PROCUREMENT LINCOLNSHIRE 2015 / 16 ANNUAL REPORT

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Contents

3 Foreword

4 Main Achievements in 2015/16

5 Executive Summary

6 Efficient and Effective Procurement

12 Case Studies

17 E-Procurement Programme

18 Partnership Update

19 Performance Information

22 Financial Statement

23 Glossary

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Foreword

I have great pleasure in presenting the 2015/16 Annual Report, which provides an overview of

the achievements delivered by Procurement Lincolnshire and its Partners. I am delighted to have

been appointed Chairman of the Procurement Management Board and would like to thank

Manjeet Gill for the leadership and support she has provided as Chairman and for her continuing

attendance as a member of the PMB.

During 2015/16 Procurement Lincolnshire faced many challenges and has continued to

experience significant change at both operational and strategic levels. Whilst there is further work

required to embed these changes the Service now has a new leaner governance structure in

place, a fresh strategy and improved processes for work planning. A significant recruitment drive

has also been concluded which will provide the resources necessary to take the service forward.

Throughout this period of change Procurement Lincolnshire has continued to deliver real value to

its partners. Much of this is set out in the Annual Report, with examples of procurement activity,

driving best practice and market engagement to name a few, being fundamental in supporting the

delivery of partner objectives.

As Chairman I am committed to working with the service and partners to help shape the future

and reinvigorate what is an incredibly successful and highly regarded example of joint working

and whilst it is disappointing that South Holland District Council and East Lindsey District Council

have served notice to leave the partnership, it is not expected to have an adverse impact on the

operation of the service and we will seek ways to engage with them.

It is clear Procurement Lincolnshire and its partner Authorities face challenges, but with the

continued commitment of the remaining partners there are also many opportunities. I intend to

work closely with the service and colleagues from across the Partnership to make the most of

these opportunities and ensure that the service continues to adapt to new challenges, meets

evolving requirements and maintains its high standard whilst delivering value for all its Partners.

Russell Stone

Chairperson – Procurement Management Board

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Main Achievements in 2015 / 16

Generated over £7.4M cashable savings through procurement.

Cumulative savings of £39M since the inception of the partnership in 2008.

Achieved an average return on investment of 8.7 across the partnership as a whole.

Achieved an average return on investment ratio of 1:13 for the district councils within the

partnership.

Achieved an average customer satisfaction score of 4 out of 5.

Delivered two very large strategic recommissioning projects totalling over £53M between

them.

Setup the first Dynamic Procurement System for the shared service.

Established new governance arrangements, developed a new Procurement Strategy and

comprehensively re-drafted the Contract and Procurement Procedure Rules.

Recruited eight new team members to the shared procurement service.

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Executive Summary

This report sets out the key achievements that have been delivered throughout the past year by the

Procurement Lincolnshire partnership. Looking back over the past year the team can be proud of what

has been achieved. It is clear within the report that the service is going through a process of rapid

transformation at a strategic, tactical and operational level.

As well as continuing to deliver day to day procurement activity, advice, and guidance to the partnership

Councils, significant changes have been made in regards to our people, processes and technology – the

three key elements for a successful organisation transformation.

A significant and sustained recruitment drive has largely resolved the ongoing vacancy issue, and the new

team have established their own vision focussed on achieving Commercial Excellence. Recruitment

processes have been reviewed and changes have been made to ensure the effective targeting of

vacancies, and new robust interviewing procedures ensure that only the best candidates were recruited.

In addition to the above a new Procurement Strategy has been developed following feedback from the

partners and an assessment of the current and future priorities for the service. As can be expected further

efficiencies are a key strategic outcome, as well supporting partners with their commercial transformations

while not losing sight of the social duties of local authorities.

Finally it is important to recognise that a number of important changes have been made to operational

practices, including the comprehensive redrafting of the Councils Contract and Procedure Rules to ensure

they are compliant with the Public Contract Regulations 2015, and also to improve the usability and utility

of the documents.

While all of the above represent significant improvements there is still more to do and this will be the focus

of the team over the coming year to ensure the partnership receives the best possible support, and can

achieve excellent outcomes through procurement activity.

Alex Botten

Strategic Commercial and Procurement Manager

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Efficient and Effective Procurement

The shared procurement service is a notable example of how working together and pooling resources can

produce something greater than the constituent parts. By pooling financial resources and working together

the partners have created a critical mass of procurement expertise that can be deployed flexibly to meet

the needs of all partners. The model of a centrally hosted service and out-posted Procurement Officers

ensures that the partners benefit from the advantages of a larger and more resilient team, which would be

unaffordable individually, while still ensuring local priorities are delivered.

One of the most noticeable benefits of this model is the ability for the team to share knowledge, develop

their understanding together and pool mental capacity in order to deliver more efficient and effective

procurement. Recognising that it has been a difficult period for the shared service, and at the start of the

year the service may not have been in a desirable state, the focus of the past year has been to undertake

key activities designed to put the shared service back on track. The focus of this next section is to

highlight the significant steps forward that have been completed over the year.

Transforming the Shared Service

Over the year the service has changed the way it is governed with a leaner board structure, developed a

new strategy setting direction for the service, created new procedural requirements to reduce operational

risks, and not least recruited a new team of Procurement Officers.

Major improvements have been achieved over the past year in the service and these improvements are

set to continue well into the next year through the delivery of the strategy, the continued development of a

new motivated team with a clear vision to achieve commercial excellence, and an ongoing push to utilise

technology to improve working practices. However, this is set against the increasing risk involved with

procurement activity, and the additional resource burdens that the remedial actions incur.

New Governance Arrangements

Recognising that the relationship between the partners has developed over time, and that there was

duplication between the previous governance boards, the Procurement Advisory Board commissioned a

review into the arrangements. The review concluded that new leaner governance arrangements would be

more effective, and a new 'terms of reference' document was created setting out the responsibilities of a

consolidated governance board called the Procurement Management Board, merging the Procurement

Advisory Board and Strategic Procurement Board.

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The Procurement Management Board (PMB) sets the vision, mission, goals and Procurement Strategy for

the partnership establishing the framework for Procurement Lincolnshire to work within. Furthermore, the

PMB supports the shared service by setting the strategic direction, establishing broad priorities and

service focus, and helps manage partnerships with stakeholders in the shared service.

In addition to the new governance arrangements a new Chairperson has been elected Russell Stone will

be Chairperson of the PMB for the forthcoming year. The partnership would like to recognise the support

and leadership Manjeet Gill has contributed whilst Chairperson for the past three years.

New Procurement Strategy

To further transform the shared service a new procurement strategy has been developed, refocussing on

the challenges facing the partners now and into the future. In producing the strategy the service has taken

into account feedback from the partners, successes and lessons learnt from the previous strategy and

difficulties anticipated over the coming years.

At the start of the year Procurement Lincolnshire was operating under the 2011 strategy refresh. Although

the three key themes; Accelerating savings delivery, Sustainable procurement and supporting the local

economy, and Commissioning and market development, were still relevant there have been many

changes within the service in addition to the commercial environment in which it operates that rendered

some aspects out of date. In response to this the Procurement Advisory Board requested a review of the

strategy and initiated a discussion regarding the development of a revised procurement strategy.

A comprehensive review of the 2011 strategy refresh has been completed in order to gather the

information and feedback required to develop a new strategy to be better aligned to the future aspirations

of the partners. Consultation sessions were arranged between the Head of Procurement Lincolnshire and

a representative for each authority from the Strategic Procurement Board as well as the Procurement

Advisory Board.

The findings of the review have been captured in a report and shared with the partnership. The report

identifies that there was unanimous recognition that the service to date has delivered significant savings

for all partners involved, and often exceeded expectations. While this was excellent feedback for the team

the report also highlighted that with continuing austerity measures savings were still a high priority.

In addition to the focus on further savings, the report also identified that the partners are transforming their

organisations rapidly, with a focus on operating more commercially without losing focus on their social

responsibilities.

The new strategy is therefore aligned to these priorities with three refreshed strategic objectives:

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• Delivering efficiencies

• Enabling commercial transformation

• Delivering social value

It is expected that by delivering against these strategic objectives the partners will improve the

sustainability of public services for Lincolnshire, improve quality of delivery through improved commercial

approaches, while paying due regard to the social duties of a local authority.

A full copy of the new strategy can be found here

http://uk.sitestat.com/lincolnshire/lincolnshire/s?Home.procurement.buyers.policies-strategies-legislation-

and-

regulations.118912.articleDownload.98955&ns_type=pdf&ns_url=https://www.lincolnshire.gov.uk//Downlo

ad/98955

.

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New Procurement Team

The past year has seen a significant and sustained recruitment drive and the service has emerged with a

number of new faces, skills and experience to be deployed. Effective recruitment is considered by the

service as a key enabling process, and much time and energy has been invested to ensure that the

service recruits the best talent available. To that end Procurement Lincolnshire has advertised in the most

relevant publications, including the CIPS Supply Management magazine, and is currently working with

recruitment experts to have a more proactive approach to targeting potential candidates through the

LinkedIn platform. This expertise has been provided free of charge to the shared service by Lincolnshire

County Council's Organisational Development Team.

In addition the service has developed a robust and challenging interview procedure, ensuring the best

opportunity for candidates to demonstrate their abilities through practical case studies, presentations and

formal interviews. In total the service has recruited eight new team members in just over a year, and there

have been a number of promotions for existing team members. The team have collectively developed a

culture of aiming towards excellence, and have adopted the aspiration of becoming recognised as a

‘Centre of Commercial Excellence’. The coming year will see further development of the team with the

production and implementation of a Commercial Development Framework, ensuring that the service can

continue to invest in its Officers to further grow their skills and capability in order to achieve commercial

excellence.

From left to right, back row – Andrew Househam, Alex Botten, Alan Johnston, Joe Keir, Graeme Unwin, Michael Hunt, Peter Lee From left to right, front row – Sabrina Falgate, Kate Brown, Carol Harris, Claire Hill, Fiona Fielding, Megan Rice

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Changes to the Contract and Procurement Procedure Rules (CPPRs)

Each partner Council has a set of Contract and Procurement Procedure Rules (CPPRs) as an integral

part of the Constitution that inform Procuring Officers of the mandatory requirements for undertaking

procurement and forming contracts. The CPPRs promote good commercial practice, public accountability

and deter corruption. Following the procedures is the best defence against allegations that a procurement

activity has been undertaken incorrectly, fraudulently or unlawfully. The procedures cover all contract and

procurement activity undertaken on behalf of the Council(s).

In February 2015 the regulations setting out how local authorities must procure goods, services and works

(Public Contract Regulations 2015) were updated requiring the CPPRs to be updated accordingly. This

presented an opportunity to complete a major overhaul of the CPPRs to ensure they are easier to utilise

on a day to day basis, while improving the structure, guidance, definitions, and introducing the new

mandatory regulatory requirements.

The CPPRs have now been successfully updated and are going through the final stages of approval

within partners organisations, with some having adopted the new procedures already. To date the

feedback regarding the changes has been very positive, with Officers commenting that the documents are

now easier to navigate and have made their obligations more transparent. This positive feedback should

in turn result in a greater understanding of the procurement regulations, reducing the risk of receiving legal

challenges and an overall higher quality of procurement practice.

Case Law – Landmark case: Milton Keynes vs Woods Building Services

In addition to observing the Public Contract Regulations and following the CPPRs, partners need to be

aware of case law relating to legal challenges setting new precedents. The Public Contract Regulations

permit any supplier to raise a legal challenge if they consider the conduct of the procedure to contain

manifest errors, or if the Council has not followed the principals of the EU Treaty, i.e. equal treatment,

non- discrimination, transparency and proportionality.

An example of this was borne out of a landmark decision in July 2015 from the case Woods Building

Services vs Milton Keynes Council, for a contract relating to asbestos removal, where Woods Building

Services raised a legal challenge against Milton Keynes Council. The nature of the claim was about the

specific scores awarded to Woods, and the successful bidder, during the evaluation process.

