AGENDA ITEM NO.

3(1)

CABINET - 23RD FEBRUARY 2012

SUBJECT: PROCUREMENT SERVICES COLLABORATION BETWEEN MERTHYR COUNTY BOROUGH COUNCIL AND CAERPHILLY COUNTY BOROUGH COUNCIL. DEPUTY CHIEF EXECUTIVE

REPORT BY:

1. 1.1

PURPOSE OF REPORT The report outline proposals for collaborative strategic procurement arrangements between Caerphilly County Borough Council and Merthyr Tydfil County Borough Council This Collaborative would support the modernisation agenda in Local Government in Wales.

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2. 2.1

SUMMARY Public Sector Procurement in Wales has been subject to much change in recent years. For many the function has moved from an operational devolved activity to a strategically led central function with standard operating practices. Merthyr Tydfil CBC, although making progress in the last twelve months is still an organisation with limited procurement resource and capability.

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3. 3.1

LINKS TO STRATEGY The proposed collaboration between Caerphilly and Merthyr supports the following key strategic documents: Buying smarter in tougher times One Wales, a progressive agenda for Government of Wales. Making the Connections in Delivering better services for Wales Better Value Wales

4. 4.1 4.2

THE REPORT Better local authority collaboration has been the focus of many reports in recent years. Merthyr Tydfil CBC has carried out a procurement capability and maturity assessment during 2011. The conclusion shows a clear capacity and capability deficiency within the authority in terms of strategic procurement. Caerphilly CBC has invested money in improving its procurement capacity over the last 10 years. The Authority has an established team of procurement professionals with dedicated responsibility on a directorate by directorate basis.

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4.4 4.5

The Authority has embedded e-Procurement and e-Trading capacity. In Caerphilly the time is right to take further steps to build on and further optimise the investment in Skills and Capability. There are clear opportunities to leverage the current level of professional services into Merthyr CBC and possibly other less mature organisations. The model of a collaborative procurement service with Merthyr would harmonise well with the Welsh Agenda of increased collaborative working. The model will support current thinking on Joint Working, standardisation of process and procedures including standing orders for contracts and standard terms and conditions. The work would complement current work in Wales in developing collaborative working on common and repetitive spend. It is proposed that the Head of Procurement from Caerphilly will develop a target operating model by end March 2012 with the transition phase following during April - September 2012. This work will be supported by a project team with Officers from Caerphilly County Borough Council and Merthyr Tydfil County Borough Council. The Head of Procurement from Caerphilly will develop a full training programme for Senior Officers and Members within Merthyr to be presented within the first 3 months of the project.

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5. 5.1 5.2

FINANCIAL IMPLICATIONS Officers are currently investigating opportunities for funding with Value Wales and WLGA. Officers will provide details of cost to Members once the Target Operating Model has been agreed. Savings could be achieved through effective management of the supply chain and reduced duplication in procurement processes.

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6. 6.1

PERSONNEL IMPLICATIONS The proposal, through the redesigning of the current staff structure within Merthyr Tydfil, will create opportunities for existing employees, whether internally or externally focused. These external opportunities would be potentially as part of the broader collaborative groups, where opportunities exist. There are no personnel implications for staff within Caerphilly County Borough Council.

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7. 7.1

CONSULTATIONS The views of the consultees have been reflected in the report.

8. 8.1

RECOMMENDATIONS It is recommended that members agree the proposal for a Collaborative Procurement service to be developed.

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STATUTORY POWER Local Government Act 1972 and 2000.

Author: Consultees:

Elizabeth Lucas, Head of Procurement Alison Standfast, Deputy Director, Value Wales (Procurement), Alison.Standfast@Wales.GSI.Gov.UK Paul Charkiw, WLGA, Head of Efficiency and Procurement, paul.charkiw@wlga.gov.uk Gary Thomas, Director of Customer Services, Gary.Thomas@merthyr.gov.uk Nigel Barnett, Deputy Chief Executive, barnen@caerphilly.gov.uk Nicole Scammell, Head of Corporate Finance, scam@caerphilly.gov.uk Ellis Cooper, Assistant Director Customer Services, Ellis.Cooper@merthyr.gov.uk Sharon Phillips, Business Development Manager, Sharon.Phillips@Merthyr.gov.uk Ken Thomas, CMC Partnership, Managing Consultant, Ken.Thomas@cmcpartnership.com Cllr Colin Mann, Cabinet Member, Finance, Resource and Sustainability County Councillor, manncp@caerphilly.gov.uk