Cabinet Member Delegated Decision Decision due: 19th March
Cabinet Member Delegated Decision Decision due: 19th March 2015 Contract Award for the delivery partnership with Emmaus Lambeth for the Emergency Support Scheme (under waiver) Wards: All Report Authorised by: Helen Charlesworth-May, Strategic Director Commissioning Portfolio: Paul McGlone, Deputy Leader (Finance and Investment) Contact for enquiries: [email protected] Emily Newell, Commissioning Officer - Financial Resilience, 020 7926 0973 Report summary This report seeks permission to award Emmaus Lambeth a two year contract (1st April 2015 to 31st March 2017) under waiver to extend and increase the value of their existing contract to provide furniture, white goods and a home removal service for applicants to the Emergency Support Schemes in Lambeth and Lewisham. The contract will have a £35,000 base value per annum with an additional up to £450,000 in spot purchasing of goods and services per annum. Emmaus Lambeth have been providing this service to Lambeth residents since the Emergency Support Scheme was established in April 2013 and it is intended that they will offer a service to Lewisham after the 1st April 2015 when the schemes merge. The London Boroughs of Lambeth and Lewisham were provided with grant funding to run Local Welfare Assistance Schemes in 2013/14 and 2014/15, and this was subsequently removed from April 2015 onwards but Lambeth and Lewisham will use the underspend on this grant to run a shared Emergency Support Scheme for a minimum of 2 years from April 2015. This scheme will be run by LB Lambeth on behalf of LB Lewisham. Failure to continue providing a local scheme will leave many thousands of financial vulnerable families and single households without the key support they need to set up home after a period in care or after a period of homelessness, or without the support they need to manage a disaster or crisis. Finance summary This report proposes to award Emmaus Lambeth a contract with a base value of £35,000 per annum and up to £450,000 in spot-purchased goods and services per annum starting 1st April 2015 and ending 31st March 2017. As the volume of referrals and outputs is unknown at this stage a block funded contract would not be suitable, however the intention is to fix an upper limit on spend of £450,000 per annum, which will cover awards made to both Lambeth and Lewisham applicants. Under this contract, goods and services will be purchased at agreed maximum rates, and Lambeth will be invoiced for awards on a monthly basis. The contract will also provide a separate annual fixed sum to Emmaus Lambeth of £35,000 to cover staffing and on-costs associated with the administration and management of referrals in both boroughs under the scheme. This contract will be paid using underspend from grants provided to Lambeth and Lewisham to run Local Welfare Assistance Schemes in 2013/14 and 2014/15. A service level agreement will be set up between Lambeth and Lewisham to cover the transfer of funds between boroughs for this purpose and Lambeth will invoice LB Lewisham on a monthly basis for the goods and services provided to Lewisham residents under the terms of that agreement. Lewisham will also be invoiced for their £17,500 share of the base contract value. The grant for the Lambeth spend is held corporately withinreserves and released through a virement to Revenues and Benefits based on evidenced expenditure to date. The contracting arrangements with Emmaus Lambeth are being managed by officers within the Commissioning cluster in partnership with Revenue and Benefits staff. Recommendations 1. To approve a waiver of 9.2 of the Contract Standing Orders to extend and vary the existing contract with Emmaus Lambeth for providing furniture, white goods and removals for the Emergency Support Scheme for the period 1st April 2015 to 31st March 2017 at a value of up to £485,000 per year. 1. Context 1.1 The Government abolished Community Care Grants and Crisis Loans in April 2013, and the funding for this was transferred to local authorities in the expectation that they would introduce Local Welfare Assistance schemes that would meet the needs that were previously met through central Government provision. The Emergency Support Scheme was established and went live from April 2013. 1.2 The grant allocated to Lambeth was as follows: 2013-14 2014-15 Programme £1.588m £1.588m Admin £335,686 £307,692 1.3 In early 2014 it was announced that the Government plan to end the national funding for Local Welfare Assistance from April 2015. A judicial review was undertaken but was unsuccessful, and a further consultation process is underway at the time of writing. Due to the application levels to the Emergency Support Scheme being lower than anticipated, we have a significant underspend from the grant allocated to us in 2013/14 and 2014/15. This underspend will be used to ensure that the scheme can continue running until the end of 2016/17 without Government funding. 1.4 In addition, the decision has been made to run a shared scheme with the London Borough of Lewisham from April 2015. The shared scheme will be run by Lambeth on behalf of Lewisham from our existing assessment team with the running costs paid by Lewisham under the terms of a service level agreement. Joining the schemes together will accrue modest savings for Lambeth. The decision to run a shared scheme has been subject to extensive discussion with Cabinet members at the Cabinet sub-group on Financial Resilience, and will be approved formally via an ODDR process running concurrently to this one. 1.5 The Emergency Support Scheme contributes to the ‘communities feel safer and stronger’ and ‘more jobs and sustainable growth’ outcomes of the Community Plan, by helping residents to achieve financial security, ensuring older, disabled and vulnerable residents can live independently and have control over their lives, and contributing to improved health and wellbeing. From the outset, the design of the Emergency Support Scheme was co-produced with residents and stakeholder groups as well as going through a thorough consultation process. These processes, and the continued partnership with local charitable organisations, ensure that the scheme delivers a cooperative, community-led response to financial hardship. 