ADDING VALUE II. Showcasing examples of good practice in procurement and delivery 09/ 10

Transcription

1 Showcasing examples of good practice in procurement and delivery 09/ 10

2 Compiled by Value Wales, Welsh Assembly Government Further copies of this document can be obtained by ing This document can also be accessed from the Welsh Assembly Government website at: ISBN Crown copyright 2010 WAG F

3 CONTENTS ADDING VALUE II Minister s Foreword 2 Message from Martin Sykes, Chief Executive, Value Wales 3 SECTION 1: Collaborative Procurement & Commissioning 4 Efficiency Benefits of Working Collaboratively 4 Social Care Commissioning 4 A Fresh Approach to Food Procurement 6 Public Sector Update 8 Winning Public Sector Business 14 National Procurement Website 14 The Welsh Purchasing Card 14 The xchangewales Programme 15 Breaking Down Barriers 20 Sustainable Benefits of Procurement 22 Community and Social Benefits 22 Supporting Sustainable Businesses 25 Procurement - Assessing Sustainability 26 Skills and Capability 29 Developing the Procurement Profession 29 Workforce Skills and Capability 30 SECTION 2: Asset Management & Construction 31 Procurement in Construction 31 State of the Estate 33 SECTION 3: Investing in Public Service Improvement 34 Making the Connections: Improvement Fund 34 Invest-to-Save Fund 37 SECTION 4: Looking Forward 38 Meeting the Challenge of Change 38 The Efficiency and Innovation Programme and Board 38 The Collaborative Procurement & Commissioning Board 39 The Procurement Taskforce 40 1

4 Minister s Foreword This report, the second of its kind, is very timely and showcases many examples of good practice in procurement and service delivery from across the public sector. Once again it illustrates that Wales has a strong record in collaborative procurement - stronger than elsewhere in the UK - which it can draw on to guide us through the difficult path that lies ahead. Publishing examples of good practice is very much part of the Assembly Government s approach to efficiency and innovation. At the first Public Services Summit earlier this year the First Minister said that if we are to avoid financial pressure turning into crude public service cuts we have to accelerate the pace of change. Delegates at the Summit were asked to consider what their organisation could do to meet the challenge and what ideas they had for change. There are of course no simple solutions, but we must and I am sure we will, respond positively to this challenge. Our new all-wales Efficiency and Innovation Programme will ensure optimum use of public money. Being driven by an Efficiency and Innovation Board, which I chair, we have set work-streams around collaborative procurement and commissioning, asset management, ICT, workforce re-design, new models of service delivery, and transforming business. High quality initiatives, like the award-winning Value Wales xchangewales project are central to our approach and progress to date on the delivery of this and other procurement initiatives are detailed here. I look forward to seeing the accelerated adoption of such initiatives by public services across Wales so that their considerable benefits are fully realised. This report also includes details of wider collaborative projects; some having benefited from the Assembly Government s Making the Connections or Investto-Save Funds. Such a mix of all-wales action and trialling new approaches, is a key feature of our Efficiency and Innovation Programme. If we are to keep better outcomes at the front of our agenda, we have to be prepared to rethink the way that services are designed and delivered, as well as increasing efficiency. This collection of case studies and other material is only indicative of the many good initiatives being pursued by the public sector in Wales to help deliver efficient and effective services. I will continue to look for other opportunities to capture and cascade the experiences from such projects as they provide vital learning for us all as we move forward. It s never easy going first - being in the vanguard of developing a new approach. I recognise that in securing a successful outcome there will have been some real challenges and a few disappointments along the way. Consequently, the diligence of project-leads in capturing the lessons learned from the project, together with the development of documentation will be invaluable to others when taking forward similar type initiatives. I am confident that your experiences will help us to deliver real efficiencies in the provision of quality public services. I look forward to the approaches illustrated here being picked up and adopted widely across Wales. Jane Hutt, Minister for Business and Budget 2

5 Message from Martin Sykes, Chief Executive, Value Wales I have long been convinced that procurement is about much more than delivering lowest-cost; it has the potential to support wider well-being by encouraging greater sustainability or stimulating innovation and efficiency. Which is why, in the drive for the delivery of efficient and innovative first-class public services at the best possible value-for-money, the Minister s Efficiency and Innovation Programme represents a huge opportunity for all involved in procurement to show that we can accelerate the pace of change and deliver so much more value for the citizens of Wales. I am also delighted that our ground-breaking ICTbased xchangewales programme has been recognised by prestigious UK award panels for its excellence in the delivering of efficiencies. Working in partnership and with the support of colleagues we have seen some solid achievements across Wales. This report picks up on some helpful case studies. I hope these will be inspirational and helpful for those who wish to make real improvements to procurement and the delivery of efficient and effective public services. 106m of realised benefits through more effective collaborative procurement - including the use of procurement frameworks and e-procurement initiatives such as the groundbreaking xchangewales programme. xchangewales delivered benefits of 28.5m (April 2010). Saving 6.5m sheets of paper - equivalent to 701 trees or 42 tonnes of CO 2. Over 28,000 orders with a turnover of 9m have been conducted through etrading. 90% of public sector organisations already benefiting from using Value Wales procurement frameworks. Over 50% of public sector business being won by Wales-based companies (an increase from 35%) including 56% of Local Government business. Over 46,000 suppliers (over half based in Wales) are registered on the national procurement web portal (Sell2Wales/Buy4Wales) with some 11bn of public sector opportunities advertised. Over 300 buying organisations use the system to advertise business opportunities. The Welsh Purchasing Card has reached the milestone of 4,823 cards across 112 user organisations with 913,084 transactions, totalling 151m since its launch in Wales was the first UK country to award a pan public sector contract using European legislation to reserve work for Supported Businesses i.e. companies and organisations where 50% or more of the workforce have disabilities. Launch of the updated Community Benefits guidance which will help those involved in public procurement to build community benefits into their tendering processes. 20 projects are being supported to use social clauses to provide training and employment opportunities. The web based Procurement Route Planner has been expanded to cover Food, Construction and Social Care. The Planner gives support for public sector procurement practitioners. The Procurement Strategy for Construction has been developed with implementation of a range of measures to simplify construction procurement underway. Over 50 improvement projects supported through the Making the Connections Improvement Fund and some 38 efficiency projects supported so far through the Invest-to-Save Fund. 3

6 Section 1: Collaborative Procurement and Commissioning Efficiency Benefits of Working Collaboratively Wales has a strong track record in collaborative procurement. In six years the public sector has banked over 100million of savings through procurement initiatives alone. The recently established Efficiency and Innovation Board (see Section 4) is driving the development of a new and more innovative approach to procurement across Wales. Spending public money wisely is at the heart of the Board s work whilst working in partnership with business for the long-term benefit of the citizen. The following pioneering collaborative projects demonstrate what can be achieved in the social care and food sectors: Social Care Commissioning In recent years commissioning has become established as an important process in helping to drive improvements in social care and securing better outcomes for service users. Social care commissioning involves making decisions about what services are required to respond to the social care needs of children and young people in need, and adults in Wales. It also involves making decisions about the capacity, location, cost and quality of services together with how and who will deliver them. In order to deliver the Fulfilled Lives Supportive Communities (FLSC) 10 year strategy for Social Services, the Welsh Assembly Government has been working with stakeholders to develop guidance and resources to support effective commissioning and procurement in local authorities and their partners across Wales. This work includes: FLSC Commissioning Framework and Guidance which completed a period of national consultation during ; the Value Wales Social Care and Housing Related Support Procurement Route Planner website, which contains over 350 pages of information; a programme to support the development of National Occupational Standards/National Vocational Qualifications for commissioners; and a project to develop a population needs projections tools to inform adult and children services commissioners across Wales. In order to embed this work across Wales a development programme is being established to: support the development of a stronger pan- Wales community of confident, competent commissioners; promote more mature relationships between commissioners and providers; promote a much better understanding of the supply and demand issues facing social care across Wales; effect change in commissioning and procurement practice for social care to be more creative and effective and include a greater focus on outcomes for users; promote better quality service design and development practice by local authorities including community focussed services and co-production; and promote more effective regional procurement practice. The following projects are excellent examples of successful collaborative procurement projects already in place. 4

7 Vision Products, Pontyclun Vision Products, a supported business, is a customer of the all-wales Community Equipment framework, operating from a state-of-the-art facility in Pontyclun. It employs 100 people of which over 50% are registered disabled. Of the 36 people who work on the Community Equipment Service around 75% are registered disabled. Last year the business took two school-leavers from a local special needs school on a trial - they are now making a valuable contribution as permanent staff members. The current site, developed with assistance from the Welsh Assembly Government (DHSS) Stores Integration Grant, is one of the few services to have a demonstration/trial suite, stores facility, manufacturing and refurbishment and de-contamination unit on one site. Enabling it to handle more customers and provide community equipment services to people in Rhondda Cynon Taf, Bridgend and Merthyr and Cwmtaf NHS, serving people who receive care from both hospitals and within the community. Each year the store delivers products worth some 2million, carrying out around 30,000 deliveries. It buys around 700k new product (a third of deliveries) the balance is refurbished and recycled. It repairs around 6,500 products and carries out 15,000 collections. It also manages products for the Welsh Assembly Government grant-funded Telecare programme which allows people at risk to remain in their homes and includes products such as on-line alarms linked to a call centre, bed-sensors linked to carers alarms and home blood pressure testing kits. Vision Products has realised significant savings for its customers - avoiding the need for them to buy new. Customers have re-invested some of the savings by joint-funding the employment of a specialist technician to refurbish equipment for disabled children in a new paediatrics area. The service is also saving Occupational Therapist (OT) time and improving the citizen experience. The demonstration suite allows OT s to bring clients in and try different product options, saving deliveries and collections for home trials. Value Wales will be working with Vision Products and others to integrate the supplier ordering and payment with the xchangewales trading hub. 5

