To provide the Strategic Monitoring Committee with a further update on the status of the Herefordshire Strategic Service Delivery Partnership between the Council, Amey Wye Valley Limited and Owen Williams Limited. 

Further to its meeting on 25th October, the Committee received a further update on the status of the Herefordshire Strategic Service Delivery Partnership between the Council, Amey Wye Valley Limited (AWV) and Owen Williams Limited.

In accordance with the Committee’s decision of 25th October the report set out the transitional arrangements relating to the purchase of the major part of Herefordshire Jarvis Services (HLS) by Amey plc; the continuity of service delivery – stating that there had been full service continuity with no interruption to services of any kind; Amey’s assessment of the programme of works for the reminder of 2007/08 and a baseline on the standards of service provision against which future performance could be assessed.

The Chairman welcomed Mr N Sharman (Head of Local Government Services, Amey plc); Mr S Gyford General Manager Amey Wye Valley Limited and Mr R Garbutt (Manager Owen Williams Ltd, Hereford Office who had been invited to make a presentation and answer questions.

Mr Sharman introduced the presentation.  This outlined the background to the standing of Amey plc and the resources available to the Company.  It explained Amey’s aim, specialisms and understanding of the requirements of its customers; listed successful local government partnerships it was already involved in, and noted similarities in particular with Hertfordshire County Council which also served dispersed communities.  It described Amey’s values, which were considered to align with the Council’s.   It emphasised in terms of performance that the aim was to make profit through smarter and better working, sharing the benefits with the Council. The services provided by Owen Williams and AWV contracting under the contracts with the Council were described.  It also noted the new vehicles, new plant and new personal protective equipment provided since AWV had taken over the contract with the Council; and outlined steps taken during the integration period.

Mr Gyford identified the following differences in approach: suppliers paid on time; Amey’s understanding of the needs of its Local Government customers; AWV felt valued by its colleagues (not just a source of cash); tangible support was received from the Group in all areas of the business; monthly contract reviews were supportive as well as challenging; plant and equipment were new; and there were real opportunities for growth.

He reported that the “Bellwin” flood remedial works could be delivered by the deadline of 22 December 2007.  He added that 75% of the programmed highway works 2007/08 had been completed which meant that progress was on track.

The presentation also commented on whether there was a potential conflict of interest created by the fact that Owen Williams as consultants and AWW as contractor were both owned by Amey PLC.  It was asserted that it was now commonplace for Councils to procure their consultancy support and contracting delivery as an integrated service from a single supplier.  To abuse the position would be contrary to Owen Williams’s values.  Apart from any question of morality, the reputational risks to Amey of any bad practice would be immense, not only in Herefordshire but in all its current and potential public sector contracts.  The Council and its external auditors had the ability to audit any of the work on an open book basis.

In the course of discussion the following principal points were made:

·         The action taken to pay creditors to whom money was overdue was welcomed.

·         The hope was expressed that there would be cost savings as a result of closer working with Owen Williams as they were now part of the same Company group as AWV.

·         It was suggested that it should be recorded that on transition it would be more accurate to say that there had been minimal disruption to services rather than that there had been none.

·         It was stated that Members had experienced difficulties in getting matters dealt with by the previous contractor and it was to be hoped that this would no longer be an issue.  In reply it was acknowledged that there had been mistakes in the past.  The intention was to own up to mistakes, learn from them and deliver jobs on time communicating the right information and providing careful management. 

·         Mr Sharman paid tribute to the staff who had transferred to AWV saying that the Company had seconded mangers to help and support existing staff but not to replace them. 

·         AWV was looking to engage the public more closely working with councillors and officers, being accountable for priorities at a local level and delivering a good service.  A wide range of design skills and other resources were being provided by the Amey Group.   There was also an eye to supporting the work on the regeneration of Hereford.

·         It was requested that there should be early engagement with Parish Councils and the firm should make sure that it did what it said it would do and kept people informed.  In reply it was said that the need to engage at local level was recognised and the example given of how this was done in Bedfordshire, with Amey staff operating alongside Council officers.

·         It was asked what scope there was for AWV to gain external work, noting the difficulties experienced by HJS in doing so.  In reply it was said that the financial position was now sound, enabling AWV to get better prices from suppliers and reduce its own tenders for works.  Plans for growth, which would not impact on work under the contract with the Council, had not been finalised yet.  It was thought that the most profitable area for expansion would be in highways and civil engineering in the areas surrounding the County to keep costs down and enable projects to be effectively supervised.  There were no plans to look much further afield except in support of the Amey Group.  It was confirmed that because of the sound credit rating prospective clients could have confidence in AWV that they had not had in HJS.

·         The ongoing closure of Colwall bridge and the time taken to carry out analysis of the structure and identify a solution was raised, noting also a failure of communication with the public.  It was replied that the advice was that the bridge was of particularly complex construction necessitating time-consuming analysis.  It had taken 8 weeks to get agreement from Network Rail (compared with the usual 16) to get permission to gain access to the railway line.  It was still expected that it would take until December to complete the assessment.  This had to be undertaken by one person (although he was supported by a team that included rail specialists brought in from York and Birmingham).  It was acknowledged that communication in explaining this point had been poor.  It was added that as part of the process consideration had been given to the option of constructing a Bailey Bridge.

·         It was asked if there had been a risk assessment of the economic impact on communities across the County of the possible loss of bridges.  It was stated that this work was ongoing as part of the Asset Management Plan prioritising and costing works – noting that there were some 887 bridges in the County.

·         It was asked whether the new arrangements would lead to improved working relations with the Highways Agency.  AWV said that whilst nothing could be done directly with the Highways Agency there was influence with the contractors on the A49 who were drawn from the Amey Group.

·         A question was asked about a programme of quarterly visits by routine/reactive gangs to parishes that had been piloted.  It was confirmed that this had begun in the Southern Division, extended to the Central Division and was to be rolled out to the Northern Division in December.  It was requested that Ward Members were notified.

·         It was asked how the debt of £3.55 million owing from HJS to its parent company and assigned to Amey as part of the transfer transaction would be treated and in particular if the burden would be borne by Herefordshire Council as client.  It was replied that the set rates charged for works under the contract were independent of the level of debt.  The debt would have to be cleared over time.  AWV could approach this task with some enthusiasm given the overall change in working circumstances.

·         Problems with the condition of paving in High Town, Hereford were raised.  It was noted that this was an example of an issue where Members, acting on their own account and in response to complaints from constituents, had had to constantly press for a resolution over some time.  It was stated in reply that considerable effort had been invested into finding a solution and Owen Williams and AWV were considering how improvements could be made.  A new cleaning product was to be trialled.

·         The cleaning of streets on the outer areas of the City was raised.  AMV said that this would be looked into.

RESOLVED:  That a further report on the Strategic Service Delivery partnership be made in six months time.