1.6 Emmaus Lambeth have been providing furniture, white goods and a home removal service for applicants to the Emergency Support Scheme since it was established in April 2013. 2. Proposal and Reasons 2.1 This report seeks permission to award Emmaus Lambeth a two year contract under waiver to continue to provide furniture, white goods and a home removal service for applicants to the Emergency Support Scheme and to extend this offer to Lewisham applicants. This report requests permission to award the contract under waiver rather than following a competitive procurement process for four reasons: 1. There are no other comparable providers who have the expertise, infrastructure and existing relationships to provide this service effectively and on the scale required, whilst also engaging service users in it’s delivery. Awarding Emmaus this contract ensures that we meet co-operative council outcomes around intermediate labour market opportunities. When deciding to award Emmaus we considered other charitable organisations who sell second hand furniture. It was our view that the other local suppliers (British Heart Foundation) lacked the capacity to deliver the volume anticipated at the time, and Emmaus demonstrated considerable willingness to invest their own funds and secure agreements with partner organisations in order to make the service effective. 2. Emmaus have been providing this service during the first two years of the Emergency Support Scheme, and have consistently achieved monitoring targets, communicated well with staff in Revenues and Benefits and provided an efficient and effective service for residents. 3. In developing the specification for the new shared scheme, politicians and officers from LB Lewisham expressed support for continuing our current arrangements with Emmaus. Our partnership with Emmaus was a key motivator for Lewisham deciding to run a shared scheme with us. 4. The proposed contract with Emmaus represents good value for money. The schedule of rates that we have agreed with them compares very favourably with those charged by commercial suppliers, aided by the fact that Emmaus provide us with good quality second hand goods that have been donated to them by local residents and businesses. Compared to suppliers like the Family Fund (being used by several LAs), Emmaus’s prices are even more competitive. The investment or £35,000 per year in administrative costs is significantly less than we would have to pay if we were meeting applicants, helping them chose items, processing orders and arranging deliveries ourselves. In addition, we have made efficiencies in Emmaus’s administration costs year on year, reducing from £50,000 in 2013/14 to £17,500 per borough in 2015/16. 5. Working with Emmaus adds considerable social value and is an illustration of cooperative commissioning in action. Former homeless people living in their two residential communities in the borough (Norwood and Kennington) work on the scheme. This enables them to sign off benefits and develop their work readiness. Emmaus reinvest all income they make through delivering the scheme into their wider work in the community to support former homeless people and offer low cost furnishings and goods to low income families through their network of shops. 3. Finance 3.1 This report proposes to award Emmaus Lambeth a contract with a base value of £35,000 per annum and up to £450,000 in spot-purchased goods and services. The £35,000 is a fixed sum to cover staffing and other administrative costs. The £450,000 is a fixed upper limit on spend on good and services. We we expect the actual spend to be below this limit. A block funded contract would not be suitable due to the volume of applications and referrals being unknown. 3.2 The contract with Emmaus will be paid using underspend from the previous grants allocated to us by the Department for Work and Pensions in 2013/14 and 2014/15. This funding is held corporately within reserves and will be released through a virement to Revenues and Benefits based on evidenced expenditure. Payment will be released from Revenue and Benefits to Emmaus on a monthly basis on receipt of an invoice. Officers will monitor spend on a month by month basis to ensure that we stay within our annual limit, and make modifications to award criteria and size to manage spend where necessary. 3.3 We will have a service level agreement with Lewisham for the fixed cost elements associated with running the scheme which will include the £17,500 per annum they will pay as their share of the Emmaus contract. This service level agreement will include their obligation to pay the cost of any in-kind awards to Lewisham applicants that Emmaus fulfil under this contract. 3.4 Both contracts contain a clause that allow the contracts to end with three months notice and this allows for future budget uncertainty whilst meeting the need to establish an important and urgent service. There will be no inflationary uplift over the length of the contract and no additional money, or capital, is required for this contract. 3.5 4. Legal and Democracy 4.1 The Council has delegated the authority to award these contracts to the relevant Strategic Director. Before exercising that authority, the approval of the Procurement Board must be obtained. 4.2 The Contract Standing Orders allow officers to waive the requirement to competitively tender contracts valued at £100,000 and more where it can be proven that there is only one provider who can deliver the products or services. 4.3 The Public Procurement Regulations 2006 allow contracting authorities to negotiate contract awards without the publication of a contract notice in OJEU where for technical reasons the contract can only be fulfilled by a particular economic operator. 