CORPORATE

PROCUREMENT POLICY AND STRATEGY

Revised: April 2011 Next review due: 2014

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FOREWORD It is with great pleasure that I am able to provide a foreword for the Corporate Procurement Policy and Strategy. The Corporate Procurement Policy and Strategy provides a framework for the Council to obtain value in all its procurement activities. The strategy addresses all elements of procurement activity, from identifying the need, considering options, procuring the appropriate goods, services or works, effective supplier and contract management, through to the disposal of assets. The strategy also addresses the many solutions available to the Council, from establishing corporate contracts, using collaborative and consortia arrangements, through to developing long-term strategic partnerships. This strategy continues to provide a clear focus on balancing two priorities: -

Identifying and delivering efficiencies, but not at the expense of quality;

Developing and embracing sustainable procurement. Public sector finance is under significant pressure and procurement has a considerable role to play in reducing the Council’s expenditure. Even in the current climate, I still firmly believe that the above two priorities can continue to be reconciled through adopting a mixed economy approach and evaluating on the basis of whole life costs with due regard to risk. Despite the current economic climate, the Council maintains its commitment to supporting the local economy and improving opportunities for businesses to engage with the Council. The Council’s Contract Procedure Rules have been reviewed and revised. They not only reflect current best practice and legislative changes, but also provide a framework to enable all of the Council’s buyers to demonstrate value for money whilst taking account of sustainability issues. The Contract Procedure Rules and this Corporate Procurement Policy and Strategy are supported by corporate systems that provide guidance and support for all officers of the Council who procure goods, services and works.

David Hunter, Chief Executive

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CONTENTS Executive Summary 3 Strategic Procurement in Context 4 Sustainable Procurement 7 Principles for Effective Procurement 11 Value for Money 16 Performance Management in Procurement 18 Partnerships and Collaboration 19 E-Procurement 20 Code of Conduct for Procurement 21 Risks and Maintaining the Strategy 22 Appendix 1 - Action Plan 23 Appendix 2 – Sustainable Procurement Policy & Flexible Framework 24

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EXECUTIVE SUMMARY This document sets out the Council’s strategic approach to procurement. It is not intended to be a procurement manual, however, the principles contained within the strategy are not optional, and it should be read in conjunction with the Contract Procedure Rules. The Local government Act 1999 places a duty of Best Value on all authorities to secure continuous improvement in the way that functions are carried out, having regard to a combination of efficiency, economy and effectiveness. Effective procurement is crucial in securing high quality, best value public services and the Government has highlighted that the development of a clear procurement strategy is a key step towards achieving Best Value and delivering demanding efficiency targets. This Procurement Policy and Strategy also emphasises the increasing importance of Sustainable Procurement: using procurement to support wider social, economic and environmental objectives, in ways that offer real long-term benefits. Best Value and efficiency targets will not be achieved if the authority fails to approach competition positively, taking full account of the opportunities for innovation and genuine partnerships which are available from working with others in the public, private and voluntary sectors. Importantly, this strategy seeks to balance two priorities:

Delivering efficiencies and quality;

Sustainable procurement, by engaging with local and regional suppliers to promote the local economy and taking account of the social and environmental impact of spending decisions.

A mixed economy and sustainable approach to procurement also relies on developing a collaborative approach to procurement with other Councils and organisations such as the Yorkshire Purchasing Organisation (YPO), Eastern Shires Purchasing Organisation (ESPO), and Officer of Government Commerce (OGC) to achieve economies of scale where appropriate. This strategy provides a corporate focus for procurement. It embraces the Council’s commitment to strategic procurement and set out the Council’s aspirations. It is not a ‘user manual’, and more detail on procurement processes and issues can be found in the Contract Procedure Rules and the Council’s Procurement website.

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STRATEGIC PROCUREMENT IN CONTEXT Strategic procurement is a series of activities and processes that sits at the heart of the Council, providing the framework by which the Council obtains value for money in all of the goods, services and works that it requires. This can be illustrated by the following diagram, which shows the inter-relationship between the role of corporate procurement and the Council as a whole: The term ‘procurement’ relates to the process of acquiring goods, services and works, for example from pens to service delivery partnerships, or from bricks to new roads, and from the initial concept through to the end of the useful life of the asset or service contract. It can also range from the negotiation of corporate contracts for the supply of routine goods and services through to the more complex partnership arrangements such as public/private partnerships (PPP), joint commissioning with other public sector organisations, and construction projects. The Community Strategy and Corporate Plan Effective procurement is crucial to achieve continuous improvement and to securing value for money in public services. The Council is one of the largest purchasers of goods and services in the district, and has both legal and moral responsibilities when making procurement decisions. It is important to ensure that procurement decisions are legal, ethical, in accordance with the policies and procedures of the Council, and that consideration is given to the impact on the economic, social and environmental well-being of the district.