8 South East Wales Improvement Collaborative (SEWIC) SEWIC Children s Commissioning Programme was established, with support from the Making the Connections Improvement Fund, to: improve outcomes for children and young people who are looked after; achieve better value for money; and increase placement choice. A Regional Commissioning Unit has been established working in partnership to achieve these objectives. Together SEWIC have implemented a number of innovative activities as part of its strategy to deliver sustainable efficiencies and improvements for looked after children. Partnership with other public sector bodies like the CCSR, Value Wales and Welsh Data Unit have enabled development of innovative software to facilitate commissioning and contracting activity between local authorities and independent sector agencies. SEWIC has successfully developed and implemented a verification process to ensure quality, commercial sustainability of providers and delivery of positive outcomes for vulnerable looked after children and young people, using xchangewales tools. All SEWIC authorities now use an Individual Placement Tendering Process (IPT) to procure placements based on outcomes for looked after children, and achieve value for money. SEWIC authorities, are building on their successful partnership, and during 2010 SEWIC will formulate a Regional Commissioning Strategy to sustain improved outcomes, achieve value, and improve choice over a longer period. A Fresh Approach to Food Procurement Value Wales buying safe food framework of guidance was launched in March by the Minister for Business and Budget, Jane Hutt, during a visit to Frank s Ice Cream in Ammanford. Public bodies, acting as food business operators, who adopt this approach in their procurement of food will be taking key steps to ensure the safety of food from the time they receive it until the point of consumption. - The Food Standards Agency The safe food guidance was produced in conjunction with the Value Wales Food Group, PMMS (the Value Wales training partner at the time) and the appropriate regulatory bodies. The framework consists of three elements: a new web-based Food Procurement Route Planner (PRP) which guides food buyers and caterers through the whole procurement process; food procurement training courses; and bringing all this good work together - Buying Safe Food for the Public Plate: A New Approach to Food Procurement for Wales which lays out what is expected of public sector organisations and food suppliers to ensure food procurement is carried out to the highest standard and in line with best practice. Some of the benefits of this framework of guidance to organisations include:- the food being bought is safe; suppliers meet the necessary food hygiene standards; common approach to complaints management/ escalation; more structured contract management for food; improved knowledge of food buyers/caterers around food risks and safety; all the information relating to safe food procurement is easily accessible via the Food PRP. 6

9 Value Wales, the Food Group and the regulatory bodies all had an input into the guidance, which has been endorsed by the Chief Medical Officer, the Department of Health and Social Services, the Food Standards Agency (FSA) and the Welsh Local Government Association (WLGA). Food buyers and caterers across the public sector in Wales are encouraged to utilise this guidance and the WLGA are promoting it to local authorities. The guidance is easily accessible on the new Food Procurement Route Planner at co.uk. Buying Safe Food for the Public Plate: A New Approach to Food Procurement for Wales can be found at newsevents/publications/?lang=en. For more information or copies of the guidance please contact karen.coombs@wales.gsi.gov.uk. Organisations and food suppliers alike must ensure the purchase and supply of food is carried out to the highest standards. To drive this, the Assembly Government s Value Wales division and the all-wales Food Group, have worked hard on developing this new approach which sets out our collective aspirations on how food procurement should be carried out. - Jane Hutt We welcome and support this practical guidance which seeks to promote and embed a best practice approach in the purchase and supply of safe food. - WLGA Frank s Ice Cream Last year Carmarthenshire County Council was commended at the True Taste of Wales Awards for the development of its Sustainable Local Food Strategy which was intended to deliver quality products being demanded by the School Meals Service. At the same time, Frank s Ice Cream, a producer of fine quality ice cream established in 1920, won the prestigious Britain s Best Ice Cream Award. This was in addition to the 80 plus regional, national and international awards they had already won. Being in the same geographical area and with the same priority for healthier, good quality produce Frank s (supplier) and Carmarthenshire CC (buyer) had to find a way of getting together. As part of the early engagement of local suppliers that the Local sustainable Food Strategy encourages, early discussions between the two organisations were encouraging and revolved around an ice cream product that Frank s were developing which seemed to fit in very well with the healthy eating ethos that was being strongly pursued by the School Meals Service. Being able to serve a healthier ice cream with fresh fruit was an appealing prospect. In terms of quality the Council could be confident that they had an opportunity to work with an innovative and committed local company. Frank s in turn had seen the commitment from officers of the council and felt together they would make a strong team. 7

10 Public Sector Update The whole of the wider public sector has been responding to the procurement challenge to transform procurement and commissioning. The following gives a snap shot of what is happening across the sector. Value Wales Working to an All Wales Sourcing Strategy and Plan, endorsed by the Heads of all Purchasing Consortia in Wales, the Value Wales collaborative procurement team works across the public sector to develop effective collaborative procurement agreements. Value Wales awards and manages framework agreements on an all-wales basis. Some are tendered directly, others through external lead bodies. The framework agreements drawn up so far under the Plan have already realised 106million of real savings (exceeding targets) whilst at the same time reducing duplication and delivering better economic, environmental and social outcomes. Snapshots of the wide range of projects managed by Value Wales includes: Denbighshire Council will save a projected 90,000 (almost 30% on previous annual spend) by joining the all-wales voice telephony collaborative procurement exercise. Since 2008, Value Wales have saved the public sector over 3.6million through an All Wales Agreement for provision of Media Advertising services. The framework was established with the support of HR professionals across Wales and has allowed the wider Welsh public sector to access discounts through the Central Office of Information (COI) for the first time. Value Wales and Welsh Health Supplies led a project to set up an all-wales framework for routine community equipment (such as hoists, commodes and disability aids). The framework will save an estimated 26% - projected to be worth over 1million per year and the standardisation of products of a good quality - considerably reducing the post-code lottery impact of the current service structure. All products now meet the European harmonised quality standard. The Welsh Further Education Purchasing Consortium led on the I.T. framework agreement which provides the Welsh public sector with wide choice across a range of I.C.T. products and services. The core products meet energy efficient minimum specification requirement, making available low energy consumption products at a competitive price from a range of manufacturers, resellers, national and local companies. In 2009, Value Wales and the University of Wales Institute Cardiff awarded a Vehicle Hire framework agreement for the hire of a wide range of cars, light and heavy commercials, and specialist vehicle types. The framework gives access to competitive hire rates together with a choice of energy efficient vehicles, thus reducing costs and carbon emissions. The framework is divided into a number of geographical lots providing customers with a choice of both local and national suppliers. It is estimated that most users will see an average 16% price reduction in rental charges. 8

11 Higher Education The HE Sector is demonstrating on-going progress in collaboration with procurement strategies being linked to government procurement policies. All of the Higher Education Institutions are now members of the Higher Education Purchasing Consortium Wales (HEPCW) which promotes collaborative working with sector commodity groups. Average procurement savings of around 12.6million were delivered in 2008/09 representing a percentage saving of 3.2% - exceeding Welsh Assembly Government and HE Funding Council targets. A 16% increase over the previous year. Cross-sector collaboration is increasing e.g. University of Wales Institute, Cardiff led on the all-wales Car Hire collaborative arrangement and is providing procurement expertise to University of Wales, Newport and the Sports Council for Wales. Glyndwr University is providing procurement expertise to Yale College. The South West Wales Higher Education Procurement Partnership s (SWWHEPP) joint procurement unit, will continue as it has demonstrated success in collaboration in procurement. The cost of the unit will in future be shared between the three partner institutions. E-technology is increasing with the successful use of purchasing cards schemes, use of Buy4Wales website, Procureweb website, investment in new finance and purchasing systems and use of e-tendering and e-sourcing tools. The sector will also be leading the High Performance Computing Wales collaborative project. This ambitious project aims to build a globally recognised high-performance computing capability across Wales, providing an enabling technology and building a skills base to support research and development projects that deliver significant benefits across Wales and beyond. The project includes plans for a new supercomputing institute for Wales. HEPCW has led on a collaborative procurement training fund project for staff who have procurement responsibility as part of their role. Excellent feedback has been received. Details follow: Procurement Training in the HE Sector Reviews of procurement within the HE sector in Wales, conducted by independent consultants, have identified a broad range of procurement training needs for each of the institutions. With the support of this evidence, the Higher Education Purchasing Consortium, Wales (HEPCW) successfully bid for funding from the Higher Education Funding Council for Wales (HEFCW). This funding will support a 2 year procurement training and development programme to address the skills shortages in the areas identified in the independent reviews. The training will be targeted at individuals who have responsibility for departmental purchasing, but are not part of the formal institutional procurement function. The funding has been provided to support the training needs of the whole of the HE Sector in Wales. HEPCW is managing the training fund on behalf of its members in South and West Wales, whilst the 2 North Wales institutions have been allocated with the funding identified in the Business Case, and are responsible for managing this in line with their procurement training needs. In 2009/10 the HEPCW programme is concentrating on delivering training in 3 distinct phases: a procurement essentials course delivering an overview of procurement principles; a session covering tendering and EU legislation, providing delegates with relevant knowledge including the legal requirements, award criteria, standstill periods etc; a session based around the management of suppliers for delegates who actively manage live contracts and are involved in renegotiation, supplier performance monitoring etc. All of the courses are free to delegates from HEPCW member institutions, and are being held in Aberystwyth, Cardiff, Glamorgan and Swansea. Feedback on the courses held to date has been very positive, and future courses will be adapted and developed to address delegates comments. 9

12 The NHS 2009/10 has been a year of significant challenges for the NHS in Wales including having to deal with swine flu, the reorganisation of the structure within Wales and last and not least the general challenging economic climate. The organisational changes brought their own challenges with many staff changes across the new Health Boards impacting on the well established network of professionals who support the work of procurement. This year also brought with it changes to Standing Orders and Financial Instructions and changes in EU Procurement Legislation - all key challenges for the contracting teams across Wales. The collaboration agenda continues to be important for both the NHS and the wider Welsh public sector. In support of this Welsh Health Supplies (WHS) undertook the negotiation of the contract for Community Use Items which was aimed at both the NHS and Local Authorities. The process was difficult but the outcome has demonstrated what can be achieved through collaboration. The NHS in Wales has also embarked on a sustainable development journey as it progresses towards the Level 3 Sustainable Procurement Assessment Framework (SPAF). Establishing the baseline for our carbon footprint is another challenge. And finally there has been a variety of work undertaken on Collaborative Projects which the Assembly Government through Value Wales have driven. The WHS has also been successful in its bid for Invest-to-Save Funding and a team is being established which has identified clear opportunities to make savings and drive real collaboration across Wales. The other main focus has been on the xchangewales programme as both the North Wales BSP and Cardiff and Vale UHB put significant effort into integrating the system into Oracle. There are a number of other major initiatives that will take shape as we move through The work already started on Shared Services will clearly impact on WHS and the role that people play in the future. In addition the Welsh Assembly Government Efficiency and Innovation programme is an opportunity to reshape the way we support front line services and the citizens of Wales. The importance of quality and continuous improvement to NHS Wales has been clear over many years and it was very noteworthy that WHS won the overall 2009 Wales Quality Award (see case study). Wales Quality Award In December last year WHS won two awards, the People Development award and also the Overall Quality Award in the 2009 Wales Quality Awards. The WHS has been at the heart of procurement in the NHS Wales for many years and since its inception has tried to respond to the changes that have taken place within the Service. Constantly striving to achieve a culture whereby quality is the norm and all members of staff see continuous improvement and best practice as the way to achieve business success. One of the significant outputs of this has been the level of savings for the NHS in Wales during an extremely challenging economic period with 13.5million achieved in 2008/09 and reinvested into front line patient services. WHS works primarily on behalf of the NHS Organisations in Wales and the Welsh Assembly Government, and customer satisfaction is one of the main cornerstones by which we measure success. The Wales Quality Centre has been working with the WHS over a number of years in the use of the EFQM model and providing valuable feedback which is used to inform and drive forward the quality agenda. 10

13 Further Education Cheryl Brown, Welsh Further Education Purchasing Consortium Manager said: Having notched up ten years of operation, the WFEPC is certainly proving value for money for the further education sector. Through the WFEPC s frameworks, in the last financial year alone, colleges have saved over 1.5million. The WFEPC offers framework agreements that reflect the specific needs of the sector, as well as procurement resources for colleges who do not have in-house procurement expertise. Two new frameworks have been awarded recently: Arts Materials and Legal Services - both of which include local companies. In addition, the WFEPC is also addressing the challenge of living within environmental limits: the WAG-funded WFEPC Sustainable Procurement Project has completed successfully with every target FE college completing the WAG s Sustainable Procurement Assessment Framework (SPAF) and Action Plan. These developments come at a time when, more than ever, further education colleges need to ensure they have access to professional procurement services: the further education sector has faced a series of challenging budgets and the future looks set to deliver funding cuts over the next few years. In addition, as part of the Welsh Assembly Government s agenda to transform post-16 education, a number of colleges have merged - and more mergers are likely to follow over the next few years. The WFEPC is proud to be playing a key role in helping colleges to meet the challenge of cutting costs while raising quality. Local Government Local Government through its four Regional Partnership Boards and its collaborative procurement arrangements are committed to improving the efficiency and outcomes of public services delivered by local government, often in partnership with other public service providers. The first phase of collaboration between 2006 and today has provided local government with valuable learning and established partnerships and shared services and will help future joint working. Specifically, Local Government through the North Wales Procurement Partnership and the Welsh Purchasing Consortium are targeting delivery of 11-17million savings over the next 3 years. Improvement through better procurement is a key aspect of the local government efficiency agenda. All 22 local authorities participate in some, and in many cases all, of the sector wide procurement frameworks, which are led by various public sector organisations, often with support from Value Wales. The frameworks cover areas such as IT Equipment, photocopiers, vehicle hire, media advertising and mobile phones. Local government has to March 2010 saved some 11million on 64million of expenditure through the use of Value Wales supported frameworks alone. Better procurement remains essential to the delivery of greater efficiency and public service improvement and a new generation of projects are already in the making across local government, a number of which are illustrated in this document: Carmarthenshire s benefits of wider contract advertising case study (page 21); Cowbridge school new build procurement in construction case study (page 32); North Wales Procurement Partnership xchangewales eauction case study (page 18); Community Benefits RCT Church village bypass case study (page 23). 11

14 Emergency services The Emergency Services are fully embracing collaborative procurement both within and across the different sectors. The Fire and Rescue Service has since 2008 developed an all-wales Fire and Rescue Service Procurement Strategy and has been active in developing various cross sector as well as within Service projects under its action plan. A number of collaborative projects are ongoing at strategic and operational level. The Welsh Fire & Rescue Service, through the CFOA Wales Procurement Group, sets policy and strategy and is represented at the CFOA (Chief Fire Officers Association) National Procurement Board. Collaborative projects include: Cross Sector Collaboration - A joint Emergency Service (Mid & West Wales Fire & Rescue Service and Dyfed Powys Police Authority) and HMCS (Her Majesty s Courts Service) project for a proposed new facility located at Llandrindod Wells. (See page 36) Sector Collaboration - Recently awarded contracts include: The Welsh Fire & Rescue Service training provider framework which utilised the xchangewales electronic tendering portal. The project has an anticipated value of 3million over four years and having been undertaken electronically, saved time and paper in what was a very complex evaluation process. The Welsh Fire and Rescue Service contract for Personal Protective Equipment, a project to deliver the most technically advanced state-of-the-art fire kit across Wales. The procurement model used utilised an existing framework to reduce risk, time and cost. The purchasing organisation also assisted in the mini-competition. By collaborating as a sector, purchasing power was maximised and through sharing the project administrative burden and minimising duplication of effort and overheads it became a far more affordable excercise. The partnering approach, whereby both customer and supplier formed a collaborative project team, allowed input into the fine detail of the finished design, based on user feedback, concluding in a bespoke garment with a unique WF&RS identity. The cross-service project group worked so well that this model is likely to be replicated for other collaborative procurements. Other developments include: Mid & West and South Wales are signed up to the xchangewales electronic procurement programme and adoption of the e-tender package including implementation of the contract management module. They have also established a sustainable development policy to compliment and strengthen the ongoing work in sustainable procurement. Both organisations have undertaken organisation wide assessments utilising the Sustainable Procurement Assessment Framework (SPAF ) tool. By collaborating on the action plan the Services are progressing towards the required Level 3 and furthering the sustainability agenda. 12

15 Mid and West Wales Fire & Rescue Service have introduced a new wide area network service throughout the Service to support existing Internet Protocol voice facilities and new faster Internet access. This was procured through the Assembly s Public Sector Broadband framework and is valued at just under 1million. They have also completed the electronic purchase to pay (P2P) system and been rolled out to all departments, a shared service with Carmarthenshire County Council. The four Police Forces have established an All Wales Procurement Board supported by an All Wales Police Contracts Group. The Police Authorities of Wales earlier this year approved the Principles of an All Wales Procurement Strategy. The group is in the process of finalising a joint forward plan for future collaborative contracts. Other projects and milestones include: working towards common standing orders on contracts and terms and conditions of contract; agreement reached on an All-Wales e-procurement strategy; agreement of a standard performance framework using the Audit Commission Performance Indicators; Welsh collaborative contracts having been established for the following commodity areas: - Media advertising; - Internal audit service; - Monitoring and audit software; - Single non emergency number. Collaborative tenders underway include: - Blackberries for mobile data; - Paper; - Translation service; - Photocopier rental; - Cleaning consumables; - Legal services with local authorities (North Wales). In addition to the above, the forces participate in police service consortia with forces in the north-west (North Wales) and southwest (southern Wales forces) of England. These consortia are long established and contract for police specific commodity areas as well as other more generic requirements. North Wales Police have established an SLA to provide a procurement services to North Wales Fire and Rescue Service. For several non-specific police goods and services, the Welsh Forces take advantage of frameworks managed by Value Wales and play an active role in assisting Value Wales in some of the activities they are involved in, which in turn benefit us e.g. National Procurement Website refresh An ACPO (Association of Chief Police Officers) Sustainable Procurement Working Group has been set up to support and assist police forces in developing their sustainable procurement strategies. The Welsh forces are represented on the group by Devon & Cornwall and North Wales. The group aims to share best practice, assist in developing national templates and sustainable reporting. It is expected that a toolkit will be available in Autumn

16 Winning Public Sector Business With an expenditure of 4.3billion per year, how Welsh public sector procurement is carried out has a profound impact on the economy. Over 50% of this spend is won by businesses in Wales, including 56% of Local Government business. Representing about 10% of Wales national wealth public procurement it is an important area for quality goods and services. For a number of businesses in Wales success in winning public contracts provides a firm base from which to grow. The development of a competitive and vibrant supply base in Wales, engaged with and supporting innovative, efficient and effective public services has to be our ultimate ambition. It is therefore imperative we do all we can to help the public sector and suppliers grasp the opportunities available to them and help break down both real and perceived barriers to doing business so that a consistent approach to procurement can be delivered across the public sector in Wales. Examples of how the Welsh Assembly Government has been helping suppliers and buyers to do business include: National Procurement Website (NPW) Developed and operated as a partnership between the Department of Economy and Transport and Value Wales the NPW is the first pan-wales cross-sector procurement website which is free, is extensively used and is a model others are following. Its major components are: - used by most of the Welsh public sector in Wales (Local Government, Education institutions, NHS, etc) to advertise their tendering opportunities. It is used by the Welsh Assembly Government as its primary sourcing tool to select suppliers who have already registered their details on Sell2Wales. - aims to help small and medium sized companies work successfully with public sector clients. The website aims to list all public sector contracts advertised in Wales and is used by the Welsh public sector to identify business and invite them to quote for work and tender for contracts. The latest statistics on the NPW are very encouraging with some 300 Welsh procurement organisations registered with over 3,250 procurement users. Published notices have grown to around 167 per month with a total of some 7,800 notices published to date. There are currently over 46,000 suppliers registered with over 22billion notices advertised, including over 11billion in contracts. The website also gives access to the Procurement Route Planner, schools and subcontract access, contracts and resources, Value Wales Investment database and the Supplier Development Service with a Supplier Qualification Information Database under development. The website is being upgraded. The functions and facilities offered by the NPW will be improved by offering better performance, upgraded infrastructure and new functionality. Buyers and suppliers can look forward to a simplified buying journey, improved risk assessment and easier sharing of supplier details with collaborating esourcing suppliers. The newly refreshed site is expected to be launched by the end of The Welsh Purchasing Card The Welsh Assembly Government and the Royal Bank of Scotland (RBS) have been working together to provide the Welsh Purchasing Card (WPC). Following the completion of a call-off competition the RBS have been awarded a contract to provide WPC for a period of 2 years (from 1 April 2010) with an option to extend for an additional 2 years. 14

17 Service and support provided to existing customers will continue uninterrupted. The procurement card is a low-cost method of ordering and paying for low-value, low-risk items, is available at no cost to organisations of any size and is accepted by a huge range of merchants. This makes it suitable for buying virtually any type of goods and services. Buyers do not need a purchase requisition or purchase order to pay for goods or services with the card. Furthermore, it eliminates the process of separately invoicing every order, with one monthly payment to the bank. The card also benefits suppliers, providing rapid payment within 4 days. Suppliers can take advantage of further benefits, including reduced administrative costs and preferred supplier status. The card is also a useful epayment toll within the xchangewales programme. Free support from xchangewales and the Royal Bank of Scotland is available to set-up and manage all aspects of the cards programme. The use of the card is growing with over 4,823 cards being used across 112 organisations completing over 913,084 transactions, with a spend of over 151.9milion since its launch in The xchangewales Programme This year has seen significant progress for the xchangewales programme, delivering benefits of 28.5million by the end of April This means a contribution to our sustainability targets by potentially saving 6.5 million sheets of paper - the equivalent of 701 trees or 42 tonnes of CO 2. The xchangewales programme aims to deliver electronic procurement to Welsh public sector organisations, creating efficiencies, stimulating greater collaboration, ensuring fair, efficient, transparent processes; and by doing so supporting the lowering of the cost of doing business for both buyers and suppliers. The programme will enable the Welsh public sector to generate over 70million of benefits over its five year life-span. In Autumn 2009 joint xchangewales and Department of Enterprise and Transport Opening Doors to Opportunities events brought together the buyer and supplier communities in North and South Wales. These events focused on the procurement challenges facing both sides of the sector. Speakers from Public Sector pathfinder organisations were joined by specially selected suppliers to present their experiences of trading with eprocurement tools and services. The Assembly Government Ministers who addressed their individual events urged both the supplier and buyer community to engage with the xchangewales programme so that in the current economic climate they could take advantage of the benefits and efficiencies of eprocurement practices. The programme s achievements were recognised in this year s Government Computing (GC) Awards where xchangewales beat off contenders from across the UK to win the Delivering Efficiencies category award. The programme was shortlisted as a finalist in the GO (Government Opportunities) Awards in the Collaborative Procurement Initiative of the Year category. 15

18 xchangewales products and services etrading: Ten organisations are now electronically trading through the hub. Leading light organisations Caerphilly County Borough Council, Grwp Gwalia Housing Association and Gwynedd Council have been joined by 6 other Local Authorities: Cardiff, Bridgend, Rhondda Cynon Taff, Torfaen and the City and County of Swansea as well as the Welsh Assembly Government. The first of the Local Health Boards - Cardiff & Vale University UHB has now gone live with full roll out to all of the NHS expected during 2010/11. Public sector organisations trading through the hub have access to regional and national collaborative frameworks as well as their normal supplier base, ensuring that they consistently achieve best value for all goods and services purchased through the hub. The number of Purchase Orders pushed through the system has risen significantly to over 28,000, with a turnover of 9million. Other organisations are also benefiting from more efficient procurement processes. For example, Grwp Gwalia Housing Association: Grwp Gwalia Housing Association Previously using a primarily paper-based procurement system with a high degree of uncontrolled spend, and an average 8 days to process an order, xchangewales etrading was an ideal solution for Grwp Gwalia. Ready access to Public Sector national, regional and local collaborative framework agreements, the visibility and auditability of spend, and the contribution to sustainability further underlined suitability. etrading is also a bilingual system, vital for an organisation with distributed offices across the whole of Wales. xchangewales etrading integrated with Gwalia s existing financial management system. Benefits achieved have been: Visibility and control of spend across the whole organisation; Alignment of invoice and purchase order. Finance staff have reduced process timing by 71%; Better value for money; Front line workers focused on front line work. 42% reduction in time spent sourcing and ordering goods/services; Process efficiencies. A 9 step P2P process has reduced by 73% to four steps; Supplier benefits. Speedier payments supporting increased cash flow and a reduced use of paper contributing to green efforts. By the end of the financial year 2009/10, 6809 Purchase Orders and 4111 invoices had been pushed through the system, with a turnover of just under 2million. This in turn has realised benefits of just over 214k and 47k via Purchase Orders and invoices respectively. In terms of sustainability, this translates to 355kgs of CO 2 and over 54,000 sheets of paper - or 6 trees. xchangewales etrading is now embedded as standard business practice within Grwp Gwalia. Procurement has been transformed from a longwinded manual paper based system to a fully integrated, efficient eprocurement solution. 16

19 etrading for Schools: With schools increasingly facing procurement challenges the etrading for Schools portal provides schools with a secure electronic environment for best value purchases through access to collaborative framework contracts. There is no charge for schools and it integrates seamlessly to their SIMS financial management system, supporting the modernisation and standardisation of procurement processes. Using keywords or codes, online catalogues from regional and national suppliers, can be searched comparing items to ensure best value for money. In addition the Request for Quotation function provides the facility to contact suppliers for prices on complex items and services or those not readily available through catalogues. Reduced time taken on procurement activities means that staff are able to focus on core teaching activities. Robust, repeatable and auditable workflow and approval processes provide greater control over spend. Four Local Authorities have implemented this specially tailored eprocurement system in their schools. The City & County of Swansea, Vale of Glamorgan Making the most of technology in Peterston Having successfully piloted the xchangewales etrading for Schools, Vale of Glamorgan Council is now rolling it out to all 59 of its schools. Peterston Church in Wales Primary School, with 180 primary and nursery aged pupils, has become one of the Council s etrading for Schools pioneers. School staff, including teachers, used to trawl through paper catalogues and CDROMs detailing pricing arrangements to source goods and services. Now, sourcing is completed by the school s administrator using the search and compare functionality. With online prices always up to date, and orders processed electronically the school has found that invoice mismatches are now minimal. This has led to and Cardiff City Councils have all adopted a staged approach to the roll-out of etrading for Schools. Over 30 schools in these areas are currently using the system. Whereas, pathfinder organisation Gwynedd Council has 117 Primary and Secondary schools trading, with three special schools coming on board early 2010/11. Gwynedd s success in the implementation of etrading for Schools was recognised at the Local Government Chronicle (LGC) Awards in March, where they achieved the Highly Commended accolade in the Procurement category. Minister for Business & Budget, Jane Hutt visited Ysgol Tryfan, Bangor, the first school to trade electronically. Schools in Gwynedd will further benefit from the introduction of einvoicing later this year. Schools praise the way the system allows them to search and compare goods to ensure they achieve best value for money purchase orders with the value of 596k had gone through the etrading for Schools system by the end of June efficiencies where time-consuming manual adjustment of price and VAT has reduced. The school has also found that order processing & delivery times have improved. Peterston Church in Wales Primary School is now one of twenty schools in the Vale of Glamorgan using the etrading for Schools system. Implementation at the rest of the schools in the Vale will be completed over the course of the financial year. 17

20 esourcing: The portfolio of services available through esourcing continues to be popular with public sector buyers and suppliers. esourcing has been responsible for 6.3million of benefits over the last financial year. Buyers and suppliers use the Welsh Assembly Government s National Procurement Website (NPW) as their esourcing tool. The etender tool supports the sourcing process by helping buyers to manage the entire tender process electronically; and for suppliers to submit their documents electronically. Savings in administration, paper and postage costs are significantly reduced for both parties. The number of tenders managed with this tool have tripled in the financial year to 315, totalling 306million. Efficiency savings of just under 495k have been realised with a potential saving of 165 trees. econtract Management provides a secure repository for contracts. Totally integrated with etendering, it allows the automatic creation of contracts, and supports contract management from set up to expiry, monitoring KPI and supplier performance. Over 2200 contracts are now securely managed on this basis with a value of 2.73billion. The eauction tool allows public sector buyers to dynamically negotiate with their suppliers in a live auction - cost, quality and other criteria are automatically taken into account to indicate which bid is the most economically advantageous, ensuring best value for money. Examples of savings made through the use of this tool are: Denbighshire County Council - home to school taxi services - saved 199k over the life of the contract (23%). Flintshire County Council - home to school taxi services - saved 234k over the life of the contract (17%). eauction adopted by the North Wales Procurement Partnership The North Wales Procurement Partnership (NWPP) took their first step into electronic auctioning when renewing home-to-school taxi contracts at Denbighshire County Council. Operator awareness sessions were run for suppliers new to the process to introduce them to the tool. Suppliers were able to see that moving away from paper-based responses would speed up the process and reduce administrative costs, such as paper and postage. Twenty-two lots were auctioned through the xchangewales eauction tool with a contract value of just over 878k. Cumulatively, 232 supplier responses to the auction were received. In this instance, the auctions realised a saving of just under 23% over the life of the contract, totalling 199,700. This success has encouraged other North Wales Local Authorities in the Partnership to embrace xchangewales eauctions. Fintshire County Council followed by running a series of seven auctions, again for home-toschool transport and taxi services. Over and above the competitive tender savings an additional 163,000 was achieved through the eauction process. These savings were underscored by an improvement in quality, rising 6% to 77%. Earlier this year Denbighshire, Flintshire, Conwy and Wrexham conducted further eauctions for similar passenger transport services. Collaborative working in this category has reaped further benefits through the development of standard terms and conditions and shared templates holding standard question sets. These benefit both buyer and supplier, preventing duplication of effort and ensuring consistent responses. The initiative has now been rolled out across a number of local authorities in North Wales. By adopting eauctions, the NWPP on behalf of their constituent members have already delivered over 1.5million in savings. The xchangewales programme anticipates the NWPP s success will encourage further Local Authorities to engage with the esourcing tools. 18

21 epayment: The Welsh Purchasing Card (WPC) is proving a useful epayment tool within the xchangewales programme. It has had a particularly successful year, having reached the milestone of over 100 Public Sector organisations benefiting from its use. Over the year these organisations have used their card to make over 250,000 transactions, with a purchase spend of 39.5million. (Captured spend over the life of the xchangewales Programme has reached 72.5million, through just under 500,000 transactions). Participating organisations have benefited from combined transaction savings of 7.0million in the financial year 2009/10 (based on process savings of 28 per transaction), and a shared rebate of over 200,000. Delivering value and efficiency to Llanelli Rural Council Llanelli Rural Council (LRC) is one of nine community councils in the Llanelli district. One of the key services the Council provides to the local community is occupational training - providing access to training for local job seekers referred by the Job Centre. Job seekers only have a short 13 week period in which to apply and access training and qualifications through the Job Centre scheme. LRC is responsible for supporting this process, booking learners on to courses and securing dates for assessment tests. Using the WPC to make these bookings has significantly reduced the time between sourcing and booking a course. Previously the process was administration heavy eating into the valuable 13 week period. Now card users simply go online to book the most suitable dates for learners. Booking is completed quickly and payment is processed through to training providers within 3 working days. Card usage is controlled with spend limits set by the Council s Management Team. With these limits agreed in advance, the training department is easily able to manage their budget - a great advantage for the Council. Details on the Council s cards can be viewed securely by any authorised personnel via the Smart Data OnLine (SDOL) card management system, provided free of charge with the WPC. For Llanelli Rural Council, the resulting efficiencies in time and money saved has helped them provide a better service to their job seeking customers. 19