4.4 This proposed key decision was entered in the Forward Plan on x [date] and the necessary 28 clear days notice has been given. In addition, the Council’s Constitution requires the report to be published on the website for five clear days before the proposed decision is approved by the Cabinet Member. Any representations received during this period must be considered by the decision-maker before the decision is taken. A further period of five clear days - the call-in period – must then elapse before the decision is enacted. If the decision is called-in during this period, it cannot be enacted until the call-in has been considered and resolved. 5. Consultation and co-production 5.1 The relevant cabinet members have been consulted and their views represented as necessary within this report. 5.2 The report has not been sent to the relevant Scrutiny Committee, but the partnership with Emmaus Lambeth that is the subject of this report has been subject to extensive discussion with Cabinet Members at the Cabinet sub-group on Financial Resilience, and their views are represented as necessary within this report. 5.3 The initial design of the Emergency Support Scheme and its partnership with Emmaus Lambeth has been subject to extensive external consultation both formal and informal. A formal eight week consultation was undertaken which involved writing to over 1,000 residents likely to be affected by the changes, holding public meeting and meetin various stakeholder groups. This concluded with broad support for all areas set out for consultation and no changes being deemed necessary to the suggested delivery options. 6. Risk management 6.1 The risks associated with this arrangement with Emmaus Lambeth relates to them not being able to secure enough donated stock to meet the needs of applicants referred to them. We are mitigating this risk by ensuring that the charity has access to a range of suppliers from whom they can obtain required items if their own donated stock is running low. To date, there have been limited occasions where Emmaus have had to deliver purchased stock to applicants, and this has not had a significant impact on the cost of the scheme. Emmaus do not exceed the maximum rates agreed with them. 7. Equalities impact assessment 7.1 A formal Equalities Impact Assessment was completed when the Emergency Support Scheme was initially developed, and was reviewed at the Corporate Equalities Panel in November 2012. This has been reviewed and remains applicable. 8. Community safety 8.1 Emmaus Lambeth engage with former homeless people, many of whom are those maintaining abstinence, in the delivery of this contract. Their service users support the processing and delivery of orders from the Emergency Support Scheme. This contract has also provided them with the capacity to set up a new outlet in a disused councilowned shop premises on an estate in Brixton, and open a community with 27 new bed spaces in Kennington. Both of these initiatives have wider community safety benefits. 9. Organisational implications The following sections must be considered, but are optional and each should be deleted if not relevant to the report. If there are no organisational implications, state “None”. 9.1 Environmental Not applicable. 9.2 Staffing and accommodation No issues. 9.3 Procurement Emmaus Lambeth are a Living Wage employer. 10. Timetable for implementation 10.1 The table below shows the stages, milestones and deadlines for implementing the contract. Item Description Date 1 Published online for call-in period 23.3.15 2 Return signed contract to procurement board administrator 31.3.15 3 Anticipated contract start date 01.4.15 4 Monthly monitoring meetings On-going 5 6-month review of shared Emergency Support Scheme 01.10.15 10.2 Emmaus will send monthly contract performance and financial data to staff in the Financial Resilience Commissioning team for the duration of the operation of the scheme, and will also meet with them on a monthly basis. A dedicated commissioning manager from this team will oversee the contract, working in partnership with key staff within Revenue and Benefits. Audit trail Consultation Name/Position Helen Charlesworth-May Rachel Sharp Mandy Green Sara Hagley Rachel Harrison Michael O’Hora, Legal Wayne Chandai Councillor Paul McGlone Internal Officer Board Procurement Board External Lambeth cluster/division or partner Strategic Director Commissioning Director Associate Director, Commissioning Deputy Head of Revenues and Benefits Business Partnering Enabling: Integrated Support Enabling: Corporate Affairs Cabinet Member: Date of meeting Report history Original discussion with Cabinet Member Report no. Part II Exempt from Disclosure/confidential accompanying report? Key decision report Date first appeared on forward plan Key decision reasons Background information Date Sent 3.2.15 3.2.15 3.2.15 Date Comments Received in para: 3.2.15 10.2.15 11.3.15 3.2.15 3.2.15 3.2.15 11.3.15 4.2.15 9.2.15 4.2.15 18.3.15 19.3.15 27.2.15 9.2.15 N/a No Yes 02/04/15 N/a - Lambeth response to the consultation on cuts to Local Welfare Assistance budget LB Lambeth response Nov 14.docx - Q&A for ESS scheme Lambeth Emergency Support Scheme FAQs.docx Appendices None. APPROVAL BY CABINET MEMBER OR OFFICER IN ACCORDANCE WITH SCHEME OF DELEGATION I confirm I have consulted Finance, Legal, Democratic Services and the Procurement Board and taken account of their advice and comments in completing the report for approval: Signature ______________________________________ Date ________________ Post: Michelle Binfield, Lead Commissioner, Commissioning I approve the above recommendations: Signature ______________________________________ Date ________________ Post: Mandy Green, Associate Director, Commissioning I confirm I have consulted the relevant Cabinet Members, including the Leader of the Council (if required), and approve the above recommendations: Signature ______________________________________ Date ______________________ Post: Cllr Paul McGlone, Deputy Leader and Cabinet Member for Finance and Investment Any declarations of interest (or exemptions granted): Issue Interest declared None None
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