Up until this case evaluation scores were often regarded as safe harbour, and judges had deferred away

from examining the rational for each specific score. This time however, the judge has gone further in the

examination of how the evaluation was carried out. In hearing the case, the judge looked at the marking of

all the evaluation criteria, and decided that the scoring and process for eight out of the twelve award

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criteria had been unlawful. After making adjustments to the evaluation, based on his personal scores, he

said that Woods had “provided the best tender,” and should have won.

This was the first time a judge in an English court had set aside a public body’s contract award decision

under the Public Contract Regulations (2006). Other cases have seen damages awarded, but the

Authority has been allowed to carry on with the contract, even if the process was flawed, but not in this

case.

It must be noted that remedies for the unlawful procurement include damages payable to the claimant, the

contract was set aside meaning Milton Keynes had to incur the cost of re-procuring the service, including

paying the costs for the incumbent to ensure service provision during the re-procurement period.

This case evidences the increasing risks faced by Local Authorities undertaking procurement activity, and

since this case was decided there is evidence to suggest that aggrieved suppliers are ever more prepared

to challenge public bodies over their procurement decisions. Procurement Lincolnshire maintains close

working relationships with a number of highly regarded legal practices, whom have seen a surge in

challenges, now often settled prior to court proceedings. Even with dedicated procurement professionals

there is always some risk when going out to procurement but it is more imperative than ever to stay

together to reduce these risks.

Procurement Lincolnshire has responded to these increases risks by:

• Improving the internal quality assurance procedures at key stages in the procurement process;

• Re-writing the Contract and Procurement Procedure Rules to reduce the risk of the Council(s) of

the partnership operating in a non-compliant manner and removing some high risk evaluation

activities, such as presentations;

• Issuing briefings to each partner authority prior to undertaking evaluation activities setting out risks

and obligations;

• Developing a new set of standard procurement documents with an improved evaluation model and

guidance.

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Case Studies

The following section describes case studies of selected activities and

innovations from across the partnership, highlighting some of the key

deliverables completed within the year.

Case study 1 – Gas Purchasing (Andrew Househam)

Partners involved

All partners

Description

The energy market is very complex, volatile and impossible to benchmark in terms of contract

performance due to the number of variables at play. In addition to this there are a number of

external factors that will impact market price i.e. oil prices, weather, economy, geo-political and

currency. It is for this reason that Procurement Lincolnshire advise all partners to sign up to the

ESPO Energy Access Agreement for both its gas and electricity supply.

After a formal compliant procurement process, Total Gas & Power were successful in their bid to

become the single source provider for the gas supply contract for the next 3 years. During this

time the Energy Governance Forum for ESPO (made up of ESPO partner authorities – County

Council's/Procurement Lincolnshire) had formally devised a new cover plan to generate more

volume flexibility to allow ESPO to react positively to market prices. Early indications suggested

that the new strategy could deliver up to a 20% saving against the previous year's wholesale

costs, although the figure could vary depending on market behaviour.

More recently the Energy Governance Forum identified that gas prices hit a 20 year low

following a sustained fall on wholesale price. The Energy Governance Forum sought approval

from its members to move away from a risk spread approach, typically making a number of

trades over a 12-18 month period, but to actually lock-out and buy 3 years supply.

Benefits

It is expected that this strategy for 2015/16 will provide a 30% cost avoidance benefit on the

wholesale costs in year one, up to 40% in year 3 (The wholesale element only equates to

roughly 45% of the cost per unit that is billed). This equates to £900k cost avoidance benefit

over the next 3 years across the partnership.

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Case Study 2 – Lincolnshire Libraries

Procuring Officer – Sophie Reeve / Fiona Fielding

Partners involved

Lincolnshire County Council

Description

In 2013 whilst consulting on a preferred new model of delivering library services within

Lincolnshire, an expression of interest in the delivery of the service was received. As the

submission was from a relevant body for the purposes of the Community Right to Challenge

provisions of the Localism Act 2011, this triggered an obligation to undertake a procurement

exercise for the library service in February 2015.

The procurement fell under the classification of a Part B service within the Public Contract

Regulations 2006, which allowed the Council to apply a flexible approach to the procurement

with the Council adopting a competitive dialogue-type approach. This provided the opportunity

to explore through dialogue different potential solutions with different bidders before choosing

the solution best able to meet the Council’s requirements.