22 Looking ahead The xchangewales Programme will continue to focus on increasing eprocurement penetration across the public sector in Wales, with emphasis on the further engagement of Local Authorities with etrading. This supports the approach adopted by the Efficiency & Innovation Board (see Section 4). The EIBs procurement workstream agreed that all Local Authorities will be asked to sign a Memorandum of Understanding (MoU) and commence work to map out the efficiency and business benefits of adopting the xchangewales programme and to complete investment business cases by the end of September Denbighshire and Monmouthshire Councils have already signed the MoU. They are joined separately by Pennaf Housing and Glyndwr University. Organisations already trading electronically through the hub will be supported through the implementation of einvoicing. Caerphilly County Council will be the first organisation in this financial year to adopt this, contributing further to efficiencies and sustainability targets. For more information go to Breaking Down Barriers The recommendations around pre-qualification processes in the Barriers to Procurement Opportunities for SMEs report published last year are being implemented jointly by The Department for Economy and Transport, and Value Wales. The newly developed Supplier Qualification Information Database (SQuID) provides a set of questions commonly asked at the selection stage of a procurement and a means of storing suppliers answers for re-use. Its accompanying guidance suggests a risk-based method of choosing questions, which is proving very popular with buyers and suppliers. The questions and guidance have been developed in wide consultation, and the paper version is being tested in an active consultation over the summer. The xchangewales team is leading a series of workshops with buyers and suppliers over the summer. This will inform the development of the new Sell2Wales website, which will host the SQuID and its guidance. Another aim of the Breaking Down Barriers work is to advertise more low-value opportunities, and Value Wales are investigating the impact that advertising all contracts with values above 25k on Sell2Wales is having on workload. See the case study for more on this. For more information please karen.coombs@wales.gsi.gov.uk 20

23 Benefits of Wider Advertising: Carmarthenshire County Council In response to signing the Opening Doors Charter for SME-friendly Procurement we have been advertising all contract opportunities with an estimated value over 25k on Sell2Wales since the middle of A brief study of our records has revealed some quite fascinating and startling results! 72 adverts have been put on Sell2Wales since mid-2007, of which 40% have been for contracts with values below OJEU thresholds. 10 of these contracts had values of 25k and below. Despite our procurement staff being apprehensive to find that an advert had been ed to several thousand suppliers, the response has not been worryingly high. - Below OJEU thresholds the average number of responses is 8 and for contracts with values of 25k and below, the average number of responses is Above OJEU thresholds (excluding Part B services) the average number of responses is 16. We have has also identified a small sample of 4 renewable contracts which have been re-let since the decision to advertise on Sell2Wales. These indicate that there has been a 40% increase in the number of PQQs received since advertising via Sell2Wales. Although this is a very small sample, it supports the sense amongst our procurement staff that the workload has gone up, but not dramatically. We feel that 40% is a manageable increase, and actually may reflect an increase in genuine competition that may be delivering value for money. These results are fascinating, as they could indicate that the widespread fear that advertising all contracts over 25k on Sell2Wales would result in unmanageable workload is unfounded. However, there is one very important factor to take into account. Over the same timescale we have adopted a rigid policy of doing all the groundwork for a procurement before an advert is placed. 18 PIN notices have been placed over the same period and supplier conferences are held frequently. The Sustainability Risk Assessment tool is also used routinely. This means that full specifications, evaluation criteria, etc. are all ready before adverts are placed. In addition, and partly as a result, we are now making more use of the Open Procedure (74% of all OJEU procurements, excluding Part B Services, have been via the Open Procedure). Perhaps the most surprising finding of all is that: Open Procedure - average number of bids = 10 Restricted Procedure - average number of PQQs = 32 It is a surprising result, because it is generally held that the Open Procedure will result in more responses. Of course, these are not like-for-like comparisons, and some of the Restricted Procedure procurements were for complex multi-lot frameworks where we knew the response would be high. However, this does not take away from the fact that an average of 10 bids on an Open Procedure procurement is not high - and this must be (at least in part) because giving the full specification up-front allows bidders to self-deselect. Self-deselection of unsuitable bidders is an efficient outcome that benefits buyers and suppliers alike. Carmarthenshire is a largely rural county and it could be argued that the results here would not be replicated for a public sector organisation in an urban area. One further figure is of interest: around 66% of all our contracts advertised below OJEU thresholds have been for services, rather than supplies or works. In very general terms, services contracts might attract more bidders from further afield. 21

24 Sustainable Benefits of Procurement The Welsh Assembly Government recognises the substantial investment the public sector in Wales makes through its procurement spend and is continually looking at ways that even more value can be obtained. All those involved in spending public money are being urged to get maximum value for every pound we spend but in addition public procurement can make an enormous difference to the social, economic and environmental well being of Wales. Procurement can also offer opportunities that will make a positive impact on local communities through recruitment and training of economically inactive people, making a positive impact on the environment and contributing to the local area in terms of education, regeneration and community engagement. Value Wales has been recognised for its innovative approach to corporate social responsibility and sustainability by beating off contenders from across the UK to reach the final of the 2009 and 2010 prestigious UK GO Awards. Community and Social Benefits Following the success of 3 pilots, Value Wales developed the Community Benefits methodology in 2006 which has supported the public sector in delivering benefits for their communities through their procurement decisions. However, the economic climate and developments in other sectors, has required a review of the guidance to ensure procurers receive a consistent message and are fully equipped to maximize the value of every pound spent on behalf of the people of Wales. The Assembly Government s Value Wales division and the Community Benefits Project Team have worked hard on developing new guidance to help those involved in public procurement to build community benefits into their tendering processes. The revised Community Benefits guidance, launched in April, remains focused on improving training, education, and recruitment opportunities but also provides guidance on supply chain initiatives, equality in the work place, improving the environment, and helping the disadvantaged communities. The guidance can be found at improvingservices/publicationsevents/publications/ commbenguide/?lang=en The guidance also refers to the Welsh Assembly Government s helpful Can Do Toolkit which includes practical guidance for social landlords on using targeted recruitment and training (TR&T) as a core requirement of contract. The guidance encourages purchasers to use their purchasing powers to enable job and training gains. It is already being adopted by housing projects in Wales. Around 20 projects across the public sector are adopting the community benefits approach, with many more underway in the housing sector. The Rhondda Cynon Taff/Costain Church Village Bypass project and the construction of the Welsh Assembly Government building at Llandudno Junction clearly demonstrate the benefits of adopting this approach. 22

25 Church Village Bypass The Church Village bypass, a Rhondda Cynon Taff (RCT) scheme with Costain, is an excellent example of how added value can be achieved through public procurement spending. RCT was one of the original 3 pilots into social clauses in procurement. The success of their Porth Relief Road scheme led to the development of the current methodology as it exists today. The Church Village bypass will relieve traffic congestion in the settlements of Church Village, Ton-teg, Llantwit Fardre and Efail Isaf within Rhondda Cynon Taf by improving the A473 which is the principal route between Talbot Green and Ton-teg. The road being constructed is approximately 7km of 7.3m wide single carriageway to include the realignment of other minor road and connections via Four Roundabouts. A community route, providing facilities for pedestrians and cyclists, will cover the full length of the scheme. Environmental improvements include mitigation measures for great crested newts, dormice, badgers, bats and marsh fritillary butterflies. The Project Team have set out to achieve benefits through the delivery of the scheme and set itself tough targets to achieve during the scheme build across the full scope of sustainable procurement economic, environmental and social benefits. Achievements include: Creation of 70 posts and training to a minimum standard of NVQ 2; Creation of 3 jobs targeted toward the employment of prolific offenders (working in partnership with Community Safety Partnership, the Probation Service and the Prison Service); Facilitate New Start of at least 1 new business in the area; By opening up existing supply chains, providing business support and advertising 2nd tier opportunities on Sell2Wales achieved a target of 75% of all subcontracts awarded to local companies in Wales and 75% of supplies sourced locally (and helped to develop and improve those companies through the establishment of a Church Village Business Club); Provided work experience to 15 pupils sourced from local secondary schools; Provided 100 days of support for the Safety Zone - a partnership to provide construction site safety training to 1000s of school children; Work via the Education Business Partnership providing input to the World of Work programme and work with local schools to establish an education zone within the visitor centre. This has interactive displays showing how the team are working hard to minimise their impacts on the local environment, ecology and geology; Eliminate off-site disposal of surplus inert materials excavated from the work. This includes the re-use of over 500,000 tyres along the route of the site and the reuse of 250,000m 3 of earthworks on the site; Achieve CEEQUAL(the environmental standard for road schemes) excellent rating; Segregation of any waste and recycling to approved sources; A waste measurement tool to measure the carbon footprint on the scheme and utilisation of state of the art energy efficiency facilities at their site offices; Use recycled content in materials at a minimum of 50% for the scheme; Achieve an offsite skip waste disposal of only 1 skip per 1million of project expenditure. 23

26 Llandudno Junction Office The Welsh Assembly Government has incorporated community benefits into the construction of its new building at Llandudno. Achievements include: following a Meet the Buyer event held jointly by the Welsh Assembly Government and Pochin in 2009, over 400,000 worth of work has been won by local businesses; 8.7million, has been committed locally throughout the construction project; over 50% of the workforce on site are from the local area; local people have also secured employment providing security and catering services to the site; the construction company Pochin were audited twice as part of the Considerate Contractors Scheme, achieving the score of 38 out of a possible 40 on the second audit; four local schools are working with the project team to gather contents for a time capsule which will be buried in the foyer of the building in the spring. The capsule will be unearthed in 50 years time; engagement with local community groups, for example the Colwyn Bay Lions Club; and sponsorship of a mini rugby tournament. The Assembly Government is also piloting community benefits clauses in the first services contract, with clauses included in the facilities management contract currently out to tender. 24