Corporate Priorities

Strategic

Procurement

Elected Members

Senior Management

Purchasing

Department

Stakeholders

Suppliers &

Partners

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The Council’s vision is made up of two parts. The first is the outward facing Council and its many partners’ vision, and the second is the internal vision for the Council. Coordinated and focussed procurement activity enables the Council to proactively contribute to the Community Strategy and the Corporate Plan in a range of areas including:

Strategic Priority Action

Improve Customer Satisfaction: i) Develop our understanding of

customers; ii) Improve our customer approach; iii) Engage and communicate with

our customers.

Addressing and promoting equality and diversity in procurement activity. Providing information about future procurement activity, and advertising tenders on the Council and local Trade Associations’ web sites. Ensure that the Council obtains value for money in the procurement and management of resources, balancing quality and cost. Procurement activity will be transparent, fair, and consistent, and be undertaken to the highest standards of probity and accountability.

Regenerate the area and improve the environment people live in:

i) Enhance green open space within the district for community and leisure use;

ii) Increase public reassurance through community safety initiatives;

iii) Increase pride in the district.

Minimising the environmental impact of the Council’s procurement activity and addressing quality of life issues. Introducing processes which identify the social, environmental, and economic benefits that Council contracts bring to the District. Deliver quality services through well planned commissioning which achieves value for money outcomes for the community.

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Support a vibrant local economy: i) Improve and develop the unique

characteristics of our market towns;

ii) Support our local businesses; iii) Invest in our local area and make

the most of local infrastructure.

Working pro-actively with local business via Trade Associations to explain how to do business with the Council. Engagement with local and regional suppliers from all business sectors e.g. the voluntary and community sector, and Black and Minority Ethnic suppliers. Carrying out Supply Chain work including Meet the Buyer and Meet the Supplier events. Implementing electronic procurement processes to reduce business costs.

Improve the quality of housing and housing choice:

i) Improve the quality of housing and housing choice.

Working pro-actively with local housing providers and local businesses to ensure that there is a supply of quality mixed accommodation that meets the District’s needs.

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SUSTAINABLE PROCUREMENT The Council, along with its policies, is committed to ensuring that services are delivered in a way that protects the quality of the environment and minimises any adverse impact on community well-being. The Council recognises that procurement can be integral in delivering more sustainable outcomes for the District. To achieve this, it is necessary to ensure that environmental and broader sustainability considerations are taken into account throughout the procurement process. “Sustainable Procurement is a process whereby organisations meet their needs for goods, services, works and utilities in a way that achieves value for money on a whole life basis in terms of generating benefits not only to the organisation, but also to society and the economy, whilst minimising damage, or indeed improves the environment”. (Procuring the Future, Sustainable Procurement Taskforce 2006). Put simply, sustainable procurement is good procurement. The Council is working regionally and nationally to develop and promote models of sustainable procurement, and engage with local partners, other public sector organisations, the business community, agencies and the voluntary sector to test these models. It is important to build internal capacity and local knowledge for implementing sustainable procurement, and the Council will seek to address this by providing training to increase awareness and build skills. Specific guidance and good practice on sustainability issues in procurement is included in the Sustainable Procurement Policy and Flexible Framework (Appendix 2). Economic Regeneration The Council is one of the largest spending organisations in the District, and the more money that is spent locally, the greater the positive impact this will have on the local economy, particularly for small and medium sized businesses. The Council has exceeded its original target and increased spend in the regional economy from 40% to 52%, and continues to improve its performance in this area year on year. Procurement legislation limits the Council’s ability to favour local businesses, but there are numerous ways in which it can legitimately support local businesses, including:

Working pro-actively with partners to support local businesses through media and workshops to help explain how to do business with the Council, and to obtain their feedback in order to improve documentation and processes.

Providing information about future procurement activity, and advertising tenders on the Supplier and Contract Management System being developed.

Running supplier engagement events.

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Packaging contracts in a manner, wherever possible, that does not preclude the following from tendering:

Local and regional companies;

Small and medium sized enterprises;

Newly formed businesses;

The voluntary and community sector;

Using purchasing cards to procure low value goods (often through local outlets).

The challenge for procurement is to balance the following conflicting priorities:

Obtaining value for money and the required quality;

Sourcing locally wherever possible within the legislative framework;

Procuring in a sustainable way with regard to environmental, social and economic factors; and

Reducing the number of low value creditors (especially those where annual spend is less than £1,000).

Social Development The Council has a role to play in addressing social impact and cohesion across the District. Social benefits range from the creation of employment and training opportunities to the elimination of child labour in the supply chain. The Council recognises and values the added benefits that the voluntary, community and social enterprise sectors can provide. In order to inform buyers of opportunities that may be provided by the sector, the Council has supported the Bassetlaw Community and Voluntary Sector (BCVS) in developing an on-line resource that maps the potential of the voluntary sector and social enterprises. (Please refer to www.bassetlaw.gov.uk). Council policy is that for procurement of less than £15,000 in value, this site should be used, where appropriate, to source potential voluntary sector suppliers and invite them to quote. In addition, all procurement processes exceeding £10,000 in value should be placed on the Supplier and Contract Management System, when developed. The Council will encourage ‘supported businesses’ i.e. organisations where 50% or more of their workforce are disabled, through its procurement processes by reserving contracts to supported businesses where appropriate. Where relevant to the subject matter of the contract, the suppliers/contractors approach to tackling unemployment and creating training and apprenticeship opportunities should be incorporated into the procurement process. Furthermore, the Council is continuing to work with the supply chain to continually seek improvement and to address ethical issues, for example, adopting the use of the Fair Trade products and supporting local suppliers.

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Environmental Management The approach to sustainable procurement reflects the corporate approach to sustainability, and is guided by the priorities in the Community Strategy. Specific guidance on sustainability issues in procurement is available on the Council’s procurement website. The Council has worked with other Councils and agencies to establish and promote minimum recycled content standards for products used in construction, highways maintenance, estates management and all printed matter. In 2006 the Council’s Cabinet agreed a policy that all construction, refurbishment and

maintenance work is carried out to minimum environmental standards. The Council

signed up to the Nottingham Declaration in 2007 making a firm commitment to reduce its

CO2 emissions.

Since this time the Council now has in place a Climate Change Strategy which

addresses all key factors of sustainable development, as well as workplans that relate to

carbon management, climate change reduction activities and future visions of the

Council.

The Council is aware that public perception of sustainability issues has grown immensely

through focused media attention on climate change, flood defences, waste and

recycling, and as such is delivering outcomes that support sustainable development.

Procurement in the Council plays a key role in contributing to sustainable development,

through the buildings, goods and services it chooses to purchase. With this in mind the

Council recognises it has a vital role in furthering sustainable development and is

endeavouring to take into account the wider issues of sustainable procurement by:

Reducing CO2 emissions produced through Council operations, recycling and

reducing domestic waste;

Achieving savings for the Council through spend to save and energy efficiency

projects that deliver long term value for money for the Council and the public

sector as a whole;

The installation of renewables and the creation of green energy;

Making more efficient use of resources e.g. the re-use and recycling of materials

in capital projects giving rise to reduced energy consumption;

Leading by example and continuing to demonstrate our commitment to

sustainable development;

Considering the costs and benefits of environmentally-preferable goods and

services as alternatives;

Ensuring that vehicles purchased have low emissions of greenhouse gases

(GHG’s), and take into consideration the need to reduce emissions and air

pollution.

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The Council recognises that further work is to be done on sustainable procurement and

is endeavouring to raise awareness throughout the Council and the general public. It

also intends to promote awareness with its contractors by embedding sustainability into

engineering contracts and optimising use of resources. It is building good relationships

with other Councils, in order to seek shared opportunities and benefits. It has adopted

mechanisms and indicators to monitor and review energy reductions and savings, and to

monitor progress in a clear and transparent manner.

Equally important, the Council will apply procedures for the proper management and disposal of assets to ensure both value for money, and to minimise any adverse impact on the environment. Equality and Cohesion Sustainable procurement also includes the duty to ensure that equality and cohesion is addressed in all procurement activity, irrespective of whether provided from within the Council or indirectly through another organisation. The Council is addressing this through:

Building equality and diversity terms and conditions into standard procurement documents;

Providing workshops and written guidance for potential and existing bidders that include demonstrating the business case for equality and diversity;

Providing workshops to assist Council officers in addressing equality and cohesion in procurement activity, including undertaking Comprehensive Impact Assessments (CIAs) that include equality and diversity at the start of the procurement process to build equality and diversity requirements into contracts where it is deemed relevant to do so;

Monitoring contracts in respect of the undertaking of Comprehensive Impact Assessments through the use of risk logs;

Monitoring compliance against equality and diversity requirements in contracts;

Raising awareness and making plans to address the requirements of the Equality Act 2010.

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PRINCIPLES FOR EFFECTIVE PROCUREMENT The following principles will form the basis of all procurement activity in order to achieve value for money:

Strategic procurement will support improved service delivery through the freeing up of resources and improving the quality of goods, services and works;

Strategic procurement will ensure that the Council obtains value for money in the acquisition and management of its resources, balancing both quality and cost;

The Council will undertake all procurement activity within a corporate framework to enable all officers to obtain goods, services and works to the required quality in the most efficient manner;

All procurement activity will be sustainable, supporting and promoting Council policies and priorities, including equal rights, sustainability, social cohesion and economic regeneration;

The Council will ensure that procurement activity is undertaken in the most effective and appropriate manner. This should consider, amongst others, the following:

- Develop, promote and enforce the use of corporate contracts;

- Use consortia (for example, YPO, ESPO and Buying Solutions);

- Use approved nationally negotiated contracts (for example those arranged by Buying Solutions);

- Use approved e-procurement solutions (for example purchasing cards etc.);

- Collaborative procurement with other Councils and organisations;

- Develop strategic partnerships, particularly where these will deliver significant service improvement and/or efficiencies.

All procurement activity will be assessed on a whole-life costing and benefits basis with due regard to risk.

Procurement activity will be transparent (and fully compliant with the Freedom of Information Act), fair and consistent, and be undertaken to the highest standards of probity and accountability. Procurement decisions must be evidence based.

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The Council will manage strategic procurement through its Procurement Team. Centralised purchasing will operate within the team to complement the existing and future contracts. It will be a corporate resource which leads on letting corporate contracts and supporting projects. It will provide support wherever required to departmental purchasing and contracting officers, and monitor procurement activity across the Council. The service will comprise a small team of skilled and experienced officers, and the activity of the service will be predicated on maximising benefits for the Council overall. The training and development needs of all officers buying for the Council will be monitored, and the Procurement Team will maintain a list of all officers that buy for the Council to ensure that they are informed of all new corporate contracts and developments in procurement. It is important that procurement is seen and managed as a component of the commissioning cycle, illustrated in the following diagram:

Strategic

Framework

and

Corporate

Priorities

Procure

Solutions

Monitor and

Review

Prioritise

and Plan

Options

Appraisal

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Strategic Framework and Corporate Priorities: Procurement activity will operate within a strategic framework consisting of this Corporate Procurement Policy and Strategy, the Contract Procedure Rules and the Council’s Constitution. Procurement activity must be carried out in a manner which supports the Council’s strategic priorities and the Community Strategy, including contributions to customer satisfaction, regenerating the area and improving the environment, supporting a vibrant economy, and improving the quality of housing and housing choice. Prioritise and Plan: Strategic procurement activity will be planned over a three-year cycle with detailed annual plans. It will be undertaken in a performance management environment and will prioritise areas of activity that will generate significant savings or improved quality, and/or contribute to corporate priorities and service improvements. Localised service procurement activity should also be planned in order to avoid ‘panic’ buying and ensure that the service optimises its supply of all necessary goods and services. Good planning will allow common areas of spend across the Council to be aggregated in order to obtain economies of scale and secure value for money. Options Appraisal: Best Value requires the Council to demonstrate economy, efficiency and effectiveness of service delivery. Procurement decisions need to be taken, such as whether it is necessary to obtain good service or works, and whether they should be obtained internally or externally. Decisions also need to be made as to the most appropriate route to procure goods, services and works to ensure that the Council achieves value for money. Option appraisals will include alternative models of service delivery, including shared services with other public sector organisations, outsourcing of services and collaborative opportunities. Procure Solutions: The actual procurement process will depend upon the required outcomes, but a typical process is illustrated in the diagram below. In all cases the process must comply with the Council’s Contract Procurement Rules and the Council’s Constitution. Monitor and Review: The monitoring and management of contracts is a critical factor, and can make the difference between a successful contract and a failed one. Contractual arrangements should be effectively managed and monitored throughout the contract duration. Where appropriate, contracts should include quality and performance standards which are monitored and reviewed. Contracts will be subject to continual review and supplier/contractor appraisal exercises. Benchmarking can be undertaken on a planned basis in liaison with both public and private sector organisations to measure the effectiveness of procurement decisions. A good working relationship should be developed with suppliers, and liaison meetings with major suppliers will be held at suitable intervals. Plans should be made well in advance of the expiry of a contract for re-letting it, based on a review of previous and current arrangements and performance.

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Diagram: Typical Procurement Process Procurement Analysis The choice of procurement method will be dependent on the strategic importance, the value of the goods, services or works, and the potential risk associated with each procurement option. Different procurement options will be suitable for different goods and services and will involve undertaking different practical steps to achieve the desired outcome. The Council will develop its overall management of procurement by modelling its requirement on a risk/value matrix, illustrated below. Equally, individual procurement decisions should also be considered on their own merits following an appraisal of the suitable procurement options. It is important that the option selected is the one most likely to deliver optimum value for money for the Council and its citizens, and tenders should thus be evaluated using a balanced scorecard evaluation model.

Identify Requirements & Associated Risks With

Key Stakeholders

Specify Goods/ Services/Works

Required

Market Analysis/ Review Potential

Procurement Options

Undertake Selected Procurement Method

Contract/Relationship Management

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Procurement Analysis Model

RISK

BOTTLENECK

High risk/low value procurement may be critical for service delivery and source is not easily replicated. Examples include:

Raw materials

Insurance The priority for high risk/low cost items is to ensure continuous supply. Price is not important whereas supply failure could be dramatic.

STRATEGIC

High risk/high value procurement is complex and specialist and critical to delivery of services to the public. Examples include:

Property construction and maintenance

Highways construction and maintenance High risk/high cost items call for close management of the suppliers since any failure would have extensive repercussions for the delivery of services. It is in this area that highly skilled procurement staff should be used from the outset to ensure that contracts are fit for purpose, that selection criteria underpin the business need, and to seek out innovative solutions.

ROUTINE

Low risk/low value procurement. Examples include:

Stationery and office supplies

Furniture and fittings

Cleaning, janitorial and hardware

Advertising

Plant, tools and machinery Minimise time on low risk/low cost items by using long term contracts and combining with other buyers, perhaps using their contracts.

LEVERAGE

Low risk/higher value procurement. Examples include:

Consultancy and specialist services

Utilities and fuels

IT equipment and services

Telecommunications

Agency staff

Food and drink

Landscaping and grounds maintenance

Design, print and promotional

Vehicle supplies and services

Financial and legal services High cost items, in those markets where there are plenty of suppliers, provide an opportunity for the buying organisation to leverage its purchasing power to obtain financially attractive deals. This calls for buyers with extensive market knowledge or collaboration across organisations.

VALUE

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VALUE FOR MONEY The Council remains committed to achieving Value for Money in order to demonstrate economy, efficiency and effectiveness of service delivery. Procurement decisions such as whether to continue to provide the goods, services or works, and whether to provide them internally or externally are central to this requirement. It is essential that the Council not only adopts processes to secure best value, but can evidence the efficiencies obtained to demonstrate delivery of national efficiency targets arising from, for example, Comprehensive Spending Reviews and national indicators. The ability to radically re-think and re-shape the way the Council undertakes procurement and secures continuous improvement is key. Achieving procurement efficiency savings requires a combination of: -

- Reducing prices;

- Reducing purchasing transaction time for contracts and major projects;

- Eliminating/automating processes;

- Managing risks better;

- Improved contract management post award. Our approach for procurement efficiencies is therefore: -

- Driven by optimising outputs and results;

- Driving down the cost of goods and services procured by the Council balancing quality and cost;

- Responding promptly and effectively to service and citizen requirements;

- Minimising administrative processes and unnecessary bureaucracy;

- Ensuring simple or routine transactions can be carried out in the most efficient manner;

- Considering all options in obtaining the most appropriate solution;

- Valuing innovation and creativity;

- Using competition to obtain best value;

- Proactively supporting the Council’s policies and priorities;

- Complying with legislation;

- Being transparent and accountable;

- Working in collaboration with other public sector organisations and government frameworks (e.g. OGC Buying solutions) in order to achieve value for money and maximise economies of scale for routine supplies.

In order to demonstrate value for money, the following is built into procurement activity:

Performance indicators and targets (based on both quality and cost) are established as part of procurement processes;

Procedures to manage contractual arrangements are established with performance measured and reported, including benchmarking arrangements;

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Procurement procedures and processes are regularly reviewed;

The management of risk is an integral part of the procurement process;

The Council invests in procurement training and systems to support the procurement process.

The Council values in-house providers that demonstrate quality and value for money. Unless otherwise approved by the relevant Head of Service/Director, external businesses will not be used where the Council has its own in-house services. Should the Council take a decision that an in-house service be exposed to competition, it will undertake this in an open and fair manner, and ensure that:

Staff and their representatives are fully and properly consulted;

Appropriate outcomes, performance standards and monitoring processes are developed;

All information required for a due diligence process is identified and collected;

Innovation is encouraged;

Relevant Council policies and priorities are incorporated into any specification;

Probity, accountability and competitive neutrality is ensured and conflict of interest is avoided or managed;

The responsibilities and accountabilities of all parties are explicit. A key objective of this procurement strategy is to provide a means to improve quality and efficiency by harnessing competition. This can be through either:

Indirect competition e.g. via benchmarking, market testing or external challenge. The Council will assess the competitiveness of different functions by reference to other Councils and organisations. In addition to comparing performance, this provides a vehicle for individual and organisational development, learning from experience and good practice.

