Issue - meetings

The Executive Board Sub-Committee considered the attached report.

RECOMMENDED: That vehicle and plant replacement be included in the capital programme at a cost of £1.192m in 2007/8.

            The Executive Board Sub-Committee had considered a report of the Strategic Director – Environment requesting agreement to the replacement of part of the Council’s Fleet of Vehicles and Plant by various acquisition methods rather than through the current Contract Hire supply contract.

            RESOLVED: That vehicle and plant replacement be included in the capital programme at a cost of £1.192m in 2007/8.

            At present, the Council operated 109 vehicles and 88 items of plant and machinery acquired through tendered contracts on a contract hire basis. 48 of these fleet items with a combined capital value of £1.5m were now approaching their respective contract expiry dates. Whilst there was an existing supply contract in place until December 2007, which could be used for the replacement of these fleet items, an alternative procurement approach had been explored which had highlighted alternative, more cost effect acquisition methods than under the current arrangements.

            During September, Sector Treasury Management were commissioned to carry out an options appraisal on different financial methods of fleet acquisition and to compare these against the cost of the contract hire. The alternative methods suggested were: Operating Lease, Finance Lease and Borrowing.

            The Sub-Committee were advised on the appraisal exercise which demonstrated that a ‘one size fits all’ approach would not be in the Council’s interest, but the flexibility of using all of the different methods depending on a number of factors including interest rates, residual values, vehicle capital costs, repayment terms and the number and type of vehicles required, would  provide the least expensive way forward.

            The purchasing of these fleet items was governed by European Procurement Rules. It was therefore proposed that further efficiencies on procurement process could be made if the Operational Director – Highways, Transportation and Logistics was authorised to agree terms with an established Central Purchasing Body (CPB) under the Public Contracts Regulations 2006.

            Provided the Council purchases from a CPB arrangements that have themselves complied with, the 2006 Regulations then there was no requirements for Halton to go through the advertising process again

            It was noted that a number of local authorities and central government department had set up Procurement Organisations that had establishment fleet procurement frameworks that fully complied with the Public Contracts Regulations 2006.

            RESOLVED: That

(1)       the Operational Director for Highways, Transportation and Logistics in consultation with the Operational Director, Financial Services, Executive Board Member for Environment, Leisure and Sport and the Executive Board Member for Corporate Services be authorised to procure vehicles and plant through the most advantageous financial funding method;

(2)            Council be recommended to include vehicle and fleet replacement in the capital programme at a cost of £1.192m in 2007/08; and

(3)            procurement is undertaken through a central Purchasing Body complying with the requirements of the Public Contracts Regulations 2006.