

This report provided details of the second review of the capital programme 2011/12.
The first revision of the capital programme 2011/12 was approved by the Committee at its meeting on 21 July 2011. The purpose of the second review is to ensure that budgets were suitably adjusted to reflect known and material changes to project profiles and recent agreements from ACPO TAM. The report also highlighted the revised funding mix and profile.

The Chair observed that the amount of expenditure appeared to be very similar to last year.

Resolved – That

1. Approval be given to the revised capital programme 2011/12 of £205.2m gross and budget of £187.0m, reflecting the latest view of projects in progress, the proposals for new starts and the management of over programming. (Appendix 1 refers.)
2. Approval also be given to the revised funding proposals (paragraph 9 and Appendix 2 refers)

55. Banking and RBS update

(Agenda item 6)

This report provided members with an update on the banking sector following some recent revised ratings awarded by the rating agencies which had meant that there had been some revisions to the approved investment counterparty list. The report also contained additional information relating to the Royal Bank of Scotland (RBS) which is the MPA banker.

Phiroza Katrak from Arlingclose attended for consideration of this item. She stressed that the downgrading did not denote that there been a deterioration in the underlying strength of the UK banking sector, but rather it reflected the perceived shift in support from the Government in the future. She went on to advise that there was a general expectation that there may well be further instances of the agencies downgrading the ratings both of sovereign states and of individual banks both in the UK and elsewhere. Phiroza Katrak also referred to the other aspect of the report concerning the Royal Bank of Scotland and stated that Arlingclose was content with regard to the MPA’s ongoing use of RBS for its day to day banking operations.

Graham Speed said that the developments outlined in the report were manageable under the adopted Strategy by removing parties from the counter party list, and notwithstanding these recent developments he felt that the approach to risk taken by the MPA in its Treasury Management strategy continued to be appropriate.

Resolved – That

1. The report and amendments to the investment counterparty list be noted;
   Approval be given to the continued use of the Royal Bank of Scotland for temporary overnight balances and for Proceeds of Crime Act (POCA), other detained funds and Police Property Act Fund (PPAF) monies.

56. The Government procurement service framework agreement for office supplies

(Agenda item 7)

This report sought the approval of members to place call-off contracts for the supply of Office Consumables for a period of four years, under a framework let by the Government Procurement Service for Lot 1 of a framework agreement relating to the provision of office stationery, office paper and small office machines. The framework agreement will be effective from 1 October 2011 with the total estimated expenditure for this Lot and a separate Lot is £8.8m. The report advised that the contract for this separate Lot 2 (printer consumables ) had been placed by the MPS Contracts Board under delegated authority.
Members sought assurances that the agreement would provide value for money and would address the sort of issues which had been raised at the recent Commissioner’s Conference.
The Chair advised that she had been supplied with a copy of the full fixed price list for core items. She suggested that the recommendations be adopted subject to any points being addressed when she had the opportunity to consider the information which had been provided.

Resolved – That

1. Approval be given to the use of the framework agreement and the placing of a call-off contract with the successful bidder for Lot 1. This call-off contract is for three years with an option to extend for one further term of 12 months and the total four year value for this lot is estimated to be £5.45m.
2. It be noted that the Contracts Board, under delegated authority, on 27 September 2011 approved the use of the Framework Agreement and the placing of a call-off contract with the successful bidder for Lot 2. This call-off contract is for two years with an option to extend for two further terms of 12 months. The anticipated four year value for this lot is estimated to be £3.35m.

57. Award of contract for the provision of coach services for the Olympic and Paralympic Games

(Agenda item 8)

This report described the outcome of the procurement process undertaken between the MPS and the supplier under the current MPS Framework Agreement to secure the supply of coach services for the 2012 Olympic and Paralympic Games. It recommended the award of a contract award to the supplier for a maximum value of £9.399m.

The Chair advised that the subject matter of this contract had been examined in considerable detail by the Olympic and Paralympic Sub-Committee and there were no outstanding financial issues.

Resolved – That

Approval be given to the award of a contract to the supplier under the existing MPS Framework Agreement for the provision of coach services for the 2012 Olympic and Paralympic Games, for a total maximum value of £9.399m;

It be noted that the total maximum contract value includes expenditure of £8.033m to provide a dedicated coach pool and management/engineering services, and to cover additional coach journeys for mutual aid officers travelling from their home force area to the host force area which fall outside of the coach pool provision; and .
It be noted that because of the continuing uncertainty surrounding the ultimate volume of requirements, particularly arising from the present on-going review of recent public order events, a 17% budget contingency has been added to the arrangements to allow for potential increased demand; thereby increasing the potential value from £8.033m to £9.399m.

