Decision status: Recommendations Approved
Is Key decision?: No
Is subject to call in?: Yes
Salford City Council - Record of Decision
Developing a skilled, flexible and resilient workforce able to achieve our ambition of ‘A Better and Fairer Salford’, can only be achieved if we invest in skills and professional development and we continue to attract and retain the best talent into the organisation.
High quality skills and professional development delivered through apprenticeships, in line with our Apprenticeship Strategy and Workforce Strategy, for both new and existing employees can make a positive contribution to this by creating opportunities for people, of all ages, to undertake relevant qualifications, helping to raise skills, capabilities and aspirations.
It is critical that suitable arrangements for apprenticeship delivery are put in place to meet the demand for highly skilled people to deliver high quality services.
In November 2018 Procurement Board approved the strategy for the procurement of apprenticeships and for Salford City Council to enter into a strategic partnership with Salford College and The University of Salford as part of this strategy. The requested period for this strategy was 12 months to allow the Council, Salford University and Salford College to mature the partnership.
The strategy for the procurement of apprenticeships and the strategic partnership is a key enabler to realise our ambitions outlined in our Apprenticeship Strategy – improving skills, professional development and creating career pathways through apprenticeships to ensure that we have the right people, in the right place, with the right skills at the right time.
This has resulted in the Council not only being able to meet its statutory target for new apprenticeship starts in 2018/2019 but also to be one of the top performers within GM public sector.
This initial 12 months has resulted in the Council identifying the need to continue to take a strategic approach to the procurement of apprenticeships. One that not only complements the ambitions of our Apprenticeship Strategy but achieves the best value for money and is differentiated to meet the Council’s needs.
The strategy for the procurement of apprenticeships demonstrates that there is a balanced approach and it is working successfully, giving the Council options to maximise its resources and obtain the best route to market to meet the needs of the Apprenticeship Strategy.
Following the success of the relationship to date it the next term of the partnership will be for four years with a total estimated value of £2.5million over the four year period.
This term will allow the Council, Salford University and Salford College to further mature the strategic partnership and maximise the associated benefits.
Options considered and rejected were the cessation of the strategy for the procurement of apprenticeships which given the risks of not having this strategy weighed against the risk of not being able to meet our statutory targets and any underspend of the Council’s digital funds being returned to Central Government.
Legal advice obtained- When commissioning contracts for the procurement of goods, services or the execution of works the Council as a ‘contracting authority’ must comply with the Public Contract Regulations 2015 (PCR) as well as the provisions of its own Contractual Standing Orders (CSO’s), Financial Regulations and the duties of Best and Social value.
In addition, whilst these services fall within the “light touch regime”, the PCR require that contracting authorities treat candidates equally and in a non-discriminatory way and act in a transparent manner, failing which the award of a contract may be subject to legal challenge. For contracts of a value of up to £10k, an informal written quotation from one (or more) provider will suffice in any event, and if between £10k and £30k the Council would usually undertake an exercise to obtain quotes from three suitably qualified providers.
The approach to be taken to the procurement of apprenticeships, and the partnership between the Council, Salford City College and the University of Salford will bring advantages to the Council to provide apprenticeship training, and will create a unique model of provision, hence any risk of challenge from alternative providers should be low.
Helpfully the PCR provides for exemptions from the scope of the Regulations for both in-house and joint co-operation arrangements between public bodies, which are applicable to the circumstances for the strategic partnership, specifically:
Regulation 12(7) sets out an exemption for joint co-operation between contracting authorities where (to paraphrase):
(a) the contract establishes joint co-operation in the performance of public services with a view to achieving mutual objectives; and
(b) the implementation of the co-operation is governed only by the public interest; and
(c) the participating authorities perform “on the open market” less than 20% of activities concerned by the co-operation.
In addition, the partnership appears to be a unique provider in the market for these services as described, who are in a position to deliver the level of outcomes and benefits across the range of training services required by the Council.
The DPS system can also continue to be accessed and called upon where the Council deems it appropriate, as referred to in the body of the report.
Detailed reasons for requesting approval for the proposed process for awarding the apprenticeship training services are set out in the report, namely the cost encountered in sourcing the services, whilst still obtaining value for money and providing best value going forward, the unique nature of the partnership and services which it can provide, and the relative urgency for the services.
The risk of a challenge to the continuation of the approach adopted increases with the value and duration of a proposed contract being awarded, and the risk of any such challenge being successful may be regarded as extremely low.
Financial advice obtained - Contributions of 0.5% of the wage bill are made into the apprenticeship levy account which is topped up by 10% from central government. The value of the apprenticeship levy account is circa £700k per annum. The strategic partnership is a non-exclusive arrangement and, in terms of value for money, a minimum discount on full cost has been agreed. There is further added value in managing apprenticeships through the strategic partnership in terms of additional resources and maximising social value, particularly through the Salford Skills for Business Fund. The approach outlined in the report maximises value for money whilst also limiting the level of resources required for the tendering process. It must be noted that quality control will be of upmost importance to ensure the continued success of this approach and that value for money can be evidenced.
Procurement advice obtained - The services in the subject of this report are categorised as Education and are covered under the Public Contracts Regulations “Light Touch Regime”. The value of contracts considered to be in scope of the LTR are those valued above £615, 278.
The Procurement Strategy approved in 2018 has proven to be successful in helping the Council deliver its apprenticeship strategy, achieve value for money, and also deliver some excellent social value benefits.
To date £74,000 in cost savings have been achieved, which is calculated as the percentage discount applied to the value of apprenticeships awarded to the partnership. This effectively means that this money can be reinvested and used to buy more apprenticeships.
The Strategic Partnership between Salford City Council, Salford College and the University, is a unique partnership that does not exist elsewhere in the market that is helping the Council to meet its apprenticeship aims and aspirations. There are provisions within the Public Contracts Regulations that provides exemptions in circumstances when certain criteria is met. In this instance it can be demonstrated that the Strategic Partnership is a joint co-operation in the performance of public services with a view to achieving mutual objectives.
The continuance of the Procurement Strategy for Apprenticeships will ensure that this continues going forward to maximise the social value benefits, and continue to achieve value for money.
It is been demonstrated that the apprenticeship team are regularly monitoring the partnership, whilst at the same time continuing to take a balanced approach with other training also being procured through other routes such as the AGMA DPS.
The following documents have been used to assist the decision process.
(DCLG publication, October 2017)
Procurement Board - Approval of the Proposed Strategy for the Procurement of Apprenticeships (Part 1)
* This decision is not subject to consideration by another Lead Member
FOR DEMOCRATIC SERVICES USE ONLY
Publication date: 27/11/2019
Date of decision: 27/11/2019
Decided at meeting: 27/11/2019 - Procurement Board
Effective from: 05/12/2019