Direct competition i.e. alternative means of procurement. The Best Value review process will enable the Council to consider whether alternative means of procurement or service delivery is appropriate.

Consultants: The Council will have an ad-hoc requirement to use external consultants and advisors to provide specialist advice and services not available within the Council and to provide support and challenge for major projects. The procurement, utilisation and management of consultants (and assessment of the resulting required outcomes) should be managed in accordance with the guidance issued in this Policy, the Contract Procedure Rules, and the Constitution.

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PERFORMANCE MANAGEMENT IN PROCUREMENT Procurement activity, like all other Council activities, should be undertaken in a performance management environment. Procurement influences the attainment of some national performance indicators. The Council uses a range of national and local indicators to measure its performance in procurement activity, and the Head of Finance and Property is required to report progress against performance indicators on a quarterly basis. Key issues to consider in respect of performance management include: Efficiency: Ensuring that we are driving down the cost of the goods, services and works we procure without compromising quality. Contracts approaching an optional extension period are an ideal opportunity to reduce costs with existing suppliers. Our contracted supplier can often suggest ways for the Council to make savings so Contract Officers should be in constant dialogue with their suppliers to ensure costs are kept to a minimum. Planning: Planning annual procurement activity in advance will enable officers to undertake procurement in a more structured manner, identify options and prepare properly. Specifications: Where possible, specifications should include measurable outputs or outcomes, performance standards or other appropriate measures by which the contract can be assessed. Contract Management: This a major factor in the success or failure of a contract. All contracts should have an associated officer with responsibility for monitoring and managing the contract, including the development of relationship management. Risk Based Approach to Procurement: Risk will be managed throughout the procurement cycle to ensure that risks are identified and managed by the most appropriate stakeholder. Risk Registers shall be prepared for all major procurement processes in accordance with the Contract Procedure Rules and the Project Management Guidelines. They will be revisited on the achievement of each key milestone in the procurement process, and throughout the life of the contract. Review: It is important that lessons are learned (what went well, what didn’t go well), in order to inform future procurement decisions. Problems encountered in a project should be fed into risk analysis models for future projects. Training and Development: The key to delivery of effective public sector procurement requires people who are suitably trained and qualified to provide the necessary ‘professional’ input. This ranges from a formal procurement qualification and wide experience, to knowledge of basic procurement techniques. The level of expertise required depends on the frequency and complexity of the procurement activity. Project Management: Any project which involves significant risk will be managed in an appropriate manner using the adopted Project Management Guidelines, and regular progress reports will be provided to the Corporate Management Team at key milestones. The Contract Procedure Rules require that all projects valued over £100,000 should be the responsibility of an officer who is experienced in managing major projects.

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PARTNERSHIPS AND COLLABORATION The Council acknowledges the importance of partnerships in delivering services. It already benefits form a range of partnerships with private, public and voluntary organisations. The process of carrying out fundamental performance reviews will foster an open and constructive dialogue with all those involved or who may have something to contribute, be it from within the Council itself, or through partnership arrangements with the private and/or voluntary sectors. The Council will encourage the development of new methods or approaches to procurement that will deliver services more efficiently, effectively and economically. The Council currently delivers a limited range of services via the Voluntary and Community Sector. This is an area of potential growth that requires further support and development, and the Council will implement the good practice guidance published by the Home Office of Government Commence „think smart…think voluntary sector‟ (2004), and support social enterprises. In specific instances (subject to the evidence of a robust business case), a properly procured and managed strategic service delivery partnership can deliver ways in which the Council can realistically achieve step-changes in service quality. Strategic partnering can provide access to new skills, resources and ways of doing things and allow for innovation and the pursuit of difficult or long-term goals. Partnerships can provide access to investment, skills and new opportunities that the Council is unable to acquire alone. The Council is committed to exploring all options in order to provide the quality services required for now and in the future.

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E-PROCUREMENT E-Procurement is ‘doing business’ electronically. All purchase orders should be placed using centralised purchasing ‘procure to pay’ where available. The benefits of e-procurement include:

Deliver savings through streamlining the internal procurement procedures and processes;

Provide a framework to ease the ordering of goods, services and works whilst maintaining compliance with legislation;

Improve services (for example, the use of purchasing cards can speed up the process of obtaining materials for maintenance work).

The Council adopts a comprehensive set of e-procurement solutions that include:

The introduction of a centralised purchasing ‘procure to pay’ solution across the Council to streamline the process from initial requisition through to the payment of the invoice. The system is fully integrated with the Council’s financial system and operated via the Procurement and Corporate Accountancy teams;

The Supplier and Contract Management System for the full tender and quotation process, including e-tendering;

Purchasing Cards for low value spot purchases;

E-auctions where appropriate in conjunction with other Nottinghamshire authorities.

