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BOROUGH OF PENDLE

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					REPORT OF:              Housing and Community Services Manager

TO:                     Executive

DATE:                   17th October 2002


           GAS MAINTENANCE CONTRACT
         REPLACEMENT HEATING CONTRACT
             PARTNERING PROPOSAL

1.      PURPOSE OF THE REPORT

1.1     The purpose of this report is to secure approval in principal from the
        Executive to the establishment of a partnering contract in relation to the
        gas maintenance and replacement heating contracts.

2.      ISSUE

2.1     It is Government policy that all councils modernise their procurement
        arrangements to make sure that contracts are awarded on best value
        principals i.e. not based necessarily on the lowest price tenders.

2.2     The Egan and Byatt reports, commissioned by both this and previous
        Governments, set out a national procurement framework to assist local
        councils modernise their procurement processes. In addition the Office of
        the Deputy Prime Minister has recently issued policy guidance to local
        authorities to assist with the development of local procurement strategies.

2.3     Pendle Borough Council is currently in the process of undertaking a best
        value review of its procurement arrangements in partnership with the
        District Audit service. This work will lead to the development of a new
        procurement policy for the Council.




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2.4   One of the new main procurement options available to local councils,
      under the modernising agenda, is the development of partnering contracts
      rather than contracts based around competitive tendering. A typical
      partnering model is set out at Appendix

2.5   The Council entered into a contract in 1999 with APS Heating in relation
      to the routine maintenance and servicing of gas appliances in Council
      houses. The contract was won by APS through a competitive tendering
      process and is worth approximately £160,000 per annum. The contract
      runs until 2004.

2.6   In addition the Council has a budget of £200,000 per annum which it uses
      to fund the replacement of outdated or obsolete heating appliances. APS
      Heating along with a number of other contractors compete for work under
      this programme through a competitive tendering arrangement.

2.7   Housing and Community Services wish to pilot a partnering arrangement
      on behalf of the Council for both gas maintenance and obsolete heating
      contracts.

2.8   The proposal is that the Council enter into a 3 year partnering
      arrangement for:

      1.     The maintenance and servicing of all gas appliances within Council
             houses.

      2.     The replacement of all obsolete heating systems through the
             planned maintenance programme.

      3.     APS would be the selected partner for this arrangement (the
             contractor has already agreed in principle to give up the existing
             competitively tendered contract if a suitable partnering
             arrangement can be agreed between the parties).

2.9   The total value of the contract would be £930,000 over 3 years.

3.    POLICY IMPLICATIONS

3.1   The implementation of partnering contracts is a key requirement of
      Government policy. In approving this proposal the Council will be able to
      demonstrate a move forward in the modernisation agenda as it relates to
      procurement.

4.    LOCAL AGENDA 21 IMPLICATIONS

4.1   There are no Local Agenda 21 implications.




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5.       COMMUNITY SAFETY IMPLICATIONS

5.1      There are no Community Safety implications.

6.       FINANCIAL IMPLICATIONS

6.1      The cost of meeting the works associated with the partnering contract
         would be met from resources within the Housing Revenue Account.

7.       CONCLUSIONS

7.1      The development of a partnering arrangement for the gas maintenance
         and replacement heating contracts helps the Council meet Egan targets
         as set out in the Housing Strategy and Business Plan.

8.       RECOMMENDATION

8.1      It is recommended that Executive:

         1.      Agree in principle to the establishment of a partnering
                 arrangement to cover both gas servicing and replacement heating
                 contracts for a period of up to 3 years.

         2.      Agree to APS Heating being the selected partner to participate in
                 this pilot arrangement.

         3.      Request the Housing and Community Services Manager to bring
                 forward detailed arrangements to the Executive for approval prior
                 to the formal signing of the partnering agreement.

9.       REASONS FOR RECOMMENDATION

9.1      It is essential that the Council can demonstrate a modern approach to
         procurement in order to assist with securing a good rating under the
         Comprehensive Performance Assessment framework.

10.    BACKGROUND PAPERS

10.1     The following background papers have been used in the preparation of
         this report:

         1.      The Egan Report

         2.      The Byatt Report




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11.     AUTHOR

Author:      Ian Broughton Housing and Community Services Manager
Tel:         (01282) 661174
E-Mail:      ian.broughton@pendle.gov.uk
Town Hall,
NELSON,

Ref:         egan_1.doc
Date:        23rd September 2002




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