The TAM contract is currently in year 9 of a
10-year contract and is due to end on the 30th June 2024. With just
under 14 months remaining on the contract, the Council have
appointed Altair Ltd to support the Council with the commissioning
element for the replacement contract.
Even though the commissioning process is progressing well, the
current project plan will not allow for a thorough commissioning
and procurement process to be completed in time for the 1st July
2024. To provide the Council with the required flexibility to
undertake a comprehensive process, the current contract will need
to be extended by at least 12 months.
Whilst progressing with the commissioning process, we also need to
ensure that the current TAM contract delivers the level of service
expected by our tenants and leaseholders. However, we are operating
in unprecedented times due, in part, to Brexit, the COVID-19
pandemic and now the war in Ukraine. This has led to rising
construction prices in the housing sector with repairs and
maintenance costs surging over 2021 and 2022.
The above factors have led to the current schedule of rates in the
TAM contract falling below market rates, which led to the Council
commissioning Ark Consultancy to review the contract rates against
the rates in the market. This identified that a number of the rates
in the contract are significantly below market rates, which is
having a significant impact on OPSL’s ability to attract the
required supply chain to deliver the contract to the required
level.
This independent review was provided to OPSL for them to propose
new rates to the Council prior to entering into a negotiation. The
commercial negotiation has led to a number of rates in the contract
being increased.
It is important to note that the rates agreed with Osborne in
negotiations were below the average market rates identified in the
ARK Benchmarking review and thus continue to represent good value
for money.
As part of the negotiation process, OPSL have also agreed to the
implementation of an improvement plan, which will be led by the
Contract And Commissioning Consultant and supported by the Head of
Commercial Housing Contracts. This will look at a number of areas
across the client and contractor side of the contract, focusing
on:
•OPSL proposed overhead and delivery model linked to new rates
and determine suitability to deliver services for the remainder of
the contract period.
•Targeting specific problem areas/themes within the
contract.
•The Council’s processes regarding operational
management of the contract.
•Carry out a review / audit of the current OPSL systems and
processes and then work with OPSL to develop a targeted annual
efficiency saving plan by Osborne for 23/24 and 24/25.
•Undertake comprehensive review of current TAM performance
measures to include re-defining appropriate KPIs, the contract
affordability, data collection criteria, data sample criteria
Decision type: Non-key
Decision status: Recommendations Approved
Notice of proposed decision first published: 02/06/2023
Decision due: 25 May 2023 by Chief Housing Officer
Contact: Andrew Linden, Head of Commercial Housing Contracts 01442 228263, Email: Andrew.Linden@dacorum.gov.uk Email: andrew.linden@dacorum.gov.uk.