Advancements in technology are eliminating unnecessary costs from the procurement process, and releasing resources to be utilised more efficiently elsewhere. An integrated procure-to-pay process across the Council will deliver real savings and improved management information. E-procurement also allows authorities to work collaboratively to achieve economies of scale and shared expertise and knowledge. The Council is an active partner in the Nottinghamshire project for the regional web-based Supplier and Contract Management System to manage contracts, i.e. Proactis (including performance information). It will identify collaborative opportunities, streamline the procurement process, and further enhance the use of e-tendering.

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CODE OF CONDUCT FOR PROCUREMENT All procurement activity must be undertaken to the highest standards of ethics and probity. The Council insists on ethical standards from its suppliers, and in turn it must exhibit the highest ethical standards itself. Officers and Members must not only be fair and above board in all business dealings, but should also avoid any conduct that is capable of having an adverse interpretation put on it. All employees must adhere to the Bribery Act 2010, the Officers’ Code of Conduct, and the Protocol for Employees on Gifts and Hospitality. In addition, employees undertaking any purchasing activity should consider themselves bound by the Code of Ethics of the Chartered Institute of Purchasing & Supply.

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RISKS AND MAINTAINING THE STRATEGY Risks The main risks that could prevent the Council from achieving the benefits from effective procurement include:

Using unreliable data as the basis for procurement decisions;

Lack of support from managers for corporate buying and non-adoption of standard documents and processes;

Non-compliance with corporate contracts resulting in not achieving potential savings;

New procurement processes, documents and standards are unworkable and non-compliant;

Procurements have an adverse effect on local suppliers. It is anticipated that the actions identified in this strategy will mitigate against the impacts of these main risks. Specific risks to individual procurements will be identified as part of the procurement project. Maintaining the Strategy The Corporate Procurement Policy and Strategy (2011 – 2014) will be owned by and updated through the Procurement Working Group. The Action Plan will be updated annually to reflect changing priorities and developments in procurement legislation and best practice.

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APPENDIX 1 - ACTION PLAN

Action Title Action Description

Due Date

Managed By

Assigned To

To update and publish the contracts register.

To have a complete list of contracts and relevant expiry dates to enable further work programmes to be developed.

May 2011

Head of Finance & Property

Procurement Manager

To refresh the Corporate Procurement Policy and Strategy.

To produce an updated strategy that meets modern requirements.

May 2011

Head of Finance & Property

Procurement Manager

To examine current contracts against spend to identify new procurement opportunities.

To identify opportunities for negotiating new contracts and save money.

Sept 2011

Head of Finance & Property

Procurement Manager

To improve the website in relation to procurement documentation.

To provide external suppliers a unified approach to procurement activity with the Council.

Sept 2011

Head of Finance & Property

Procurement Manager

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APPENDIX 2 – SUSTAINABLE PROCUREMENT POLICY AND FLEXIBLE FRAMEWORK

BASSETLAW DISTRICT COUNCIL

SUSTAINABLE PROCUREMENT POLICY

The Council recognises that it has a vital role in furthering sustainable development, through its procurement of buildings, goods, works and services. Procurement decisions have a major socio-economic and environmental implication, both locally and globally, now and for future generations. The Council will therefore strive to: People, Education and Awareness

Educate, train and encourage internal procurers and commissioners to review their consumption of goods/services, reduce usage and adopt more environmentally friendly alternative products;

Communicate the sustainable procurement policy to all staff, suppliers/contractors, Members and other stakeholders.

Policy, Strategy & Communications

Consider the costs and benefits of environmentally preferable goods/services as alternatives;

Investigate the impact of the Council’s expenditure on goods and services, via purchase spend analysis, to identify potential environmental impacts;

Investigate opportunities for the recycling and re-use of materials where appropriate;

Assess the environmental and corporate risks to the Council with a commitment to continually improve sustainable performance that relates to the supply chain;

Work in partnership with other organisations, such as buying consortia to improve sustainable procurement.

Procurement Process

Promote best practice for sustainable procurement;

Ensure that where appropriate, suppliers’ environmental credentials are, as far as legally practicable, considered in the supplier evaluation process and that environmental criteria are used in the award of contracts;

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Ensure that consideration is given to inclusion, within all specifications, of a facility for suppliers/contractors to submit offers for environmentally friendly alternatives;

Specify, wherever possible and practicable, the use of environmentally friendly goods.

Engaging Suppliers

Ensure that low value and OJEU contract opportunities are made available via local advertising;

Address barriers to entry in order that Small and Medium Sized Enterprises (SMEs), local suppliers and the voluntary sector are encouraged to bid for the Council’s business;

Educate our suppliers regarding the Council’s environmental and sustainability objectives;

Encourage and persuade suppliers/contractors to adopt environmentally friendly processes and supply environmentally friendly goods/services;

Work with key suppliers/contractors to make changes and thereby extend sustainability improvements throughout the supply chain.