Competitive dialogue secured the agreement from all bidders to improve and transform the

service's operations and performance, enhance the library offer and improve customer

experience. Following an eight month procurement period the contract was awarded to

Greenwich Leisure Limited (GLL) in December 2015. With a seamless handover of operations

(including the TUPE transfer of 146 staff, 15 buildings, 9 vehicles and approx. 900k books) the

contract with GLL (5 years plus 5) commenced on 1st April 2016.

Benefits

Value for money has been secured in this procurement exercise by conducting it under a

competitive dialogue process with full open market participation. As GLL is a not for profit

organisation, 80% of the non-domestic rates will be rebated - approx. £300,000. In transforming

the whole stock management element of the service including levels of stock held, GLL did not

require the proposed new library distribution centre resulting in a cost saving of £2.6M with

annual running costs of £50,000.

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Case Study 3 – AllPay Electronic Payment Services

Procuring Officer – Sabrina Falgate

Partners i nvolved

Lincolnshire County Council, City of Lincoln Council, South Kesteven District Council, East

Lindsey District Council.

Description

With the expiry of the previous contract for the supply of electronic payment services,

Procurement Lincolnshire worked with the partners to re-procure the new contract. The scope

was to procure a service which enables service users to pay for various Council facilities via

electronic payment, including council tax and rent.

The strategy involved accessing the Northern Housing Consortium Framework, where a call-off

under direct award was entered into with the incumbent; AllPay. This was the favoured option as

it provided the opportunity to efficiently deliver a compliant contract and provide savings whilst

maintaining continuity of service, thus eliminating costly set-up fees and minimising disruption to

existing processes.

The contract began in January 2016 and shall run for an initial period of 2 years, with the option

to extend up to a further period of 2 years.

Benefits

Collaborating with the District Councils significantly increased the demand for service. The

opportunity to converge these requirements into the same contract meant greater economies of

scale, resulting in lower costs for all districts by reducing supplier margins by 5%. This shall

deliver anticipated savings of circa £30,000 over the duration of the contract. Other benefits

include effective partnership working, supplier cohesion between the Councils and an efficient

and compliant route to re-procuring the new contract.

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Case Study 4 – Home to School Transport for Children with SEND

Procuring Officers – Alex Botten / Fiona Fielding

Partners involved

Lincolnshire County Council

Description

The previous tendering arrangements for procuring Home to School Transport for Children with

Special Educational Needs and Disability (SEND) were very fragmented, resulting in over 500

individual contracts with over 140 suppliers. Each individual passenger route would be tendered

and contracted separately which created an unsustainable resource burden on the Passenger

Transport Unit. Following on from a procurement review a new procurement model was

developed requiring only one provider to undertake all of the required transport for one

educational establishment, reducing administration while consolidating the market.

In addition to the new tendering approach, a new contract was developed removing less

favourable terms for the suppliers, introducing a more stable pricing model and improved risk

sharing between the suppliers and Council. As this was a significant change to the approach

there have been several rounds of discussion with the market, and supplier days aimed at

informing the market. To enable some flexibility for new providers entering the market a decision

was made to utilise a Dynamic Purchasing System (DPS) which was a first for the shared

service. A DPS is a wholly electronic procedure which is best described as an 'open framework'

allowing new suppliers to join the DPS at any point in the future.

Benefits

The new model is expected to improve relationships between the providers, service users,

schools and Council, while securing efficiencies. The contracts for each school will be tendered

during 2016/17.

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Case Study 5 – Hybrid Mail Services

Procuring Officer – Graeme Unwin

Partners involved

City of Lincoln Council, Compass Point Business Services (East Lindsey District Council and

South Holland District Council)

Description

Procurement Lincolnshire undertook a procurement exercise on behalf of three partners to

select an external provider to manage the process and distribution of all the Councils' annual

billing and benefits notifications. The CCS Framework for Postal Goods and Services was

utilised which involved conducting a formal further competition exercise between eligible

suppliers. North Kesteven District Council and West Lindsey District Council pledged to use the

future contract at a later date and provision was made in the contract to allow for this. However,

City of Lincoln District Council already processed some relevant documentation for NKDC and

WLDC as part of a shared service arrangement meaning five partners were included to some

extent, in the original procurement scope.

