Agenda item

The Committee considered a report, presented by Holly Wilson, Head of Procurement which provided Members with details of all the waivers and breaches to the Council’s Contract Procedure Rules (CPRs) for the period 1st March 2022 to 31st August 2022. The report provided a summary of the new waivers and breaches recorded for each directorate since the last audit report presented to the Committee in April 2022 for comparative purposes.  Further details of each waiver and breach and the total contracts awarded versus the number and value of waivers for the period, were summarised in Appendices 1 to 3, respectively.

It was noted that there for the period 1st March 2022 to 31st August 2022 there had been 17 waivers granted which had increased from the last 6 month reporting period where there had been 14 waivers, however there had been a decrease to the amount of waivers for the previous 6 months period.  The figures remained static.

4 existing breaches from the previous reporting period had been positively resolved, but there were 6 new breaches as set out in Appendix 1 of the report. There were zero unresolved breaches.

Members sought clarity on aspects of the report, in particular in relation to the 4 new breaches in the Corporate Resources directorate relating to the schools catering department, as detailed at Appendix 1. Members asked for assurances to prevent this issue reoccurring in the future. The Head of Procurement outlined the reasons for the breach which were due to miscommunication and oversight within the department where officers had wrongly made the presumption that the extension period within the original awarded contract was to be extended, however this was not the case and unfortunately Officers had failed to notice the error. It was noted that currently the Procurement team operated from an established spreadsheet category plan system and a spend analysis system for the contracts register. On occasion there had been administrative errors in the system, but this was very rare. It was noted that the current spreadsheet system does not have the functionality to provide an audit trail of any changes made to the system. Members were advised that a new contract procurement pipeline module was to be implemented as part of the Council’s e-Tendering system.  The system would flag up when any new contracts were for renewal and would allow for data to be stored and managed in one central location. It was anticipated that the new system would go live in December 2022. Assurances were provided that the administrative errors previously made would not re-occur.

Members were pleased to note that there had been no further breaches in the Adults Health and Wellbeing directorate given the concerns raised by the Committee with regard to the issues in the previous year. Following a question by the Chair, the Head of Procurement confirmed that she was satisfied with the current arrangements and assured Members that the new contract pipeline module would help improve the data. In response to a request from the Chair, the Head of Procurement undertook to ensure that the Committee be given advance notice of any matters that arise which may be problematic before formal consideration by the Committee.

Members whilst welcoming the reduction in breaches, made reference to the 2 breaches of Contract Procedure Rules (CPRs) which related to failure by Officers to follow the correct procedures by failing to obtain 3 quotes for contracts, Members felt this was a routine easily accomplished task and was fundamental to the tendering process. It was highlighted that breaches to CPRs exposed the Council to reputational risk, felt these breaches were relatively low risk. Councillor Shaw recognised that mistakes could happen, however raised serious concerns that officers who have responsibility for assessing and tendering for contracts had not received the appropriate training on Contract Procedure Rules (CPRs), and had signed off contracts which he felt should have been done so at a senior level. 

The Committee sought assurances that such breaches would not occur again and for Officers to seek appropriate advice before any contracts were awarded.

The Head of Procurement advised that those Officers did not have a clear an understanding of CPRs as they had not undertaken the appropriate training. She acknowledged that due to the size of the organisation, the significant amount of contracts and the high turnover of staff, some officers had slipped through the net and had not received training on CPRs and the procurement of contracts. To mitigate against this happening in the future, she undertook to ensure that those officers who had breached CPRs to attend the appropriate training in order to raise awareness of their responsibilities when tendering for contracts.

The Committee acknowledged the difficulties in enforcement of the training due to difficulties in recruitment of staff in some areas of the Council, however raised strong concerns regarding contracts being signed by Officers without the necessary training. In these circumstances poor decision making had left the Council open to criticism, reputational and financial risk which could also potentially bring legal action against the Council.  In order to ensure oversight of the contract tendering process, the Committee felt that contracts to be signed off at a senior level and arrangements be put in place for any decision made regarding contracts to be assessed at a senior level to ensure that the decision taken was valid. It was also proposed that training on CPRs be mandatory for managers who procured and awarded contracts and in order to reduce the potential for breaches of CPRs re-occurring in the future sought assurance how to mitigate against this happening in the future. 

The Assistant Director of Finance in acknowledging the concerns raised, advised that during consideration of the Annual Governance Statement, a specific action had arisen reminding all managers that as part of new officer induction training, that training be provided on the requirement to raise awareness of CPRs and Financial Procedure Rules (FPRs). It was reported that some Officers had previously undertaken training on FPRs. The Assistant Director of Finance gave an undertaking to ensure that all managers were made aware of their responsibility to ensure that any new starters at the Council who are involved in the procurement or awarding of contracts, to receive training on CPRs and Financial Procedure Rules as part of their induction training, and explore whether this training could be made mandatory.

RESOLVED that

(1)      the waivers and breaches recorded for the period between the 1st^t March 2022 and the 31st August 2022, be noted; and

(2)      the work undertaken by the Strategic Procurement Team (SPT) to ensure compliance and deliver services be noted; and

(3)      the Assistant Director of Finance to explore whether mandatory training on CPRs and to be undertaken by managers as part of their induction training when as a new starter at the Council.