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Agenda Item No

 

The Vale of Glamorgan Council

 

Scrutiny Committee (Corporate Resources): 19th February 2013

 

Report of the Director of Visible Services and Housing

 

Fleet Procurement Delays 2011/12

 

Purpose of the Report

1.             To advise Scrutiny Committee of the reasons for the delays in the Fleet procurement process during 2011/12 and 2012/13.

Recommendations

1.             That the position with regard to the Council's Vehicle Replacement programme be noted.

Reasons for the Recommendations

1.             To advise Scrutiny Members.

Background

2.             At the meeting of this committee on the 16th October 2012, reference was made within the Capital Monitoring Report (for the period 1st April to 31st August 2012) to delays in the delivery of new vehicles that were included in the vehicle renewals programme (Minute 441 refers).

3.             This report explains the reasons for these delays and the measures now in place to reduce similar problems in future years.

Relevant Issues and Options

4.             The vehicle renewals programme is a schedule of vehicle replacements based on time and use.  The programme is aimed at ensuring that all vehicles are replaced at the optimum time, balancing the reliability of vehicles in service to their ongoing costs.

5.             The vehicle renewals programme is part of the Council's Capital Programme and ensures that the Council benefits from high quality, cost effective vehicle operations.

6.             The “life” of a vehicle is set at the time of delivery and this can vary from a period of between 5 and 12 years.  Due to this variation, and the fact that vehicles in the fleet are of various ages, there are always a number of vehicles requiring replacement each year.  The capital costs of the programme vary i.e. the value of the programme for 2011/12 being £1.25m and £1.614m for 2012/13.

7.             Prior to 31st January 2011, vehicles were purchased through the “All Wales Commercial Vehicles Framework Agreement”. However, this agreement expired at the end of January 2011.  Since then, vehicles have been purchased by the Fleet Manager directly from manufacturers or their local dealerships.  This has caused delays in the procurement process due to the increased administration.  Also, a number of the larger manufacturers have increased their lead times for delivery from 12 weeks to up to 44 weeks due to the current economic climate.

8.             Value Wales (Welsh Government service who support public sector organisations) with the assistance of Yorkshire Procurement Organisation introduced "Pro 5 Framework" an alternative to the “All Wales Commercial Vehicles Framework Agreement” in 2011.  The newly introduced framework failed to match the criteria required by Fleet Managers in South Wales resulting in the framework being suspended then re-launched in 2012.  Due to the framework failings, this had a knock on effect on procurement timescales.  The current framework appears to be more successful and meets the criteria required by Fleet Managers.

9.             During 2011/12, Fleet Management procured 38 new vehicles and 18 have been delivered outside the required timescales. The reasons behind the late delivery are as follows:-

·         8 vehicles were rejected on delivery due to local dealer supplying vehicles with incorrect towing specification.

·         5 vehicles - delivery suspended whilst incorrect towing specification issues were resolved.

·         3 special build 4x4 vehicles for Highways & Parks, the delivery times were extended by the manufacturers/dealer.

·         1 refuse vehicle where a "banksman" & camera system were incorrectly fitted on delivery.

·         1 sweeper vehicle developed electrical faults on delivery.

The value of these vehicles has resulted in an underspend of £762k in 2011/12 and this has slipped into the 2012/13 budget.

 

10.        The vehicle replacement programme budget for 2012/13 has been increased to £2.376m (includes £762k slipped from the 2011/12 programme).  The current position is that all vehicles from the 2011/12 programme have been delivered and total orders placed for vehicles to the value of £1.8m against the budget.  The Fleet Manager is currently working on placing orders against the remaining budget, but due to increasing timescales from manufactures, further delays are expected which may impact on this year's capital budget. 

11.        During early 2013/14, the service will plan the replacement programme in association with end users and the Council's Corporate Procurement Officer with the intention to place vehicle orders as early as possible. At this point, the service is mindful of manufactures build times and extended lead times. In procuring future vehicles, it is intended to use the Yorkshire Procurement Framework and/or the Council's procurement guidelines which best suit the authority's needs. Progress on this will be monitored at the monthly capital monitoring meeting.

Resource Implications (Financial and Employment)

12.        If delays are experienced in this financial year, part of the 2012/13 capital budget may need to be slipped into the 2013/14 budget. This will be quantified as soon as possible. The capital budget for vehicle renewals is funded from the Vehicle Renewal Reserve and/or Finance leases. The cost of the vehicle is then recharged to the client department on a straight line basis over the life of the vehicle.

Sustainability and Climate Change Implications

13.        None applicable to this report.

Legal Implications (to Include Human Rights Implications)

14.        The Council's procurement guidelines will be complied with where procuring new vehicles during 2013/14. Vehicles and systems are procured to current UK and European legislation.

Crime and Disorder Implications

15.        None applicable to this report.

Equal Opportunities Implications (to include Welsh Language issues)

16.        There are no equal opportunities implications that arise as a result of this report.

Corporate/Service Objectives

17.        To manage the Council's workforce, money information and assets efficiently, effectively and securely.

Policy Framework and Budget

18.        This report is consistent with the policy framework and budget.  All variations in the Capital programme are reported to Members via the capital monitoring process.

Consultation (including Ward Member Consultation)

19.        None applicable to this report.

Background Papers

None.

 

Contact Officer

Gareth George (Fleet Manager)

 

Officers Consulted

Operational Manager (Assets)

Corporate Procurement Officer

Capital Accountant

Operational Manager Legal Services

Accountant Visible and Building Services

 

Responsible Officer

Miles Punter (Director of Visible Services and Housing)

 

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