Agenda item

To consider a report by Audit Wales (copy attached) from the Head of Corporate Support Service: Performance, Digital and Assets on Denbighshire Commissiong Services.

The Lead Member for Corporate Strategy, Policy and Equalities introduced the report to members (previously circulated).

 

The report summarised the Audit Wales Report of Arrangements for Commissioning Services in Denbighshire County Council (DCC) and provided Officers’ responses to the recommendations for improvements.

 

In July to August 2024, Audit Wales undertook a review of Denbighshire County Council’s arrangements for commissioning services, specifically the extent to which this had been developed in accordance with the sustainable development principle; and that it would help to secure value for money in the use of the Council’s resources. The full report was included in Appendix 1 (previously circulated).

 

Audit Wales were undertaking this work at each of the 22 principal Councils in Wales and, as well as reporting locally to each council, also intended to produce a national report.

 

Commissioning was the process by which the Council designed services it intended to deliver. It began with defining the services and the desired outputs and outcomes and ended when the Council organises its method of delivery. For example, by establishing a delivery team internally, or through procuring an external supplier. The Audit did not cover procurement arrangements or the Council’s contract management arrangements.

 

The final DCC report was issued in December 2024 and reached the overall conclusion that the Council had set out clear expectations of departments when commissioning services, but the Council did not have arrangements in place to ensure that these were consistently met.

 

The report made two recommendations for improvement. Appendix 2 (previously circulated) provided the management response to Audit Wales’s recommendations for improvement.

 

The Head of Corporate Support Services: People provided further details on the report.

 

The report focused specifically on one question, which was does the Council put in place proper arrangements to secure value for money in the use of its resources. The process begins with looking at what services the Council delivers, what they want to achieve by looking at outputs and concludes with looking at how the Council is going to deliver those services.

 

The process was very important to ensure that services were delivered economically, effectively and efficiently. It was the foundation of the rest of the process which included procurement and contract management arrangements.

 

The conclusion of the Audit Wales report as stated above was that the Council had set out clear expectations of departments when commissioning services, but the Council did not have arrangements in place to ensure that these were consistently met. The rationale for the Audit Wales decision could be found in the report and was summarised as the Council could demonstrate a clear rationale for commissioning services and was included within the Council’s Procurement and Commissioning Strategy. The processes and the Commissioning form prompted departments to consider their rationale for commissioning services for what they required and how.

 

Arrangements were also in place for conducting options appraisals to inform commissioning activity. However, as a Council the arrangements were not in place to systematically prompt departments to begin considering commissioning options at the appropriate time. Departments’ engagement with commissioning workflows was driven by them rather than being scheduled corporately.

 

The report concluded that the Council did consider the short, medium and long term factors that may influence commission timescales and this should be built into the process. The Head of Corporate Support Services People provided an in-depth explanation of the conclusion of the report.

 

Audit Wales had made two recommendations to the Council:

·       The strengthening of the strategic oversight of commissioning activity

·       To develop the formal arrangements for sharing lessons learnt

The report contained the Management Response to the recommendations above which included Head of Service working with their Procurement and Finance Partners to provide an overview of commissioning activities over the next 24 months, and Insight, Strategy and Delivery Manager building into the prompt sheet used and issued to Heads of Service for development of their service plans each year considering any likely commissioning activity as part of development of Service Plans.

 

The Chair thanked the Lead Member and Head of Corporate Support Services: People for the report and welcomed questions from the Committee.

Members questioned the culture within the Council towards commissioning services outside of the Council and felt that it needed addressing as in some cases there was no other option but to use external resources. The Monitoring Officer stated that the report related to the processes of how the Council Commissioned services, and many services that were commissioned did not require approval by members and were subject to delegated responsibilities unless they were over a certain threshold.

Members commented that the report was positive and reassuring.

Members questioned the appetite for outsourcing services and lessons learnt and questioned whether there was the need to use SWOT analysis on each resource to allow members to see why and how they had been chosen. The Collaborative Procurement & Framework Manager explained that there was two pieces of legislation used, the Procurement Act and the Wales Social Partnership and Public Procurement Act that both compelled the public sector to consider barriers to SME’s and third sector organisations. Discussions had been held with Denbighshire’s Voluntary Services to demonstrate that barriers were being reduced to enable external organisations to bid for work and to become more financially sustainable.

The Chair informed the Committee that if members wanted to know more about the legislation mentioned above, a training session was held in January 2025 on procurement and the documents from the session were on the Members Training Drive.

Members sought clarity on the Audit Wales level questions used in appendix 1 to the report. It stated level 2 and level 3 questions were used however there were no level 1 questions. The Audit Wales representative stated that the level 1 question was the overall question and level 2 and level 3 questions were used to break down the overall question further.

Members questioned if organisations were in place to deliver services, stating that sourcing externally could be difficult due to competition within the market. The Collaborative Procurement & Framework Manager explained that market development was very important. The new Acts in place gave Local Authorities the powers to publish a pipeline of what could potentially be sourced in the future. This allowed for formal engagement with the private sector and forward planning of procurements and would also allow for dates to be provided of when contracts were coming to an end.

Members questioned how the Council were communicating with the private sector. The Lead Member for Corporate Strategy, Policy and Equalities welcomed the question and stated the importance of engaging with the private sector. There had been lots of engagement with Business Wales and public engagement sessions had been held. The Collaborative Procurement & Framework Manager added that she had attended many events with Business Wales and North Wales Construction. There had been a Meet the Buyer Event which was greatly attended by over 80 local businesses.

The Chair referred to the report stating that the Council did not have arrangements in place to systematically prompt departments to begin considering commission options at an appropriate time and questioned if there was any prompting activity in place at all. The Head of Corporate Support Services: Performance, Digital and Assets stated that there was no corporate prompt yet within the Council and the recommendation from Audit Wales regarding this was wholly welcomed and accepted.

Following an in-depth discussion, the Committee:

RESOLVED: that the Audit Wales – Denbighshire Commissioning Services report be received and noted.