27 Supporting Sustainable Businesses Public sector procurers have already committed, through the Opening Doors Charter, that they will use sustainable procurement principles in developing procurement policy and reflecting it in supplier selection can deliver significant economic, social and environmental benefits. A good example of how this might work in practice is highlighted by the suppliers to the Welsh Assembly Government led Supported Factories and Businesses Framework (SFBF). Value Wales was chosen as a finalist by a prestigious UK award panel last year for its work on sustainability and social procurement Engaging with the supported businesses and enabling disabled people to fully contribute to the economy and actively participate in the social life of their communities is entirely consistent with the public sector ethos that spending public money should maximise the benefits of this expenditure by achieving value for money in ways that benefit society in the broadest sense. Examples of suppliers on the Framework and the benefits they have brought include: Economic benefits - Monwel Signs and Services, an Ebbw Vale based signage supplier to the SFB Framework, won a mini competition to supply and install signage for the new Assembly Government Aberystwyth office. A comparison concluded that Monwel were able to supply and install more signs at a lower cost than those supplied by a private sector supplier for the Assembly Government s Merthyr office. Monwel currently employs some 29 people all of whom are disabled. The work undertaken for the Assembly Government demonstrated that Monwel s operational basis did not compromise their ability to deliver on both cost and quality. Social benefits - Established in 2006, E-Inclusion Recycling C.I.C. is a Computer Refurbishment and Recycling Community Interest Company, 70% of whose workforce is disabled. As a supplier to the Supported Factories and Business Framework they provide licensed Information Technology Collection and Disposal Services through the SFB Framework and undertake Digital and Social Inclusion Programmes specifically designed to change people s lives and enact positive change in the most deprived communities in Wales. For many reasons, certain individuals suffer from low self esteem, low self worth, low confidence and low self respect which results in them being alienated or disenfranchised within society. Social exclusion can happen when individuals suffer from a combination of linked problems such as unemployment, poor skills, low incomes, poor housing, high crime, bad health and family breakdown. Any one of these factors can severely affect someone s life, dramatically. E-Inclusion use their experience and expertise to help individuals in their ICT service exchange programme - the Associates Programme. It develops an individual s confidence and skills to help them build a firm foundation for their life and improve their employability using Information Technology. The E-Inclusion Community ICT Programme works with deprived communities based around the principle of Community Reciprocal Giving i.e. opportunities provided by the community used to create opportunities for the community. The programme focuses on helping individuals to work together to change their communities. During 2009 e-inclusion provided the following: Under the E-Inclusion Free Computer Programme - 53 computers were given to disadvantaged individuals with a 12 month warranty; Under the Community Organisation Free Computer Programme and Free Engineering Services - 65 computers were donated to community organisations and schools all with a 12 month warranty; 25

28 Under the Community ICT Programme for the Elderly and Disabled - 65 elderly and disabled individuals received a free computer and training in their home all with a 12 month warranty; Under the Employability Programme - 10 unemployed individuals joined the employability programme using the used computers as a vehicle to build confidence and self esteem and learn I.T. skills required by employers; Under the Social Entrepreneur Training - Assistance was provided to 4 organisations who want to repeat the E-Inclusion Model across Wales. Environmental benefits - In 2009 E-Inclusion collected 38,123 kilos of IT waste, including cables, printers, keyboards etc. 26,200 kilos were recycled at Sims Group and the remainder, which consisted of good base units and computers, were subsequently reused and sold to the public and trade in Wales. Waste to landfill was negligible. Over 30,500 items, with a gross weight of over 46,900 kg, were collected by Remploy. Processing methods ensure that 98% of the machine components are recycled, with the remaining 2% of materials being ground into a very fine dust minimising landfill impacts. Corporate Social Responsibility and Legislative Compliance - It is important that IT recycling is safe, secure and sustainable. Did you know that: Reusing a computer is 20 times more effective at saving life cycle energy use than recycling; Only a third of waste covered by the WEEE Directive is actually being treated accordingly. Both e-inclusion and Remploy specialise in the refurbishment for re-use of IT kit and offer fully compliant data destruction to standards that meet the UK HM Government Infosec Standard No 5 which also exceeds the US Federal Government standards. Procurement - Assessing Sustainability The Sustainable Procurement Assessment Framework (SPAF) was initially developed by Forum For the Future and Value Wales predecessor, the Welsh Initiative for Procurement Partnerships and launched in In 2006 the framework was revised to incorporate the recommendations of the UK Sustainable Procurement Task Force report Procuring the Future and set a goal for all Welsh pubic sector bodies to have achieved Level 3 by the end of Significant progress has been made across the public sectors. While Sustainable Development is the overarching aspiration, Sustainable Procurement is a key strategic tool in its realisation. in short using procurement to support wider social, economic and environmental objectives, in ways that offer real long-term benefits, is how the public sector should be spending taxpayers money. Anything less means that today s taxpayer and the future citizens are both being short-changed. The message is simple: this is worth doing, there are clear benefits, it can be done, it is not difficult, it will not cost more in the medium term and will show real dividends in the long term. - Sir Neville Simms - Chairman, UK Sustainable Procurement Taskforce

29 What is bought; how it is bought who it is bought from plus how suppliers are managed and monitored has a significant effect on the sustainability of outputs and outcomes generated by any organisations expenditure. Procurement does not work in isolation from the rest of the organisation but works with internal budget and stakeholders to deliver organisational strategies, policies, objectives and priorities and to decide on the what, how and who. Without a clear corporate commitment to be a sustainable organisation the risks of unsustainable development are hard to manage and the opportunities for more sustainable decision making and outcomes will not be realised in a consistent way. Procurement is a key element but this need for an organisational commitment is essential. This need is reflected in the way in which the SPAF should be implemented. A cross functional steering group representing the breadth of the organisation is a pre-requisite for success as actions flowing from the three sections of the SPAF may well be more appropriate for officers outside of procurement to take forward e.g. HR may need to be involved in training issues, the Economic Regeneration unit may need to lead on supplier engagement. This approach will ensure that when actions are prioritised their origins and overall organisational contribution will be understood, accepted and owned. The SPAF is based on a number of Sustainable Procurement priorities, such as reduced resource consumption, sound environmental management, community development and regeneration, equalities, and supplier development. For these sustainable procurement priorities to be delivered it is essential that public sector organisations first have a strong procurement function that manages people, suppliers and IT effectively. Once a strong procurement function has been established, sustainable development objectives can be integrated into all procurement activities. It helps baseline current sustainable procurement performance and development of an action plan to ensure continuous improvement over time. Completed SPAF s are returned to Value Wales where the results are aggregated to monitor the overall sustainable performance across the Welsh Public sector. This highlights areas requiring development so Value Wales can target resources to devise suitable training opportunities. Organisations signed up to the Programme also benefit from an annual review with the Value Wales Sustainable Procurement team to discuss progress, barriers and identify what Value Wales can do to help ongoing sustainability performance through procurement. To date the Sustainable Procurement Assessment Framework has been used by some 66 Welsh public sector organisations to help determine the extent to which they are currently considering sustainable procurement within their organisations and to produce action plans to move towards Level 3 of the tool by the end of The SPAF is a key tool in supporting Welsh Assembly Governments determination to make sustainable development the central organising principle on which Wales future development will be based as expressed in One Wales: One Planet - The Sustainable Development Annual Report 2008/09. There are already some excellent examples of how the SPAF process can be implemented in ways that pull together current good practice and breaks down departmental silos to deliver action plans that connect and support a whole range of agendas; aligning them with sustainable principles. Worthy of particular praise is the work that has been done by Mid and West Wales Fire and Rescue Service in securing top level organisational commitment and how this can be communicated across the organisation to raise awareness of the specific sustainability issues they face and how procurement 27

30 can facilitate and support individuals making procurement decisions. In local government the City and County of Swansea has lead the way having worked through three annual SPAF cycles with focused action plans that have secured senior management buy-in, the adoption of the Sustainability Risk Assessment in their contracting and the achievement of Level 3 on the framework maturity scale. On a sectoral basis the Higher Education sector has set the pace as the first sector with 100% engagement and focused action plans to move each institution towards the goal of achieving Level 3 on the SPAF maturity matrix by the end of Analysis of the aggregate performance across the public sector highlights areas/issues with aspects of the framework [See chart below] that Value Wales examine to see what support can be put in place to help improve performance in these areas. Level 5 Exemplar Level 4 Enhancing Level 3 Practicing Level 2 Embedding Target level 3 Notes - The SPAF rating system Level 0 = Not yet at Level 1 Level 1 = Foundation - key foundation stones are in place Level 2 = Embedding - foundations are being built upon and consistency is being ensured across the organisation Level 1 Foundation Level 0 not yet at level 1 Level 3 = Practising - organisations at Level 3 have established that sustainable procurement is built in to their processes and as such consideration of sustainability issues will represent business as usual Commitment to sustainable development (SD) SD Policy Communication and training on SD Performance Measurement & SD Monitoring Mainstreaming Processes Procurement structure and approach Section 1: Management Issues Policy, Strategy & Communication People Procurement Processes E-Business Collaboration / Leadership Ethical Procurement Equality & Diversity (E&D) Engaging Suppliers & Developing Supplier relationships Contract Monitoring, Measurements & Results Section 2: Procurement Issues High SD Risk Goods & Services (UK priorities) Energy management Use of Recycled materials Waste management Water management Building & Construction Transport Food Supplier performance and policies Section 3: Outcomes and results Level 4 = Enhancing - good practice is being further enhanced and sharing of this good practice and collaboration within and across sectors is a feature of the organisations operations Level 5 = Leading - organisations achieving level 5 will be pushing the boundaries and taking a lead in developing best practice 28

31 Skills and Capability Developing the Procurement Profession The Value Wales CIPS cohort was first established in 2006 with the overarching objective of increasing the number of qualified procurement practitioners across the Welsh public sector. The cohort has been developed as a flexible, intensive and fast track route to achieving MCIPS accreditation. To commence the cohort programme, potential numbers are established during January, February and March so that an accurate forecast can be provided. Students embarking on study at level four usually continue to complete the remainder of their levels under the cohort. The programme consists of four study days, a revision day and an exam. Benefits: The cohort provides a fast track route to becoming MCIPS qualified; Modules are delivered at flexible locations throughout Wales; Module delivery is by a local provider by a range of experienced lecturers; Modules are available to book separately to enable flexible learning. Since its launch four years ago forty modules (including two public sector modules) have been delivered under the programme. Approximately two hundred delegate training days have been provided across levels four, five and six and some of the students that embarked upon study under the early programme have achieved their full MCIPS accreditation. Modules already delivered include: Developing Contracts; Measuring Purchasing Performance; Purchasing Contexts; Effective Negotiation; Improving Supply Chain Management; Risk Management & Vulnerability; Management in the Purchasing Function; Machinery of Government; Leading & Influencing; Strategic Supply Chain Management; Supply Chain in Practice; Public Sector & Stakeholder Governance; Advanced Project Management; Legal Aspects. Results have been excellent. Eleven students have achieved their full MCIPS accreditation by studying the full programme or a selection of their remaining modules under the CIPS cohort since it commenced in Over 60 students have taken advantage of the flexibility of the programme securing a pass in many modules across various levels which are helping students on their way to becoming fully qualified. On Saturday 5th June more than 200 graduates received their MCIPS at the annual graduation ceremony in the magnificent setting of Birmingham s Symphony Hall.The ceremony was attended by some 1,000 people. Two of the Value Wales team received their award in recognition of their hard work in completing all the levels to become full CIPS Members. For more information on the courses available go to: introduction/index.htm MSc in Procurement Over the course of the MSc programme, twenty five students have studied their MSc in Procurement. A number of important research project dissertations were produced as part of the programme. This body of public sector knowledge forms a library of research which has been a valuable contribution to the work of Value Wales going forward. For more information go to: buy4wales.co.uk/prp/training/trainingopps11/ mscinstrategicprocurement/index.html 29