Benefits

A three year contract commencing 4th January 2016, with an option to extend for a further year

was awarded to Critiqom Ltd. Partners are able to set up and modify templates of their billing

and benefits documentation which is accessed via an external portal provided by Critiqom Ltd.

This technology will ensure future documentation can be easily accessed and managed by

partners at a lower cost and may lead to cross standardisation of documentation. As documents

are released from the portal by partners for distribution to their customers, the provider can

consolidate all of their processing activity to achieve lower distribution costs. These are realised

from lower stationery costs and reduced postal rates. Partners intend to phase in the

introduction of document processing when using the new contract, concentrating on the higher

volume documentation first. At present this phased approach is still happening and partners are

not able to quantify the details of the savings realised, however the savings are expected to be

notable.

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E-Procurement Programme

Procurement Lincolnshire has continued its commitment to improving the efficiency and effectiveness of

procurement by adopting fit for purpose tools and systems to support our procurement activity throughout

2015 / 16.

Category Analysis Tool – Category Dojo

Category Management can be an effective approach to re-organising procurement spend and identifying

opportunities to award contracts more strategically, and better aligned to the supply market. Category

analysis is a day one activity when looking to secure improvements through category management, but it

can be difficult to ensure consistency in the analysis approach and reporting findings. During the past year

Procurement Lincolnshire has been evaluating a new software tool designed to bring rigor and

consistency to category analysis, and has been able to secure a licence to utilise the tool. Over the

coming year the team will use the tool to aid the partners to undertake a commercial review, with the aim

of identifying potential efficiency or contract re-modelling opportunities.

It is expected that Category Dojo will complement the LCAT platform by providing a more consistent

approach to analysing the spend data, which is made available via the LCAT platform.

e-Procurement System - ProContract Procurement Lincolnshire has also procured access to a new enterprise procurement platform via an East

Midlands agreement with Due North. The system is expected to bring a number of benefits including; a

gated workflow process for procurement, greater ability to have tailored procurement practices, data

migration from procurement to contract register, a platform to operate new procurement procedures such

as Dynamic Purchasing Systems (DPS), improved evaluation tools, and greater visibility of contracts

within the East Midlands for our local suppliers.

Due to an urgent need, the County Council has already adopted the DPS tool and will be looking to

migrate all procurement activity to the new system during 2016/17, and District partners will also have the

opportunity to join the system during 2016/17.

Lincolnshire Category Analysis Tool (LCAT) Procurement Lincolnshire continues to host the LCAT spend analysis application for the benefit of the

partnership authorities. The spend analysis tool provides the partners with full spend transparency,

identifying which suppliers have been used, where they are located, what has been purchased and for

how much. This information is critical to feed into the Category Dojo platform in order to undertake a

category analysis.

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Partnership Update

During the year the service has received two notices of intent to withdraw from the shared service, sent by

South Holland District Council and East Lindsey District Council. While it is disappointing that both

authorities have served notice to leave the partnership, it is not expected to have an adverse impact on

the operation of the service, and Procurement Lincolnshire will seek ways to engage with them.

Both authorities have provided the requisite 12 months’ notice and during the coming year the focus will

be to help the Councils achieve an orderly exit, and to explore ways to support the Councils with their

procurement as and when needed.

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Performance Information The following table provides a comparison of cumula tive savings achieved by Procurement Lincolnshire since its inception, against the cumul ative targets for the same period.

