Renewal of contract for TSG carriers

Report: 24
Date: 19 July 2001
By: Commissioner

Summary

A request for authority to negotiate and agree a two year extension to the existing leasing/ service contract with Charterway.

A. Recommendation

That the Committee agree to the extension of this existing contract for a period of up to twenty four months.

B. Supporting information

1. Metropolitan Police Authority (MPA) approval is sought for an extension to contract of up to two years to the existing contract, which is due to expire in March 2002.

2. The current Territorial Support Group (TSG) fleet consists of 210 Mercedes Sprinter vans and is in good condition, both mechanically and in respect of bodywork. There is high expectation that they will sustain a further two years operational use. 89 of these vehicles are owned by the MPS outright, the remaining 121 vehicles are leased from Charterway. The existing contract with Charterway is for the lease of the 121 vehicles and for the repair and maintenance for all the 210 vehicles in the TSG fleet. The users are extremely satisfied with the quality of service provided. Charterway is the commercial leasing arm of DaimlerChrysler .

3. The initial contract term was for a period of five years, 1997 to 2002, and contains provision for extension by agreement between the parties.

4. The reasons for requesting authority to negotiate at this early date are:

• to allow for alternative procurement action to take place, should authority to extend not be given;
• an extension 'buys time' whilst the proposed MPS Transport Strategy is finalised and approved. In order to maintain the MPS response to public order requirements and commitments it is imperative that any transition in the support /supply of the TSG fleet is carried out in a seamless manner;
• an extension makes sound commercial and operational sense by providing for continuation of a satisfactory service whilst longer term arrangements are reviewed at prices which represent good value for the MPA.

C. Financial implications

The initial proposal for the two years extension from Charterway indicates savings against the current charges. We intend to secure further reductions during negotiations. Financial details of the contract and the estimated cost of any extension are contained in a separate 'exempt' report to be considered at this meeting.

As the residual values of second hand vehicles have continued to be depressed there is unlikely to be a cost benefit from disposal of the vehicles at this time. Given these residual values, best value at this time would be achieved by continuing to run the existing fleet.

D. Background papers

None.

E. Contact details

The author of this report is Christine Tearle, MPS Department of Procurement and Commercial Services.

For information contact:

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

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