Community Benefits and & the Small Lots Exemption

Transcription

1 Procurement Lunchtime Surgery 058 Community Benefits and & the Small Lots Exemption Presented By: Stephen Regalado Lambeth Corporate Procurement Our Procurement Priorities Times are hard and procurement officers are in the spotlight. We are needed to deliver services and products at lower prices without compromising on quality. Key priorities: The Cooperative Council Save Money Quality Services & Products Collaboration, Aggregation, Partnerships, Shared Services Community Benefits local SMEs and third sector organisations 2 Innovation & Partnership We need to think about different ways of providing and buying goods and services. We still need to improve value for money while not reducing quality. We have to work within EU procurement rules but must look for techniques, exemptions and/or postaward processes that deliver results. Need to work with, rather than against, our contractors, service providers and suppliers. 3 1

2 The Cooperative Council & Procurement Two main goals for procurement: 1. Procurement should adopt procurement processes and procedures with a view to moving to a system which is less risk-averse, more proportionate t and acts as less of a barrier to small local organisations. 2. Procurement should develop a lobbying strategy to secure amendments to UK & EU procurement legislations that impede the implementation of the Cooperative Council, whilst ensuring employment rights for the council staff are protected 4 New Delivery Models for Coop Contracts The Cooperative Toolkit: Outsourcing Commercial Tendering Shared Services Other Public Bodies Services Personalisation In House Delivery Co-production Grant Initiatives Staff Groups mutuals, federated services 5 b What Are Community Benefits? Community benefits are "goodwill contributions that are voluntarily donated by a supplier for the benefit of communities affected by the contract they are delivering. For example, in a construction contract we could include a community benefit clause in our specification which requires they put in place an apprenticeship programme for workers on the contract. You can find Lambeth s Community Benefit Clauses here: %20documents/Community%20Benefits/Community%20Benefit%20Cl auses%20guidance.doc and the Community Benefits Checklist here: %20documents/Community%20Benefits/Community%20Benefits%20P rocurement%20checklist.docx 6 2

3 Community Benefits Some contract areas where we can seek benefits: Environment and sustainability Training and apprenticeships Local jobs You have to be careful when including Community Benefits in your specification: these clauses cannot contravene competition. For example we cannot insist that suppliers use local Lambeth suppliers to deliver their product or service. 7 Local SMEs & Third Sector Organisations 8 Under EU procurement rules we cannot force suppliers to use local SMEs or third sector organisations or local labour when delivering their contracts We often get good quality services from SMEs and or third sector organisations but are they the best price option? Local government needs to generate opportunities for local businesses/residents wherever possible The Lambeth Procurement Strategy An alternative approach is through the EU Small Lots exemption. How Do We Do It? How Can We Deliver Our Priorities & Community Benefits Whilst Remaining Fair, Transparent & Legal? 9 b 3

4 One Solution is the use of the EU Public Procurement Directive Small Lots Exemption 10 b The Small Lots Exemption Regulation 8(12) of the Public Contracts Regulations This exemption is an opportunity, when valuing a contract to establish relevant financial threshold for public works/services/supplies, to exclude a Small Lot and procure this in a different way. Exclusion of Small Lots from the OJEU Notice and subsequent procurement procedure creates flexibility for local authorities to address local issues through procurement. 11 Small Lots The has a value: 64,826 for services and supplies 810,580 for works, constructions and maintenance The value must also be less than 20% of aggregated value of all contracts for the relevant services/ supplies/works Why is this an opportunity for smaller businesses and third sector organisations? 12 4

5 Limits on Small Lots Exemptions Use of Small Lots cannot lower overall EU threshold by taking out the value of a Small Lot. The current advertising thresholds are: 156,442 for services and supplies 3,927,260 for works, constructions and maintenance Aggregation rules will apply when assessing total value of the goods/services/works identified as Small Lots. 13 How Can It Be Created? How Should It Be Treated? A Small Lot contract must relate to the outcome of any works which is sufficient of itself to fulfil an economic or technical function. It could be a bridge, a hospital, a block of flats, a house, a community centre or a programme of roofing works or cyclical painting. Can be broken down into separate works packages but not so as to artificially disaggregate an overall works programme or to convert works into services or supplies. 14 What About Services & Supplies? Services and supplies contracts are subject to aggregation rules where entered into in order to fulfil a single requirement. Current EU limit for services and supplies is 156,442. This will be applied to the aggregated single requirement. Small Lots exemptions in relation to services/supplies needs to be considered in light of all contracts for same type of services/supplies even if awarded at different times. 15 5

6 Small Lots & Framework Agreements The Small Lots exemption applies to contracts very neatly but it is less clear on how it applies to framework agreements. The question is: how could the bundling of works/services/supplies under a framework be combined with excluding Small Lots? Suggestion: that the exclusion of Small Lots needs to be proportionate to the overall framework agreement and to the work intended to be awarded under that framework each year. Be sure to look at individual frameworks very carefully and take advice. 16 Example: The Bundling & Unbundling of Services Contracts Consider, for example, an estates services contract. It comprises of different activities: Graffiti removal Estate cleaning Bulk rubbish removal Grounds maintenance Possible identification of one service easily separated from the others and let as a Small Lot perhaps graffiti removal. The value must meet the threshold criteria and must not comprise more than 20% of overall requirement for estate services 17 Example: The Bundling & Unbundling of Services Contracts The graffiti removal part of the estates contract is valued at 60,000. As it does not meet the EU threshold, we can advertise it locally: Lambeth website Contracts Finder Local magazines, periodicals, websites, etc. Local third sector organisations such as LVAC, GLE, etc. Advertising locally will get a better local supplier response. At a lower value, this contract can be delivered by a smaller business. 18 6

7 Opportunities for Using Small Lots Facilities management: repairs and maintenance, cleaning, grounds maintenance etc. Construction, works, repairs. Back office services: customer services, printing, advertising, recruitment etc. Other areas: cleaning, car-park management, catering etc. 19 Reminders: Practical Assistance for SMEs Procurement procedures need to be simple and not unduly onerous for small companies. Advertise in local press and internet sites where SMEs will have access. Review level of administration in terms of BQ requirements and specification content. 20 More Information OGC s Smaller Supplier, Better Value rement/public%20documents/office%20of%20gover nment%20commerce/ogc%20- %20Smaller%20Supplier%20Better%20Value.pdf Local Government Lawyer om_content&view=article&id=5694:small-can-bebeautiful&catid=57:employment-articles 21 7

8 More Information Social Issues in Public Procurement rement/public%20documents/office%20of%20gover nment%20commerce/ogc%20- %20Social%20Issues%20In%20Public%20Procurem ent.pdf 22 Question & Comments If you have any questions or comments, please contact me directly: Stephen Regalado Procurement Officer: Customer Engagement Phone