Agenda item

Matthew Kelly, Head of Procurement & Commissioning introduced the report, informing Members that procurement was increasingly seen as a policy lever to deliver national and local strategies. A more proactive approach was being taken to contribute to a broader social value offering including levelling up, net carbon zero and job creation. The Hillingdon Procurement Team was attempting to harness spending power where possible to support local businesses, particularly smaller ones.

The Committee heard that there was no explicit legal requirement for Procurement to support local business; however, attempts were made to do so where it would be of benefit to the Council. There were a number of risks and challenges in relation to this which had to be managed carefully. To date there had been a number of success stories, some of which were highlighted in the report.

In terms of tender documents, Members were advised that these had recently been reviewed to simplify them and remove duplication where possible. The aim was for Hillingdon Council to be a customer of choice. Where it was felt that a requirement could be met by local businesses, attempts were made at the pre-tender phase to support that to happen and to level the playing field with larger businesses who were more proficient at responding to local authority contract opportunities. This was always a balancing act as due diligence and value for money were also essential. The Committee was informed that Procurement officers operated a one bid local policy when meant that officers were actively seeking bids from local suppliers in all tenders and quotations. The Council was currently exploring options with a business advisory consultancy – Branduin, that could potentially be used to support local businesses.

The Committee was advised that, given the business demographics in the Borough and the prominence of the aviation sector, Procurement officers were also trying to develop local providers. One example was in relation to Occupational Therapists. The services were primarily outsourced at a cost of c£600k pa. Procurement officers had identified that Brunel University had an OT course and had been engaging with them to create a pathway for new graduates to potentially work with contracted suppliers or consider a new enterprise. In terms of reserving contracts for local businesses and/or SMEs, Members heard that the legality of this approach was being debated externally at present; the developing situation would be monitored closely.

With regards to next steps, the Committee was informed that there would be a continued drive to further develop support for local businesses in a number of ways. This would include increased promotion and comms, updating the website, aiming to become a customer of choice and aligning work on support for local businesses with other priority areas such as skills, innovation and net carbon zero.

In terms of the success stories set out in the pack, it was noted that few smaller organisations appeared on the list – the Committee enquired whether smaller companies were possibly being squeezed out by larger rivals. Members were also interested to know whether, in areas where there was little engagement with local small businesses, it was possible that the Council as an organisation was perceived to be too big to work with.

In response to their queries, the Committee heard that, although the Council broke contracts down into smaller lots, each lot was still relatively large. If broken down further, this would result in a more costly and complex system which would be challenging for the Council to manage and was therefore not feasible. It was acknowledged that smaller local contracts could potentially lead to increased prosperity within Hillingdon, but it was important to get the thresholds right.

In response to further questions from the Committee in relation to the 80% price / 20% split used to assess contracts, it was confirmed that this had changed to a 50/50 split, although there would still be scope to vary this as necessary.

RESOLVED: That the Corporate, Finance and Property Select Committee noted the contents of the report.