Car Parks Cash Collection Service

1.1 The Council currently engages a contractor to collect, count and bank the cash which is collected from car parking charges. In total £1.9m is collected annually (with the majority of this being in the summer) and as one might expect it is all in the form of coinage.

1.2 With the knowledge that the existing contact was due to expire on 17 July 2002, Car Parks Administration began the re-tendering process in the summer of 2001, placing advertisements in the Official Journal of the European Community (OJEC), the local media and an appropriate national publication. In order to start the contract before the peak season, any new arrangements were to operate with effect from 1 April 2002, and the existing contractor agreed to a reduction of the existing arrangements until 31 March 2002.

2.1 There were nine companies which expressed an interest in the contract, of which seven completed and returned the Council’s routine evaluation questionnaire. Following evaluation, using pre-determined selection criteria, three companies were rejected because they did not meet the Council’s requirements in respect of health and safety and financial stability. This left four companies (which did not include the existing service provider) who were invited to submit tenders in line with the Council’s specified requirements.

2.2 The response to this initial tendering exercise was disappointing in that the Council received only one tender (for £68,772) and that it was significantly greater (£21,000) than either the existing cost or budget provision (£48,500). Being concerned that the Council had received little competition and also conscious that the budget provision was under severe pressure, officers from both car parking and internal audit began to consider what alternative arrangements might be made.

2.3 After receiving advice from the Legal Services Manager, officers decided that the Council should enter into negotiation with the one company that had submitted a tender and those which had initially expressed an interest and which had met the Council’s short-listing criteria. Two companies (which included the one which had already tendered) agreed to enter into negotiations and to make proposals to the Council as to how best they believed the service should/could be provided. Both companies submitted revised bids using the normal tendering procedure as follows :

	£
Company A (revised tender)	62,015
Company B	93,000	(including cross Solent charges)

Although some improvement had been achieved, there was clearly a budgetary problem remaining.

2.4 Officers were also developing alternative arrangements in the form of a possible in-house service, staffed by direct employees. This was done to give the Council (a) a benchmark against which to measure the cost effectiveness of bids and (b) a real alternative to using a contractor. Again, with advice from the Legal Services Manager, officers negotiated with the existing contractor to extend existing arrangements until 30 September 2002, in order to allow more time to fully consider all options.

2.5 Clearly, there are several considerations involved in establishing an in-house operation :

(i) Developing a potential budget for an in-house operation (staff, vehicle running costs, insurance). This included advice from Personnel Services on the likely remuneration of new staff by way of a job evaluation.

(ii) Asking the Council’s Health and Safety consultant to carry out a risk assessment of any proposed operation.

(iii) Seeking confirmation of any additional insurance costs that would be incurred.

(iv) Seeking quotations for the purchase/lease of a suitable vehicle and the necessary adaptations that would be required.

(v) Making sure that any proposals are sufficiently robust in terms of cover arrangements.

(vii) Sourcing suitable accommodation from which any new staff might operate (mainly in terms of cash counting).

All but the last of these (accommodation) have been dealt with and resolved. It is hoped that, as part of the proposed moves in the latest accommodation review, the associated needs of any additional car parking staff could be accommodated.

2.6 The results of developing a proposal for an in-house operation are contained in the confidential appendix.

These are set out in detail in the report. Accepting the lowest bid from a contractor will require £14,000 extra budget provision. Developing an in-house service will lead to significant savings.

There are no significant legal implications although it is believed that TUPE Regulations will apply to staff who work for the existing contractor who might transfer to the Council’s employment.

The Council accepts the lowest negotiated tender that it has received of £62,015.

The Council approves the creation of an in-house operation at a lower cost of £44,000 pa and approves the acquisition of a suitable vehicle at an estimated cost of £28,000 (including adaptations - the leasing costs of which are included in the proposed revenue budget at paragraph 2.6), and to incur some minimal costs of adaptation to an existing building.