Maintenance Review 2004 A review of the procurement of repair and maintenance works for Hertfordshire County Council.

2 © Mouchel Parkman 2004 Building Repairs and Maintenance Responsive Works Planned Works Cyclical Works

3 © Mouchel Parkman 2004 The Review Objectives In view of the expiry of the current MTC’s in September 2005, the review was commissioned to: Conduct a strategic options appraisal for the procurement & delivery of maintenance works from 1 October 2005; Canvass the opinion and experience of stakeholders in order to identify the most suitable option; Identify areas of best practice in Local Authority and commercial sectors and to incorporate these into the strategic review; and To consider expansion of the maintenance contracts into works carried out directly for schools under devolved funding.

4 © Mouchel Parkman 2004 MTC Contractors MP Staff Herts Property End Users Service Departments Contractor Competition Other MP Offices/ Contracts Other LA’s & Commercial Sector MP Management Consultancy Knowledge Sources Stakeholders MTC

5 © Mouchel Parkman 2004 Options The following five options were identified during the review: 1.Pre-MTC Procurement of Works 2.Continuation of Current 3.Framework Arrangements without detailed pricing basis 4.Single Partner MTC 5.Mixed Model (Recommended)

6 © Mouchel Parkman 2004 Options 1.Pre-MTC Procurement of Works Reactive works carried out on an informal basis. Cyclical works on a variety of contracts. Planned works tendered to standard JCT form of contract.

7 © Mouchel Parkman 2004 Options 1.Pre-MTC Procurement of Works 2.Continuation of Current Measured Term Contract Measured Term Contracts for the provision of reactive, cyclical and planned repairs and maintenance works. Proven reactive 24/7 maintenance arrangements. Utilization of bespoke web based works ordering tool. Appropriate (and improving) quality.

8 © Mouchel Parkman 2004 Options 1.Pre-MTC Procurement of Works 2.Continuation of Current 3.Framework Arrangements Multiple independent framework arrangements. A variety of Contractors. No detailed cost basis.

9 © Mouchel Parkman 2004 Options 1.Pre-MTC Procurement of Works 2.Continuation of Current 3.Framework Arrangements 4.Single Partner MTC A single contractor for all maintenance works.

10 © Mouchel Parkman 2004 Options 1.Pre-MTC Procurement of Works 2.Continuation of Current 3.Framework Arrangements 4.Single Partner MTC 5.Mixed Model (Recommended) Combines the advantages of MTC’s for reactive and cyclical works with the advantages of framework arrangements for planned works.

11 © Mouchel Parkman 2004 Recommendation A recommendation based on the mixed model is made as follows: One Reactive and Cyclical M&E Contract Planned Maintenance Contractor A Planned Maintenance Contractor B Planned Maintenance Contractor C One Reactive and Cyclical Building Contract Heating Framework Roofing Framework

12 © Mouchel Parkman 2004 Recommendation A recommendation based on the mixed model is made as follows: 1.A reactive and cyclical building works contract A Measured Term Contract. Based on the National Schedule of rates. For all works across the County. One Reactive and Cyclical M&E Contract Planned Maintenance One Reactive and Cyclical Bldg Contract Heating Framework Roofing Framework

13 © Mouchel Parkman 2004 Recommendation A recommendation based on the mixed model is made as follows: 1.A reactive and cyclical building works contract 2.A reactive and cyclical Mechanical and Electrical Services contract. This will be delivered on the same basis as the building works contract. One Reactive and Cyclical M&E Contract Planned Maintenance One Reactive and Cyclical Bldg Contract Heating Framework Roofing Framework

14 © Mouchel Parkman 2004 Recommendation A recommendation based on the mixed model is made as follows: 1.A reactive and cyclical building works contract 2.A reactive and cyclical Mechanical and Electrical Services contract. 3.A specialist framework arrangement for roofing works. One Reactive and Cyclical M&E Contract Planned Maintenance One Reactive and Cyclical Bldg Contract Heating Framework Roofing Framework Reduced costs through direct management of the supply chain.

15 © Mouchel Parkman 2004 Recommendation A recommendation based on the mixed model is made as follows: 1.A reactive and cyclical building works contract 2.A reactive and cyclical Mechanical and Electrical Services contract. 3.A specialist framework arrangement for roofing works. 4.A specialist framework for boiler replacement and associated heating works. Reduced costs through direct management of the supply chain. One Reactive and Cyclical M&E Contract Planned Maintenance One Reactive and Cyclical Bldg Contract Heating Framework Roofing Framework

16 © Mouchel Parkman 2004 Recommendation A recommendation based on the mixed model is made as follows: 1.A reactive and cyclical building works contract 2.A reactive and cyclical Mechanical and Electrical Services contract. 3.A specialist framework arrangement for roofing works. 4.A specialist framework arrangement for boiler replacement and associated heating works. 5.Three overlapping framework arrangements for all other planned building works. These framework arrangements will include facilities for procuring roofing and heating works in order to ensure that choice is retained.

17 © Mouchel Parkman 2004 Innovative Improvements A random market test of 10% of planned works to use in evaluating best value and benchmarking to the market. Use of Key Performance Indicators to award increased work. Involvement of the Supply Chain during tender process to promote partnerships with local contractors.

18 © Mouchel Parkman 2004 Recommendation This recommendation builds on the successes of the current Measured Term Contracts and introduces: An element of benchmarking for planned works. Work allocation based on performance. Benefits to end users of continuous improvement. Flexibility, innovation and partnership An efficient pricing mechanism. End user choice The perceptions of end users, best practice in the wider market and lessons from the past are all incorporated into this proposal.

19 © Mouchel Parkman 2004 Questions

20 © Mouchel Parkman 2004 A four year term is recommended Recommendation It is proposed that break clauses are inserted in the contracts to accommodate any future shift in strategic procurement policy by Hertfordshire County Council. Nov 2004 Nov 2005 Mar 2008 Nov 2009