{meta} Decision - Request for Approval - Contract Extension - Postal Services

Decision details

Decision status: Recommendations Approved

Is Key decision?: No

Is subject to call in?: Yes

Decision:

Salford City Council - Record of Decision

 

I, Councillor Bill Hinds, Lead Member for Finance and Support Services and chairman of the Procurement Board, in exercise of the powers contained within the Council Constitution, do hereby approve the extension of the contract for Postal Services – Collaborative tender process with Yorkshire, Humber and AGMA councils, as outlined in the table below:

 

Detail required

Contract Reference

tbc

Title/Description of Contracted Service/Supply/Project

Postal Services

Name of Contractor

Whistl UK Limited

Type of organisation

(to be supplied by Corporate Procurement)

Private Limited Company

Status of Organisation

(to be supplied by Corporate Procurement)

Non-SME

Value of Contract Extension

£350,000

Per annum (estimated average)

Existing Contract Term

01/09/2018

to

31/08/2019.

Extension Period Requested

01/09/2019.

to

31/08/2020

Contact Officer (Name & number)

Peter Cowling (4996)

Lead Service Group

Service Reform & Development

Funding Source

Revenue Budget

Details: There is provision within the current contract to extend the agreement for a further period of 12 months from 01/09/2019 to 31/08/2020. Current postal volumes will continually be monitored and transition to digital communication methods in line with transformation of the service will seek to reduce volumes further.

 

The Reasons are: Following notification of extension by framework partners Yorkshire &Humberside for a further 12month period the authority has secured better commercial terms than would be possibly individually, One of the major strengths of the Whistl agreement is Volume related discounts (VRD) to all participants based on combined volumes.

Options considered and rejected were: To procure the service individually. However, we would be unable to match the savings applied from volume based discounts achieved by the collaborative offer. This contract was procured via a competitive tender process therefore ensuring the best value supplier was appointed.

 

Assessment of Risk: Low.

The source of funding is: Revenue Budget.

Legal Advice obtained: When the contract was originally procured by way of a fully compliant process it was made clear in the documentation that the original two year term would be subject to two potential extensions of twelve months each, hence any risk that the proposed extension would be subject to realistic challenge is extremely low, and the option to extend within the contract is now being properly exercised.

Financial Advice obtained: Postage charges are recharged out to individual directorates on a monthly basis.  If volumes remain static, there is sufficient budget within the Council to fund these costs.  As highlighted within the report and associated appendices, the current contract offers value both financially and socially, with the current contract experiencing a 2% saving due to volumes, saving the Council approx.£18k .  However, we must continue to monitor volumes closely as the push towards digital transformation will inevitably drive down volumes which could impact upon the VRD and may make the contract no longer financially beneficial in the future.

 

Procurement Advice obtained: As outlined in the body of the report, the recommendation to extend the existing contract is both compliant with the terms of the original procurement process and ensures the Council will continue to receive best value due to the volume related discounts that would not be achievable without collaboration with the other contracting authorities.

The following documents have been used to assist the decision process.

 

RM1063 Tender Report – Summary paper produced by Lead Authorities outlining the result of the tender process (available on request)

 

Record of Decision 24/08/16

Record of decision 13/06/18

 

Whistl Social Value Statement 2019



Contact Officer:  Peter Cowling                         Tel No 4996

 

*         This decision is not subject to consideration by another Lead Member

*         The appropriate scrutiny committee to call-in the decision is the      Overview & Scrutiny Board.

 

 

Signed:    COUNCILLOR BILL HINDS               Dated:  10 JULY 2019                                                 

                     Lead Member

 

FOR DEMOCRATIC SERVICES USE ONLY

 

*         This decision was published on 10 July 2019.         

                                   

*         This decision will come in force at 4.00 p.m. on 17 July 2019 unless it is called-in in accordance with the Decision Making Process Rules.

 

Publication date: 10/07/2019

Date of decision: 10/07/2019

Decided at meeting: 10/07/2019 - Procurement Board

Effective from: 18/07/2019

Current call-in Count: 0

Accompanying Documents: