The Procurement Board has decided to approve the extension of the postal services contract with Whistl UK Limited.

URL: https://sccdemocracy.salford.gov.uk/ieDecisionDetails.aspx?ID=2279

Decision Maker:

Outcome:

Is Key Decision?: No

Is Callable In?: No

Purpose:

Content: Executive Decision Exemption from Call-in   Request to a Scrutiny Chair that an Executive Decision be exempt from Call-In for Scrutiny   Decision maker   Procurement Board Nature of the decision   Approve contract Extension Non-confidential reports Can be made available to the public Yes – Approval for an Extension of Contract for Postal Services Confidential reports Containing confidential or exempt information None Reason for confidentiality   N/A Intended date of decision   15th March 2023 Officer contact details For any further information Name: Tel: Email: Peter Cowling 0161 793 3993 [email protected]  Is exemption from call-in for scrutiny needed? Yes, Extension contract date was due for implementation on 1st March 2023 Scrutiny Chair Who has agreed the decision should be exempt from call-in Name: Cllr J Mullen (Chair of the Overview and Scrutiny Board) Signed: J.A. Mullen     Date: 10/03/2023   Request prepared by: Peter Cowling       Salford City Council – Record of Decision   I Councillor Youd, Lead Member for Finance and Support Services and chairman of the Procurement Board, in exercise of the powers contained within the Council Constitution do hereby:   ·      Approval for an Extension of Contract for Postal Services   Detail required Answers Contract Reference S1025 Title/Description of Contracted Service/Supply/Project Postal Services Name of Contractor WhistlUk Limited Type of organisation (to be supplied by Corporate Procurement) Private Limited Company Status of Organisation (to be supplied by Corporate Procurement) Non-SME Value of Contract Extension (£) £          480,000  full project Existing Contract Term 01/03/2021 to 28/02/2023 Extension Period 01/03/2023 to 29/02/2024 Contact Officer (Name & number) Peter Cowling 0161 X4996 Lead Service Group Service Reform & Development Funding Source Revenue Budget Ethical Contractor (EC): Mayor’s Employment Charter EC: Committed to sign the Charter EC: Accredited Living Wage Employer   The reasons are: ·         In February 2015, a group of authorities from the Yorkshire and Humberside region agreed to form a collaborative group for the procurement of mail services in the region.  This was subsequently extended to include authorities from Greater Manchester with the intention of driving cost saving through volume-based discounts there has now been several contract renewals using this procurement group the group now consists of 24 authorities    ·         The aim of this procurement exercise was to establish a single service provider to deliver a robust postal service to the named contracting authorities that provide savings to all authorities and delivers social value ·         In February 2020 the Procurement Board approved the award of the postal service contract to Whistl Ltd.   Financial benefits: Following notification of extensions by other framework partners including the lead authority Kirklees the collaborative group has secured better commercial pricing and terms than would possible individually, One of the major strengths of the Whistl agreement is Volume related discounts (VRD) to all participants based on combined volumes.   The minimum for collective authorities to achieve the maximum VRD is 15 Million mail items per annum. Currently, the YHA/Whistl agreement currently process in excess of 15 million items per annum, therefore, Salford should benefit from maximum VRD. Salford CC sent 925,435 items during 2022 (Jan-Dec) The total saving achieved by Salford during 2022 in comparison with Royal mail services is £181,804 (Jan-Dec)   Additional savings benefits of this contract were reflected following a recent increase by Royal Mail on postal prices announced at 20% due to the benefits of collaborative discount and volumes Whistl were able to reduce this pricing impact to 17%, which will result in a saving of approx. £13K based on Salford’s 2022 volumes.   Whistl has agreed through clarification that all volumes contribute to achieving the overall volume-related discount ‘thresholds’ however discounts will only apply to the DSA items (this excludes, recorded or special delivery items). This will ensure that the authorities can benefit from all of their volumes being included in the commercial proposition.   Best Value: This contract was procured via a competitive tender process, therefore, ensuring the best value supplier was appointed. Whilst Salford have the ability to procure this service individually, we would be unable to match the savings applied from volume-based discounts achieved by the collaborative offer.   Social Value: Throughout the process, the authorities prioritised the delivery of greater social value and added emphasis to the provision of training and employment opportunities to local people by the successful supplier. In their response, Whistl indicated its commitment to generating employment in the local areas and through its supply.   Whistl has provided a statement outlining their Social value process (See supporting document Whistl social value Document)   Whistl has since opening their super hub in Bolton worked with a number of local authorities including Salford. Wigan, Bolton local colleges and schools to provide opportunities for employment.   In addition to supporting local authorities whistle have created a driver training academy since 2021 to train potential HGV drivers via apprenticeships for anyone over 18 with a drivers licences. Whistl have recently created a Greater Manchester Careers and Enterprise Advisor network to operate at local/Regional levels working with local schools to provide the oppoertunity for students to experience working life before they leave school with schemes ranging from logistics to support functions such as HR, Marketing and Finance. Salford will be looking to engage with these services via our account manager   Whistl also have a commitment to disadvantaged communities as part of its EDI charter (Equality Diversity Inclusion)   KPIs and Contract Monitoring – ·           KPIs will be monitored at quarterly intervals between the allocated Whistl account manager, Peter Cowling (SCC Business Manager) & Christopher Eckersley  (Document services manger) ·           KPI monitoring will include o   All volumes of post in the period o   Postal Class reports (to identify potential to change service class) o   Invoicing Values Delivery Times   Options considered and rejected were: None   Assessment of risk: Low   The source of funding is: Revenue Budget   Legal advice obtained: Yes   Financial advice obtained:Yes   Procurement advice obtained: Yes   HR advice obtained: Not Applicable   Climate change implications obtained:Yes   Documents used: The following documents have been used to assist the decision process: ·      RM1063 Tender Report – Summary paper produced by Lead Authorities outlining the result of the tender process (available on request) ·      Record of Decision 17/02/2020   Contact details: Contact Officer:        Peter Cowling Telephone number: 0161 779 4996   Please delete from the bullets below any which are not relevant This matter is also subject to consider by the Lead Member for Finance and Support Services The Lead Member has been consulted and is supportive of the proposed contract. The appropriate Scrutiny Committee to call-in the decision is the Procurement board   Signed:      Cllr Youd           Dated:      15 March 2023                     Lead Member   FOR DEMOCRATIC SERVICES USE ONLY   *   This decision was published on 15 March 2023. *   This decision is not subject to call-in and comes into force with immediate effect.  

Date of Decision: