Agenda item

Agenda item

Risk Review Item: Contract Management and Governance

The report of the City Treasurer is enclosed.

Minutes:

The Committee considered the report of the City Treasurer that summarised progress against the actions set out in the contract management improvement work plan approved by the council’s Senior Management Team on 27 February and the recommendations of the Audit Committee in January 2018.

 

The Head of Integrated Commissioning introduced the report, stating that a great deal had been achieved in the last seven months in relation to governance, monitoring and accountability, with notable progress on completion and analysis of contract registers, the development of standard products and processes, and growing awareness and tools for monitoring social value in contract delivery.

 

The Head of Integrated Commissioning stated that work was also ongoing with health partner in the Manchester Health and Care Commissioning (MHCC) and the Local Care Organisation, however the scale and complexity of the challenge should not be underestimated, given the number, value and variety of external contracts, the Council’s ambition for delivering for Manchester residents, and the pressing need to maximise value for money. The report noted that this was a long-term improvement programme, and there remained much work to be done. 

 

A member commented that she welcomed the establishment of a standard contract register as a mechanism for the efficient monitoring of contracts. She commented that this would enable conversations to be had with local, smaller suppliers to encourage them to bid for contracts noting that it was important that barriers to doing this needed to be removed. The Head of Integrated Commissioning stated that this was being undertaken as the new model supported this approach.

 

In response to Members questions the Head of Integrated Commissioning informed the Committee that she would circulate the figures of how many contracts existed per Directorate and information on those contracts that were rated as either Gold, Silver or Bronze as assessed for their criticality. The Chair welcomed this, noting that this may inform future work of the Committee and if necessary the Committee may wish to consider referring matters to the appropriate Scrutiny Committee.

 

A Member requested further information on the Directorates that would develop forward commissioning pipelines on the basis of risk and criticality, and reflect in service and budget plans, with first drafts to be completed by December 2018, to be combined in City Council and MHCC forward planning. The Head of Integrated Commissioning said that this would be shared with Members, mindful that some information was commercially sensitive and advice on this would be provided.

 

The City Treasurer responded to comment from a Member regarding staff training to manage contracts noting that the Council currently commissioned and procured over £0.5bn of services from third parties, the scale of which illustrates the importance of this function by saying that this has been identified as a priority workforce development and funding had been identified to deliver staff training.

 

In response to a question from the Chair the Head of Integrated Commissioning confirmed that the reported £0.5bn was for the procurement of a variety of services, such as homecare, highways and children’s’ services for example and not capital expenditure and was an annual figure. The Chair commented that this was a significant amount of money and highlighted why this activity was so important.

 

A Member asked how much money was being saved currently and what future saving would be realised by delivering this approach to commissioning and contract management. The Head of Integrated Commissioning said that work was ongoing with each Directorate so that they are prepared for the re procurement of services and the awarding of new contracts and commented that any savings achieved would be retained by the relevant service Directorate budget. She said that work was ongoing to prioritise high risk areas and opportunities for achieving savings from existing contracts were being explored. She said savings would be achieved long term through a more robust, timely and efficient monitoring and management of contracts. She made particular reference to the Neighbourhoods Directorate who had embraced and developed a very good model to review their contracts that would be shared with other Directorates to support them with this activity and influence behaviour change.

 

In response to a question asked by the Chair the Head of Integrated Commissioning reported that those contracts that had been identified for priority review were as a result of them being because they were time sensitive or had been identified by the Senior Management Team to achieve specific strategic objectives. She said priorities would be reviewed each year taking into consideration budget priorities and strategic plans.

 

The Chair noted the reported progress and requested that future update reports on this important area of work contained examples.

 

Decision

 

To note the report submitted.

Supporting documents: