Provision of vehicle fuel charge card facilities

Report: 12
Date: 26 May 2005
By: Commissioner

Summary

The current Metropolitan Police Service (MPS) contract for the provision of fuel cards is due to expire on 30 June 2005. This report seeks MPA approval to award a new contract to the preferred bidder for two years two months with an option to extend for a further two years. The total cost of the initial two year two month period, based on estimated fuel consumption, is £18M; this is £0.43M less than this volume would cost under current contract arrangements.

A. Recommendation

That the MPA approves the proposal to award a two year two month contract from 1st July 2005, with an option for a further two-year extension, to the preferred bidder. The estimated cost for two years two months, based on current consumption, is £18M.

B. Supporting information

Background

1. The MPS has a requirement to provide fuel for approximately 6000 vehicles not only within the Metropolitan Police District (MPD) but also for some vehicles, throughout UK and overseas. A variety of fuels are required, the most common of which are unleaded petrol and diesel. The provision of a credit card sized fuel card, administered by a contractor, is necessary to enable fuelling of the MPS fleet not only from agency fuel sites but also the MPS bulk fuel installations.

2. The contract includes the provision of information to allow the comprehensive management of the vehicle fleet across all areas of policing. It does not however cover the provision of fuel to the bulk sites, which is currently supplied through separate contract arrangements with the Office for Government Commerce (OGC).

Competition

3. The requirement was advertised in the Official Journal of the European Union (OJEU) and expressions of interest were received from six companies. Tender bids were subsequently received from five companies.

4. The object of the tender process was to optimise overall value for money both on an initial and long-term basis. Key areas for the MPS were technical ability, fuel site coverage, ongoing price competitiveness and pricing flexibility i.e. ability to swap between pump price minus rebate and Platts pricing (which is based upon the market price of oil) depending on prevailing economic conditions.

Contract Length

5. The advertised contract length was for three years with an extension option of two periods of up to 12 months each. However, in order to align the contract dates with other existing arrangements, it is proposed that the initial contract with the preferred bidder will only run for approximately two years two months with a further extension for up to two years.

C. Race and equality impact

Companies tendering for this contract were asked to complete commercial and technical questionnaires that addressed equality and diversity issues. The Company to whom it is proposed to award the contract has an acceptable Equality and Diversity Policy and a satisfactory industrial relations record. It is not anticipated that there will be any equality or diversity issues in respect of this contract.

D. Financial implications

If the MPS were to choose the preferred bidder, it will be possible to achieve full-year budget savings of approximately £433K over the current fuel contract costs over the proposed initial two year two month contract term. This sum will be removed from the 2006/07 transport budget and will be available for redirection to front line policing services as part of the 2006/07 budget round. From July 2005 to March 2006 there will be an approximate saving of £149K.

E. Background papers

None

F. Contact details

Report author: Stuart Middleton, Director of Transport Services.

For more information contact:

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

Appendix 1

Provision Of Vehicle Fuel Charge Card Facilities – Exempt Information.

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