Agenda item

To consider the attached report (C-025-2019-20).

(1)        That, Gracelands Complete Maintenance Services Ltd be awarded the 1-year contract renewable annually for up to a maximum of 4-further years, for the planned installation of gas and renewable energy heating and associated electrical upgrade work to Council-owned properties in the sum of £103,377.16 with an overall weighted price and quality score of 97.1%;

(2)        That Complete Building Services Herts Ltd be selected as the Council’s Reserve Tenderer and that, should it not be possible to enter into contract with  Gracelands Complete Maintenance Services Ltd for some reason, Complete Building Services Herts Ltd be awarded the 1-year contract renewable annually for up to a maximum of 4-further years, for the planned installation of gas and renewable energy heating and associated electrical upgrade work to Council-owned properties, being the second most economically advantageous tender received, with a Tender Sum of £187,311.93 with an overall weighted price and quality score of 64.4%;

(3)        That, the overall value of the works be capped to the allocated budgets included in the Capital Programme identified for Gas and Electrical Heating replacements on an annual basis; and

(4)        That, this contract be designated as a serial contract to facilitate the annual adjustment to the tendered rates in accordance with the Royal Institution of Chartered Surveyors (RICS) BCIS ALLCOS Resource Cost Index of All Construction: All Repair and Maintenance Work #7419.  

The Housing and Property Services Portfolio Holder, Councillor H Whitbread introduced the report on the acceptance of tender for contract 390.

In order to undertake Planned Gas and Renewable Energy Heating Installations and Associated Electrical Upgrade Work to Council-owned properties during the financial year 2019-20 and over the following 4-year period, it was necessary to undertake a procurement exercise based on the Most Economically Advantageous Tender (MEAT) taking cost and quality into account and to satisfy the requirements of the Council’s Procurement Rules. 

DECISION:

(1)        That, Gracelands Complete Maintenance Services Ltd be awarded the 1-year contract renewable annually for up to a maximum of 4-further years, for the planned installation of gas and renewable energy heating and associated electrical upgrade work to Council-owned properties in the sum of £103,377.16 with an overall weighted price and quality score of 97.1%;

(2)        That Complete Building Services Herts Ltd be selected as the Council’s Reserve Tenderer and that, should it not be possible to enter into contract with  Gracelands Complete Maintenance Services Ltd for some reason, Complete Building Services Herts Ltd be awarded the 1-year contract renewable annually for up to a maximum of 4-further years, for the planned installation of gas and renewable energy heating and associated electrical upgrade work to Council-owned properties, being the second most economically advantageous tender received, with a Tender Sum of £187,311.93 with an overall weighted price and quality score of 64.4%;

(3)        That, the overall value of the works be capped to the allocated budgets included in the Capital Programme identified for Gas and Electrical Heating replacements on an annual basis; and

(4)        That, this contract be designated as a serial contract to facilitate the annual adjustment to the tendered rates in accordance with the Royal Institution of Chartered Surveyors (RICS) BCIS ALLCOS Resource Cost Index of All Construction: All Repair and Maintenance Work #7419.  

Reasons for Proposed Decision:

The existing gas and electric heating installations installed in some Council-owned properties were in a poor condition and in need of replacement.  Under the Decent Homes Standard gas and electric central heating are listed as “Key Building Components” and it is recognised that further deterioration could have an immediate impact on the integrity of the building and cause further deterioration in other building components. If gas and electric central heating boilers and components deteriorate further, they have the potential to cause adverse health and safety implications.  

Gas and electric heating installations were major programmes of work within the Housing Capital Works Programme, with gas and electric heating installations and upgrades carried out on a planned programme of work and on an ad-hoc basis.

(a)  Planned gas heating installations require a programmed approach which was undertaken by the contactor and generally required a designated Site Supervisor to oversee the project and manage the planning of the works along with a Resident Liaison Officer (RLO) who will manage Council tenants’ expectations, with both roles provided by the contractor. Planned works generally consisted of a full gas central heating system replacement due to the age and condition of the existing system. 

(b)  Ad-hoc gas, renewable energy and electrical heating installations require a different responsive approach to the work undertaken by the contractor, in some instances, an emergency response was necessary. The extent of the work varies and could be limited to a gas boiler replacement and system control upgrade. With ad-hoc gas, renewable energy and electrical heating installations the tenant was generally aware that the works were necessary. This ad-hoc response means that project planning and the RLO were not necessary and did not from part of this tender approval report. However, having the resources available for gas and electrical heating installations at short notice was essential. 

The existing framework agreement for planned gas, renewable energy and electric heating installations and associated electrical works with the current contractor had reached the end of its term. Therefore, it was necessary to undertake a procurement exercise based on the MEAT taking cost and quality into account to satisfy the Council’s Procurement Rules. 

Other Options for Action:

The main alternative options considered were:

(1)        To re-tender the contract on an annual basis. However, this would be time consuming and inefficient. Re-tendering would not guarantee more competitive tenders.

(2)        To re-tender the works based on price alone. However, this would not necessarily return a more competitive tender and would not identify or quantify a quality commitment from the lowest tenderer. 

(3)        To undertake both the planned programme and the ad-hoc gas heating installations and upgrades combined in one tender. However, the differences between planned and ad-hoc work requires the commitment of varying additional resources being implemented by the contractor. In order to ensure the Council, procure the necessary resources to enable the contractor to undertake the work efficiently and cost effectively, it is necessary to maintain the separation of the planned and ad-hoc gas and electric heating installations. 

(4)        To seek quotations on an individual basis for every planned gas, renewable energy and electric heating replacement project. However, this is very time consuming and is not a cost-effective exercise and given the volume of planned gas and electric heating replacement projects carried out per annum, this would breach the Council’s Procurement Rules C2 (9) with the works exceeding £25,000 in value during one financial year.