32 CIPS Cohort: A Student Perspective I selected the Value Wales CIPS cohort as my preferred route to achieving my MCIPS qualification as I knew I d get more from studying in a group environment than on my own. I wanted to benefit from studying with people from public sector backgrounds as we all experience the same issues, such as Public Procurement Regulations and EU Directives. I found the cohort s timetable was better suited to my lifestyle than the regular CIPS timetable. The study method is very motivating. From studying under the cohort I have developed assessment techniques and people-management skills which enable me to advise my colleagues on procurement issues. It gave me a broad view of procurement and the ways different organisations and sectors, for example the Welsh Assembly Government and the NHS, achieve their goals. It also allowed me to benchmark and discuss best practice with colleagues from various sectors. Qualifying has made me more confident in my abilities and enabled me to begin refreshing Finance Wales procurement policies and procedures. It s raised my profile within the company, as I ve developed my role into one that s more consultative. I have also found that the Value Wales networking events have enabled me to share skills and experience with other procurement professionals. I ve also made a few friends, which is an added bonus! I would most definitely recommend studying under the cohort. I ve learnt invaluable skills that are helping me advance my career and add value to my company. Sarah Patnett Business Services Manager, Finance Wales Plc Workforce Skills and Capability A new 11milion Welsh Assembly Government project aimed at raising procurement skills and capability across the public sector has been given the go-ahead. Backed with 5.7million from the EU s Convergence European Social Fund the 5 year Transforming Procurement through Home-Grown Talent project will tackle poor procurement head-on. Core to the project will be the creation of a cadre of trained and experienced officers - drawn from both new graduates and junior staff - who will become the procurement leaders of the future. Training will come on-the-job through work on exciting projects to deliver the 200million savings required by the Efficiency and Innovations Board. Further details will be available in due course. 30

33 Section 2: Asset Management and Construction Procurement in Construction 2009/10 was a year which saw Value Wales work plan on construction take shape following Cabinet approval in May 2009 of a procurement strategy for construction. It s opportune to reflect on the work that has been progressed and to outline some of the plans for this financial year. The construction section of the Procurement Route Planner (PRP) went live with some basic content in the summer of This will be the subject of further development over the course of 2010, to take account of the refresh and update of Achieving Excellence in Construction (AEC). The structure of the PRP is based on the Construction Quality Assurance Template (CQAT) which has been developed to incorporate the principles of the Office of Government Commerce Common Minimum Standards and the principles of the AEC initiative. The evidence captured from over 500 demonstration projects illustrates that adoption of AEC is a proven approach that leads to improved cost, time and quality project outcomes. The PRP and CQAT will help organisations further adopt the AEC principles. In the coming year, Value Wales will be working with colleagues to implement a system to report project performance to provide further evidence of the success of the AEC initiative. Further developments to the Investment Database, located on were implemented to improve the way in which data can be uploaded and how this information can then link to the creation of subsequent OJEU notices. Use of this facility is fundamental for future planning purposes: visibility and understanding of our collective plans for investment in construction projects will help identify how our requirements relate to future funding availability and how we can prioritise what it is that we need to deliver. As part of the Supplier Qualification Information (SQuID) project, public sector colleagues and the industry alike have provided some very helpful contributions and feedback. Development of a consistent approach to pre-qualification in construction will be a massive achievement and we will continue to work with colleagues to progress this work during 2010/11. The OGC Fair Payment Charter has also been promoted via the PRP as a best practice approach to ensuring supply chain partners receive payment in good time for work duly completed. The budget in March of this year announced that use of fair payment clauses were to be mandated for central and civil government. A Procurement Policy Note to this effect is expected shortly from OGC and Value Wales will be working with colleagues across the public sector and industry to establish how this can also be adopted in the Principality. 31

34 Cowbridge School The 21.5million redevelopment of Cowbridge School is part of the Vale of Glamorgan s School Investment Strategy. Due for handover in September 2010, the project is already delivering some very impressive benefits through the Council embracing modern approaches to procurement which focus on: attaining maximum value for money; delivering the project on time, to budget and agreed quality; and embedding sustainable procurement and operations. Having adopted the New Engineering Form of Contract, fundamental to the Council s approach to the construction of the school has been collaboration. Strong relationships have been built across the whole delivery team, including the consultants and main contractor. Community benefits are core to the objectives of the project and the actual construction process is being monitored on a number of levels to ensure continual improvement, including the use of preagreed KPIs. One of the KPIs has monitored the level of use of local labour within the project, a figure currently at 91% of the total labour engaged to date. This equates to orders placed with local South Wales subcontractors to the value of 8.3million out of a total spend of 8.8million, an excellent outcome which has helped the local economy during difficult times. The contractor is also looking at the re-use of recycled aggregate and working with Waste Resource Action Plan (WRAP), has been able to target over 15% of recycled materials within the new build as well as engaging in the responsible sourcing of materials. As part of Constructing Excellence Wales demonstration programme the Council s project team will continue to work collaboratively to secure further benefits and the project provides further evidence that the Egan and Latham principles support the delivery of best value through our investment in construction. 32

35 State of the Estate The Welsh Assembly Government s Estates and Projects Division has produced comprehensive annual report highlighting how efficiency and sustainability is being built into the operation of it s Administrative Estate. The State of the Estate report 2009/10, effectively baselines the performance of the estate as at 31 March 2009 and the report will now be produced on an annual basis. The report formally records and captures the efficiency and sustainability performance of the estate as of 1 March each year and will track the improvements being made across the estate against a number of benchmarking criteria and highlight areas where further efficiencies can be made. All this work is also linked closely to Office of Government Commerce s (OGC) High Performing Property Strategy (HPPS) principles and UK Government s Operational Efficiency Programme. Information which feeds into this and future reports is captured on e-pims (Electronic Information Mapping Service), which is the database that we are developing and sharing with the wider public sector as part of the National Asset Management workstream of the Efficiency & Innovation Partnership. State of the Estate demonstrates how we are successfully managing the Administrative Estate and the good quality data that is being gathered, in order to realise continued performance improvements. Headline facts: Total occupancy costs fell between 31 March 2008 and 31 March 2009 by 5.5%. The proportion of vacant space is very low (3.46%) and the identified flexibility of the estate has resulted in any vacant space being for limited periods only. Our average costs per full time employee have improved over the 12 month period ending 31 March 2009 standing at 3,174, and is 30% lower than the UK public sector estate (OGC figures). The average occupier costs at per sq m across the estate fell by 5.2% over the reporting period. CO 2 emissions were reduced by 5.4% over the 12 month period ending 31 March 2009 by 5.4%. 361 tonnes of CO 2 saved through the Carbon Management Programme. Display Energy assessments were completed and Certificates displayed in foyers of all WAG offices over 1,000m 2. Bridget Hardy, OGC s Head of High Performing Property Strategy & Implementation Department, has commented that she was very impressed with the report and the fact we recognised that data transparency is becoming important, not just as a requirement to demonstrate performance to the public, but also as part of good management. For copies of the report and further information please richard.baker@wales.gsi.gov.uk. 33

36 Section 3: Investing in public service improvement The Welsh Assembly Government has supported public sector improvements through various means including investment support for change projects. Value Wales has led on the development and delivery of two such investment schemes: the Making the Connections Improvement Fund and the Invest-to-Save Fund. Details about both of these initiatives is set out below. Making the Connections: Improvement Fund The Fund has since 2006, supported joint working projects across Wales that improve public services and stimulate significant change from better ways of working and innovation. During its 3-year availability, the Fund has supported projects that deliver greater efficiency; improved citizen engagement arrangements and customer services; and those which have supported the One Wales goals of creating citizen-centred services that lead to substantial public service improvements. These have included proposals from local government, the NHS, third sector, the emergency services and education. Supported projects have generated considerable knowhow and best practice and some examples of this are showcased here. Whilst existing live projects will continue to receive support until they are concluded the Fund has now closed to new applications. Other potential funding opportunities for improvement projects are the Invest-to-Save Fund (see page 37) and the European Social Fund (ESF) Convergence Programme. South West Wales: Local Authority Shared Legal Services This case study concerns the development of collaborative working arrangements to deliver virtual Shared Legal Services by Bridgend CBC, Ceredigion CC, Carmarthenshire CC, Neath Port Talbot CBC, Pembrokeshire CC and the City & County of Swansea. In its first phase, Swansea University had, with support from the Assembly Government s Making the Connections (MtC) Improvement Fund, undertaken a feasibility study looking into the scope and opportunities for public sector shared legal services. A subsequent review of this study by the Heads of Legal Services from the 6 participating local authorities identified opportunities for increased service efficiency and economies of scale across the region. An MtC Improvement Fund grant was subsequently provided to support Phase 2 of the project. The outcome of this Phase 2 was to recommend the form that Shared Legal Service should take in the region and what initiatives were required to ensure that a quality service could be maintained across the participating authorities in the short and medium-term against a background of increasing costs and diminishing budgets. The WLGA Regional Partnership Forum for South West Wales has overseen the progress of the virtual shared service, with a particular focus on staff engagement and a commitment to project management resource supported by project assurance principles to maintain momentum. Some of the approaches adopted and resulting benefits of the work undertaken include: a minimum cash saving of 40,000 on legal library costs in 2010/11 (> 100,000 over 3 years); 34

37 scope identified to secure significant cash efficiency savings ( 170k to 280K annually) on external Solicitors and Barristers fees through joint procurement; a skills matrix prepared for each authority; the production of a Shared Legal Services Business Plan; detailed analysis of work by work type for 2008/09; detailed analysis of external legal costs by work type for 2008/09; draft business requirements for a single case management system; 12 special interest groups established; shared Legal services web forums set-up and rolled out. In going forward the future agreed approach will be to: enter into a formal agreement with regard to the development of a virtual shared legal services. The new shared service will see closer collaboration between staff in the legal teams across all six authorities with greater sharing of resources and internal expertise; maintain a robust and effective in-house legal service as cost of gaining external advice is 3 to 4 times the cost of procuring the same advice internally; up-skill the existing service to reduce the need to go externally for advice; create cost savings through the economies of scale provided by procuring services regionally; and create a sustainable stream of income by providing legal services to other 3rd party public bodies. The Phase 2 analysis conducted by the 6 local authorities has highlighted the need for the following future actions. Organisation - The development of a regional workforce plan that supports the long term sustainability of a quality workforce that meets the future needs of the authorities. This will inform succession planning, alignment of terms & conditions, recruitment plans, development of specialist teams and training and development plans. IT Infrastructure - The need to move to a single case management platform from the 4 systems operated currently. The approach will deliver savings in terms of systems maintenance costs but also in the development of workflows. Training & Development - To ensure training is relevant and appropriate and to provide training more cost effectively across the region through greater coordination between authorities and the provision of locally based training courses. Joint Procurement - To deliver budgetary savings in external legal fees and legal library provision. Joint procurement will enable all authorities to get the benefit of increased buying power. Best Practice - To review end-to-end processes with client departments to create efficiencies that reduce the number of legal hours required, whilst improving end user experience and managing the risk to the authority. External Income Streams - To create a sustainable income stream, whilst maintaining the quality of work provided to internal and external clients. 35

38 Llandrindod Wells: Joint Emergency Services and Her Majesty s Courts Service Project This case study concerns the development of collaborative working arrangements between Mid & West Wales Fire & Rescue Service, Dyfed-Powys Police and Her Majesty s Courts Service to deliver a fire station, police station and magistrate s court at Llandrindod Wells, Powys. The town s 50-year-old fire station and Victorian police station with integral court room had reached the point where they were not able to meet the requirements for modern day services to citizens. In the circumstances, it was decided that 21st Century services could best be delivered through the provision of new purpose-built facilities at a new site in the town and that a joint-working arrangement between the parties would ensure that the facilities were provided and maintained in the most efficient and effective way possible. The collaborative approach underway will make the best future use of the public estate and offers benefits through a shared approach to construction. It will deliver a vision of sharing more, reducing carbon emissions and waste whilst improving resource efficiency and reducing running costs through joint occupancy and sharing of some key facilities. Some of the approaches adopted and resulting benefits to date include: i) the establishment of a tripartite Project Board by the partners, which has resulted in the pooling of skills and bringing an extensive and diverse knowledge to the benefit of the project; the adoption of Prince II type project management arrangements which support effective and efficient project delivery; ii) the establishment of a tripartite Executive Board to oversee and authorise the Project Board and to link back with each services executive board, thus ensuring a smooth and efficient approach to decision making; use of Carmarthenshire County Council s frameworks to deliver design consultancy and a main contractor utilising an NEC form of contract that encourages partnership working and thus ensuring transparency to stakeholders, reducing risk, reducing the cost of procurement and preventing programme slippage during the procurement phase; iii) opportunities maximised for small and medium sized local businesses (SMEs). Of the 5million being spent, 2million has been placed with local businesses. For example, John Weaver Construction of Swansea engaged in a very successful Meet the Buyer event at Llandrindod. This event, supported by the Welsh Assembly Government and Menter a Busnes, allowed local SMEs to meet and engage with the project s main contractor. Many contractors have already benefited from attending the Meet the Buyer event as 1million worth of contract s were placed; iv) sustainability being at the heart of the project with innovative design solutions such as locally sourced larch cladding, rainwater harvesting and a green roof; v) diligent recording of the project s development which will inform a lessons learned report. The report will detail experiences and lessons learned to encourage and guide similar collaborative project opportunities. Key to taking the project forward has been the development of a Partnering Agreement that sets out a shared understanding of policy and procedure for the delivery of the innovative project. The development of the partnering agreement and associated project documentation has been supported by the Welsh Assembly Government s Making the Connections Fund. It is expected that this documentation and lessons learned report will be used as a starting point for other similar collaborative projects in the future. All being well the construction phase of the project is programmed to commence in June 2010, with an anticipated completion date of September

39 Invest-to-Save Fund In May 2009, the Assembly Government announced a new investment fund to help public service providers respond to the challenge of delivering quality services and outcomes for citizens during a period of tightening budgets. The Invest-to-Save Fund specifically helps bodies to introduce improvements that deliver significant efficiency savings whilst ensuring effective citizencentred services. So far, there have been two rounds of the Invest-to- Save Fund and over 26million has been invested in 38 projects. Examples of projects being supported are listed below: Round I invested 11.2million in 23 projects including: - Flintshire County Council s Agile Working project that will use I.T. to support flexible working practices to deliver improvements in efficiency and effectiveness; - Wrexham County Council s project to reduce energy costs and carbon emissions; - Integrating services for students & visitors at University Wales Institute, Cardiff thereby providing an efficient/ effective one-stop-shop; - Neath Port Talbot CBC s fostering spendto-save strategy and Lean Systems Review of children and young peoples assessment and case management services. Round II invested 15million in 15 projects including: - Accelerating the benefits of the Public Sector Broadband Aggregation initiative by assisting public sector connections to the network and providing access to services at a reduced cost - typically a reduction of around 20% in revenue costs; - Bridgend CBC s Critical Alarm Monitoring project - a new approach to the monitoring and management of the authority s fire and intruder alarm systems - releasing cost savings of 166,000 annually and improving communications and link technologies; - South Wales Fire and Rescue Service s alternative crewing system at selected South Wales stations that will maintain existing response times and levels of service - generating net efficiency savings of 2.3million during its first 4 years of introduction and then 1.6million per annum thereafter; - Cardiff and Vale University Health Board s new way of working for community based staff, specifically District Nurses and Health Visitors, using mobile technology solutions (Note Book Devices etc). Benefits in patient care in terms of safety, responsiveness and improving efficiency (expected to be a minimum of 15% real terms increase in direct patient care). As a key enabler, action has been taken to align the Invest-to-Save Fund with the priorities of the new Efficiency and Innovation Board, which was established in 2010 and is chaired by the Minister for Business and Budget. Further information about the Invest-to-Save Fund, including details of projects being supported and future funding opportunities, can be found at: bettervfm/efficiency/i2savefund/?lang=en. 37

40 Section 4: Looking Forward Meeting the Challenge of Change This report mostly looks back at what has been happening during the last year and showcases projects that are already starting to make improvements to the way public services are delivered in Wales. This section of the report looks forward and outlines some of the recent action that has been taken by the public sector to accelerate the pace of change and deliver further improvements and benefits in the future. The First Minister, Carwyn Jones, has said that the challenges facing the public service in Wales are one of his key priorities. In February he brought together all the leaders of the public services in Wales for the first of a series of Public Service Summits to develop a Team Wales approach to Meeting the Challenge of Change. The First Minister has made it clear that he wants a collaborative approach to developing an efficient and innovative public service for the future and that leaders should focus on: - prioritising actions and services which concentrate on improved outcomes; - innovation in the design and delivery of services; - regional or national collaboration; - transforming efficiency within every organisation; and - engaging the workforce and releasing the energy of front-line staff. The Efficiency and Innovation Programme and Board The Board and Programme was established in 2010 to help tackle the challenges that can best be overcome through collaborative working. Chaired by the Minister of Business and Budget, it is made up of Chief Executives from across public services, the Wales TUC and the Wales Council for Voluntary Action. The focus is on practical leadership and action to: achieve significant cash-releasing and costreducing improvements in operational efficiency; promote innovation and engagement by citizens, in the design and delivery of services; and maximise benefits for the economy, environment and people of Wales through service design and delivery. The Board has already agreed to: secure 200million savings through collaborative procurement and commissioning by 2013; save money and improve services through securing better value for money from the 10billion public estate; establish innovative and more efficient ways of working through a Wales Public Services ICT strategy; develop a more flexible and collaborative approach to deploying staff across public services through an all- Wales Career Transition and Support Unit; and transform the way organisations manage their business and develop new innovative models of service delivery. 38

41 We are living through times of exceptional challenge to our key public services - the challenge of change. Change is vital to deliver the public services the people of Wales deserve, and meeting that challenge requires exceptional leadership and commitment. - Carwyn Jones, First Minister of Wales There are no simple answers, but we have to do better. We have to accelerate change. We are beginning to see just what we can achieve if we start with the needs of the citizen. Efficient services across the public sector are nearly always better services. - Jane Hutt, Minister for Business and Budget The Collaborative Procurement and Commissioning Board Mohammed Mehmet, CEO Denbighshire Council, Chair, Collaborative Procurement and Commissioning Board said: I am delighted to be chairing the new Efficiency & Innovation Procurement Board and to be joined by representatives from across the public sector in driving forward an exciting programme of change. The Board has quickly established itself and has already agreed to secure 200million of savings through collaborative procurement and commissioning by This will be achieved through working more intelligently with the supply base, using more efficient processes, including a reduction in duplication; and securing excellent supplier performance. We must and will also use procurement to drive social, economic and environmental benefits. Three priorities have been identified by the Board: i) a National Sourcing Strategy; ii) xchangewales; and iii) a Category and Capability Review to identify opportunities to deliver additional benefits. The Board has also commissioned a Procurement Taskforce to carry out the Category and Capability Review and to recommend priority ideas and concepts for the Procurement Board to consider. The Board is also setting up a Supplier Reference Panel to include senior representatives from FSB Wales, CBI Wales, the Wales Council for Voluntary Action, the Social Enterprise Coalition and key industry sectors such as construction. The purpose of this panel is to help suppliers and public buyers improve engagement; shape policies to foster economic renewal and identify and address supply voids. 39

42 The Procurement Taskforce Alison Standfast, Deputy Director, Value Wales, Chair, Procurement Taskforce said: The work undertaken over the last year puts Value Wales in a great position to help drive the Efficiency and Innovation agenda forward. Having the support of senior leaders and the chairmanship of Mohammed Mehmet is already helping the public sector to move at more pace, and as a public sector we have a real opportunity over the coming year to transform procurement in Wales. The Procurement Taskforce, which I have drawn together, has been established to support the work of the Procurement Board. The Taskforce is reviewing public sector procurement experience to date, analysing data, and gathering evidence from stakeholders. Taskforce members, who are drawn from across the public service in Wales, are contributing their own considerable personal professional expertise to help take matters forward. The forward work programme includes: - reviewing the current National Sourcing Strategy and identifying missed opportunities for various forms of collaboration; - reviewing improvement initiatives underway in the commissioning and procurement of Social Care, Construction, Housing, Waste, and Education; - identifying up to 5 potential high-profile projects where a different approach to procurement would drive an improvement in core public services; - reviewing the current procurement and commissioning capability in Wales and considering ways to address gaps; - working with the NHS shared services project (and Invest-to-Save project) and local government s Welsh Purchasing Consortium and North Wales Purchasing Partnership consortia to identify opportunities to strengthen procurement capability across Wales; and - considering how the xchangewales tools and processes can become business as usual. The results of this work will help to shape Welsh public procurement of the future. 40