To consider the oral report of the Professional Lead, Commercial Services.
Minutes:
The Committee received a presentation on the work of the Commercial Service Team by the Professional Lead, Commercial Services.
Issues:
· Northgate
· Cumulative savings
· Collaboration with other authorities
· Cost of producing invoices
· Double accounting of savings
RESOLVED to exclude the public for the following items of business on the grounds that there would be disclosure to them of exempt information under category 1 of The Local Authorities (Access to Information) (Variation) (Wales) Order 2007
· The Committee was provided of an overview of the requirements Northgate were expected to deliver
· Northgate were reskilling the Commercial Services Team and would start to withdraw after 18 months. Their contract ends in September 2017.
· Members requested that net figures be given in reports
· The Portfolio Holder was asked if he would consider using this type of contract in the future. He responded that this had been a good example and would be used where appropriate.
· As the Council becomes more commercially aware there would inevitably be a need for fewer staff – however, commercial rigour would still be required as the Council moves to a commissioning model
The Committee returned to open session.
· Further clarity was needed regarding ‘cumulative’ or ‘anticipated savings. The move to a three year budget should provide that clarity but the Strategic Director invited Members to challenge any further instances where jargon was used.
· Many purchases were made through the Wales Purchasing Consortium but there was no direct collaboration with other authorities. It was hoped to progress to greater collaboration once the Authority’s own processes were more developed
· It was noted that the current cost of processing an invoice was £25 in line with the national benchmark. The Committee were concerned that there were many thousands of invoices processed valued at less than £20. The Professional Lead informed Committee that she hoped that this level would fall following recent intervention but that the data was not yet available.
· An ongoing concern of Members was that the same savings may be being accounted for in different areas. All lines for savings have been consolidated although it was acknowledged that there had been some initial confusion. The Professional Lead for Finance was undertaking a wide ranging task to assess this issue. This was nearing completion and the findings would be reported to Members.
· Cost reductions did not always lead to budget reductions
· Members were pleased that payment was no longer made against invoices which did not include a purchase order but questioned why this had happened at all. The Authority had had a low level of purchase order compliance but this was now much tighter. Compliance had risen to 90%, excluding schools, from 35%. The change had caused some difficulties to local suppliers. Financial discipline continues to improve.
· Members noted the next steps to be taken with regards spend control and cited examples of where they thought there could be tighter financial control – for example in travel and accommodation. All requisitions are now approved by the Professional Lead but must have a proven business case or Head of Service approval.
Outcome:
· That the presentation be noted.