58. Routine Contracts Programme

(Agenda item 9)

This report set out the latest version of the Routine Contracts Programme, providing members with detail on the contracts above £1m that the MPS wishes to let over the next twelve months on a rolling programme, and the details of those contracts let since the last report.

Members indicated that whilst it was encouraging to see that the schedule of the contracts which had been let was now included in the public part of the agenda it was questionable whether there was sufficient information provided to enable those reading the report to put what in isolation often seemed like very large sums into context. For example, the length of the contract would be helpful. Further information was requested in respect of the following items which appeared in the Appendix:

Supply of Project Management Consultancy for delivery of proposed Safer Transport Command Operational Model;
Bridge Lodge Bothy, Balmoral, Oil Storage Works;
Supply and Delivery of neckwear; and
Professional Services for Hendon New Build

The Director of Resources advised that she was in a position to provide a detailed response in the case of all these items apart from that relating to neckwear as the Chair had already asked to be briefed on these items The Director then read out the responses which had supplied earlier. This information is included as an Appendix to the minutes. The Director confirmed that information would be supplied on the period of the neckwear contract,

Resolved – That

1. the report be noted; and
2. approval be given to the latest version of the Routine Contracts Programme and to the authorisation to place OJEU advertisements where appropriate.

ACTIONS
3. Information to be provided on the life of the neckwear contract.
MPS

59. Disposal of Finchley section house

(Agenda item 10)

This report requested the approval of members to dispose of the freehold interest in Finchley Section House, Amberden Avenue, Finchley following an open market tender.

Resolved – That

1. Approval be given to the disposal of the freehold interest in Finchley Section House at the value and to the bidder identified in Exempt Appendix 3 following an open market tender;
2. It be noted that the disposal is consistent with the approval in principle decision made by the Committee on 16 December 2010, and
3. It be noted that the capital receipts from the disposal will support the 2011/12 Capital Programme.

60. Disposal of Westcome Park former police station Greenwich

(Agenda item 11)

This report requested the approval of members to dispose of the freehold interest in Westcombe Park former police station, 11-13 Combedale Avenue, SE10 0LQ following an open market tender.

In introducing the report the Director of Property Services said she could provide an assurance that the recommended bid represented the best price which could be obtained.

Steve O’Connell, the MPA link member for Greenwich, confirmed that he had been briefed on the matter and that both he and the Borough Commander fully supported the proposal.

The Chair said that she had requested that in future link members be advised of all proposals affecting the estate in their borough –i.e., to include disposals (including residential units), front counter closures or transfers and proposals affecting Safer Neighbourhood offices and that their views be included in the reports submitted to the Committee.

Members asked whether given the general state of the property market it might be better to delay making some of the disposals in the current schedule until a time when a better price might be obtained. In reply the Director of Property Services advised that professional advice was received at all stages of the process and that overall the disposals programme was currently on target in terms of income. With regard to individual properties within the programme, the timing of the disposal had to be considered in the round –i.e. any (hypothetical) increase in the anticipated value by deferring a disposal had to be considered in the context of the actual cost of holding the asset for a longer period and the associated vulnerabilities in the case of empty properties.

Resolved – That

1. Approval be given to the disposal of the freehold interest in Westcombe Park former police station at the value and to the bidder identified in Exempt Appendix 3 following an open market tender;
2. It be noted that the disposal is consistent with the approval in principle decision made by the Committee on 16 December 2010, and
3. It be noted that the capital receipts from the disposal will support the 2011/12 Capital Programme.

61. Disposal of Rennetts Wood House

(Agenda item 12)

This report requested the approval of members to dispose of the long leasehold interest in flats 1-12 Rennet’s Wood House, Bexley Road, Greenwich following an open market tender.

Resolved – That

1. Approval be given to the disposal of the freehold interest in Flats 1-12 Rennets Wood House at the value and to the bidder identified in Exempt Appendix 3 following an open market tender;
2.  It be noted that he disposal is consistent with the approval in principle decision made by the Committee on 16 December 2010, and
3.  It be noted that the capital receipts from the disposal will support the 2011/12 Capital Programme.

62. Any other urgent business

(Agenda item 13)

There was none.

63. Exclusion of press and public

(Agenda item 14)

Resolved – That under section 100A(4) of the Local Government Act 1972 the press and public be excluded from the meeting for the following items of business on the grounds that they involved disclosure of exempt information as detailed in paragraphs 3 and 4 of Schedule 12A to the above Act.

Summary of decisions made on exempt items

64. Procurement Strategy for the provision of Facilities Management services to maintain/repair the real estate portfolio

(Agenda item 15)

Recommendations relating to the proposed procurement strategy were agreed.

65. Metropolitan Police Athletics Association and Imber Court Sports Club

(Agenda item 16)

Recommendations relating to the proposed lease were adopted.

66. Exempt appendix to capital and revenue budget 2011/12

(Agenda item 17)

Information noted.

67. Exempt appendices to the Government Procurement Service Framework Agreement for office supplies

(Agenda item 18)

Information noted.

68. Exempt appendix to award of a contract for the provision of coach services for the Olympic and Paralympic Games

(Agenda item 19)

Information noted.

69. Exempt appendix to Routine Contracts Programme

(Agenda item 20)

Information noted.

70. Exempt appendices to disposal of Finchley Section House

(Agenda item 21)

Information noted.

71. Exempt appendices to disposal of Westombe Park former police station Greenwich

(Agenda item 22)

Information noted.

72. Exempt appendices to disposal of Rennets Wood House

(Agenda item 23)

Information noted

73. Minutes of the meeting held on 21 July 2011 (part 2)

(Agenda item 24)

Agreed and signed as a correct record

Appendix to the minutes of the Finance and Resources Committee 20 October 2011

Agenda item 7 Routine Contracts programme –contracts which have been let

These are the detailed responses to the questions which had been asked concerning specific items in the Programme

(i) Supply of Project Management Consultancy for delivery of proposed Safer Transport Command Operational Model

As part of the wider approach to managing service delivery across the Metropolitan Police Service (MPS) through a time of budgetary pressure, the Safer Transport Command (STC) has been asked to deliver a programme which will result in a major organisational change in key areas of transport policing.

Part of this programme is the implementation of a proposed new STC operating model, which comprises the replacement of the Traffic Warden Service with Police Community Support Officers (PCSOs), the development of a new delivery structure for roads policing, the removal of a further 300 PCSOs from the current Safer Transport Team operating model and an increase in the overall police officer numbers by 413. This operating model must be in place in time to meet operational requirements for the 2012 Olympics. The STC change programme will link closely to work undertaken by the Territorial Policing Development Programme, which coordinates the wider MPS change programme.

For STC to effectively manage a change of this magnitude it is essential that a robust programme management structure is put in place throughout the phases of the programme. Provision of change management consultancy is therefore requested to support STC through this transition.

Previous experience and knowledge of business change specific to Traffic Management and transport policing will also be provided through this consultancy service. This approach is strongly supported by Transport for London both as primary funder of the Command and a key delivery partner.

Following a compliant procurement exercise, the contract was awarded to PA Consulting for a period of 6 months at £81,200 with the possibility of 2 further extensions of 6 months at £81,200 each, taking the total Contract value to a maximum of £243,600.

(ii) Bridge Lodge Bothy, Balmoral, Oil Storage Works

The premises provide accommodation for MPS officers whilst providing Protection duties during periods when members of the Royal Family are in residence.

The requirement was for the replacement of the internal fuel oil storage due to non-compliance with Water Environment (Oil Storage) Scotland Regulation 2006 and environmental improvements to energy controls.

A competitive tender action was run and the contract awarded to Camstruction Ltd, who unfortunately went into Administration before work was commenced, so this contract was terminated. An alternative contractor, Bancon Ltd., was identified who agreed to undertake the works for the same contract sum (£62,040.40) and a contract was therefore entered into with them as a single tender action.

(iii) Professional Services for Hendon New Build

In the context of the corporate real estate review of the entire Hendon Estate, this contract supports the need for the resulting provision of office and training facility on the remaining Hendon site to accommodate teams and business groups with representation at Hendon. A new facility will be required to provide 25,000m2 (gross) of accommodation.

This report recommends the award of a Design, Employer’s Agent, Project Management and Quantity Surveying Team. The initial deliverables are to understand accommodation requirements of the teams located at Hendon and develop a simple brief.

The resulting contract value was £422,664.09. The value provided in Routine Contracts £1,600,000 reflected the anticipated contract value.

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