Measurements and Results

Comply with all relevant environmental, health & safety, diversity, disability and employment legislation;

Meet the targets as set out by the Sustainable Procurement Task Force and the National Action Plan.

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BASSETLAW DISTRICT COUNCIL

THE FLEXIBLE FRAMEWORK

THE FLEXIBLE FRAMEWORK

Foundation Level 1

Embed Level 2

Practice Level 3

Enhance Level 4

Lead Level 5

People Sustainable procurement champion identified. Key procurement staff have received basic training in sustainable procurement principles. Sustainable procurement is included as part of a key employee indication programme.

All procurement staff have received basic training in sustainable procurement principles. Key staff have received advanced training on sustainable procurement principles.

Targeted refresher training on latest sustainable procurement principles. Performance objectives and appraisal include sustainable procurement factors. Simple incentive programme in place.

Sustainable procurement included in competencies and selection criteria. Sustainable procurement is included as part of employee induction programme.

Achievements are publicised and used to attract procurement professionals. Internal and external awards are received for achievements. Focus is on benefits achieved. Good practice shared with other organisations.

Policy, Strategy and Communications

Agree overarching sustainability objectives. Simple sustainable procurement policy in place endorsed by CEO. Communicate to staff and key suppliers.

Review and enhance sustainable procurement policy, in particular consider supplier engagement. Ensure it is part of a wider Sustainable Development strategy. Communicate to staff, suppliers and key stakeholders.

Augment the sustainable procurement policy into a strategy covering risk, process integration, marketing, supplier engagement, measurement and a review process. Strategy endorsed by CEO.

Review and enhance the sustainable procurement strategy, in particular recognising the potential of new technologies. Try to link strategy to EMS and include in overall corporate strategy.

Strategy is: reviewed regularly, externally scrutinised and directly linked to organisation’s EMS. The Sustainable Procurement strategy recognised by political leaders, is communicated widely. A detailed review is undertaken to determine future priorities and a new strategy is produced beyond this framework.

Procurement Process Expenditure analysis undertaken and key sustainability impacts identified. Key contracts start to include general sustainability criteria. Contracts awarded on the basis of value-for-money, not lowest price. Procurers adopt

Quick Wins.

Detailed expenditure analysis undertaken, key sustainability risks assessed and used for prioritisation. Sustainability is considered at an early stage in the procurement process of most contracts. Whole-life-cost analysis adopted.

All contracts are assessed for general sustainability risks and management actions identified. Risks managed throughout all stages of the procurement process. Targets to improve sustainability are agreed with key suppliers.

Detailed sustainability risks assessed for high impact contracts. Project/contract sustainability governance is in place. A life-cycle approach to cost/impact assessment is applied.

Life-cycle analysis has been undertaken for key commodity areas. Sustainability Key Performance Indicators agreed with key suppliers. Progress is rewarded or penalised based on performance. Barriers to sustainable procurement have been removed. Best practice shared with other organisations.

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THE FLEXIBLE FRAMEWORK

Foundation Level 1

Embed Level 2

Practice Level 3

Enhance Level 4

Lead Level 5

Engaging Suppliers Key supplier spend analysis undertaken and high sustainability impact suppliers identified. Key suppliers targeted for engagement and views on procurement policy sought.

Detailed supplier spend analysis undertaken. General programme of supplier engagement initiated, with senior manager involved.

Targeted supplier engagement programme in place, promoting continual sustainability improvement. Two way communication between procurer and supplier exists with incentives. Supply chains for key spend areas have been mapped.

Key suppliers targeted for intensive development. Sustainability audits and supply chain improvement programmes in place. Achievements are formally recorded. CEO involved in the supplier engagement programme.

Suppliers recognised as essential to delivery of organisation’s sustainable procurement strategy. CEO engages with suppliers. Best practice shared with other/peer organisations. Suppliers recognise they must continually improve their sustainability profile to keep the clients business.

Measurement and Results

Key sustainability impacts of procurement activity have been identified.

Detailed appraisal of the sustainability impacts of the procurement activity has been undertaken. Measures implemented to manage the identified high risk impact areas.

Sustainability measures refined from general departmental measures to include individual procurers and are linked to development objectives.

Measures are integrated into a balanced score card approach reflecting both input and output. Comparison is made with peer organisations. Benefit statements have been produced.

Measures used to drive organisational sustainable development strategy direction. Progress formally benchmarked with peer organisations. Benefits from sustainable procurement are clearly evidenced. Independent audit reports available in the public domain.