Authority Cumulative Savings Cumulative Target Variance

City of Lincoln Council £4,168,542 £2,466,318 +69%

East Lindsey District Council £2,467,444 £1,922,565 +28%

Lincolnshire County Council £18,811,487 £12,258,963 +53%

North Kesteven District Council £5,592,778 £2,232,566 +151%

South Holland District Council £3,097,942 £2,007,952 +54%

South Kesteven District Council £3,548,015 £3,196,741 +11%

West Lindsey District Council £1,601,543 £1,093,602 +46%

Total £39,287,751 £25,178,707 +56%

The variance shows the variance in performance against the target, a fully met target would show 0% variance, rather than 100%. The calculation is: ((Savings – Target)/Target) * 100

A comparison of 2015 / 16 savings against targets

Authority Annual Savings Annual Target Variance

City of Lincoln Council £994,614 £740,000 +34%

East Lindsey District Council £489,069 £450,000 +9%

Lincolnshire County Council £4,046,609 £1,230,000 +229%

North Kesteven District Council £340,112 £220,000 +55%

South Holland District Council £303,258 £290,000 +5%

South Kesteven District Council £953,870 £880,000 +8%

West Lindsey District Council £281,038 £280,000 +0%

Total £7,408,570 £4,090,000 +81%

The variance shows the variance in performance against the target, a fully met target would show 0% variance, rather than 100%. The calculation is: ((Savings – Target)/Target) * 100

Value for money A comparison of 2015 / 16 contributions against sav ings

Authority Annual Contribution Annual Saving ROI

City of Lincoln Council £40,352 £994,614 23.65

East Lindsey District Council £40,352 £489,069 11.12

Lincolnshire County Council £528,683 £4,046,609 6.65

North Kesteven District Council £36,223 £340,112 8.39

South Holland District Council £36,223 £303,258 7.37

South Kesteven District Council £40,352 £953,870 22.64

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West Lindsey District Council £36,223 £281,038 6.76

Total £758,408 £7,408,570 8.77

The Return on Investment is calculated as follows:

ROI = (annual savings – annual contribution) /annual contribution

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2015-16 Key Performance Indicators

KPI Performance

Indicator

Performance indicators to understand how we are improving

15-16 Annual Target

15-16 Actual

15/16 – 1 Efficiency and Value for Money

Savings delivered by the shared service partnership - this measure will be the Cashable savings, as defined within the savings model agreed by the partnership governance board - includes savings from LCC grey fleet review

£4,090,000 £7,408,570

15/16 – 2 Efficiency and Value for Money

Average partner ROI from service - calculated as follows; ROI = (cashable savings – partner contribution )/partner contribution - includes savings from LCC grey fleet review

4.39 8.77

15/16 – 3 Collaborative Procurement and Partnerships

% of new contract spend through collaborative arrangements - calculation as follows: total = (total collaborative contract value / total contract value) * 100

60% 15.71%**

15/16 – 4 Regeneration The % of bids received by local suppliers - calculation as follows: total = (total bids from local suppliers for the year / total bids for the year)* 100

56.1% TBA – pending

data

15/16 – 5 Regeneration Increase in spend with local businesses +0.25%

TBA – pending spend data

15/16 – 6 Community / Customer Involvement

Average internal directorate satisfaction score - Post procurement support questionnaire provides feedback for these scores to be calculated.

4 / 5 4

** A number of large re-commissioning projects have skewed this figure, i.e the Lincolnshire Libraries project was

solely for LCC and the value was £40M and it was not possible to use a collaborative arrangement for this contract.

Without these projects the figure is 87.66%.

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2015 / 16 Financial Statement

2015/16 PL Budget

738,497 Staffing Costs Salaries On costs Other Staffing Costs e.g. travel Total Staffing Costs

353,575

88,930

35,470

477,976

Non Staffing Costs

Supplies and Services Legal Fees Other Support Costs Total Non-Staff Costs

60,122

903

34,808

95,833

Total Staffing Costs Total Non-Staff Costs Total Costs Other Income

477,976

95,833

573,809

7,220

Total Net Costs

Budget

Underspend

566,589

738,497

-171,908

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Glossary

LCC Lincolnshire County Council SME Small and Medium Sized Enterprise TIPPs Training in Public Procurement LCAT Lincolnshire Category Analysis Tool EU European Union NIEP National Improvement and Efficiency Partnership RIEP Regional Improvement and Efficiency Partnership VCS Voluntary and Community Sector ESPO Eastern Shires Purchasing Organisation SOPO Society of Procurement Officers ERDF European Regional Development Fund NEC New Engineering Contract CIPS Chartered Institute of Purchasing and Supply