To approve an extension of the public realm service contract with Balfour Beatty Living Places in line with contract terms and conditions and provide an update on contract management arrangements.

Cabinet members considered a report to approve an extension of the public realm service contract with BBLP in line with contract terms and conditions and provide an update on contract management arrangements. 

The Cabinet member for Roads and Regulatory Services introduced the report, the principal points were raised.

The contract came in 2013 for an initial ten years and a decision was made in 2018 to extend the contract by one year until 31 August 2024. Consideration of further extending the contract is now due.

There are a number of commercial and financial performance issues. The future operating model project is in progress and scheduled for a report in March 2024, these issues are being actively looked at. 

The contract contains the facility for the Council to issue a two year no fault termination. 

Cabinet members discussed the report and it was noted that:

Issues with BBLP were noted and it was queried if the current KPI’s would be reviewed.  In response it was confirmed that the KPI’s are agreed with BBLP and are not reviewed as frequently as they could be.  BBLP have been issued a warning that the KPI’s for next year need to reflect where the Council is now, not where the Council was 5 years ago.  BBLP may not agree to this and the Council would have to revert to the KPI’s set in 2021.  Confirmed this is a contractual decision and both parties have to agree to change the KPI’s.  However, it was confirmed that the Council would then look at other options if the performance received was not as expected. 

Group leaders expressed that the contract with BBLP was not satisfactory.  It was expressed that the BBLP contract has been mismanaged, not managed robustly and should be heavily scrutinised going forward. It was noted that it is important for the KPI’s to be reviewed regularly and updated with the view that new KPI’s should be agreed now.  It was noted that the Council should have more power to run the contract and there should be better preparation in place when a new contract is signed with a provider.  It was queried why there are no KPI’s for 2022/2023, why there was a reason for the decline in performance between 2020 and 2021 and why the minimum performance level is 9 and not higher. 

 In response to queries it was noted that:

• The performance data for 2022/2023 will be available in November 2023. 
• Performance dropped between 2020 and 2021 as a result of the method of calculation year on year. Confirmed further clarification regarding this will be obtained. 
• Regarding the performance level of 9, this was the key target for contract extensions and it is unclear why level 9 was set.  It was confirmed that BBLP have been achieving and above this base line. Confirmed this should have been reviewed and this target should have been made more robust.  
• Regarding being able to direct the contract, it was confirmed that it is a good contract by managing the relationship between the contractor and the commissioner but in the past the Council have not been robust in their commissioning. At present and going forward it was confirmed that there has been a change in how the Council operates with BBLP and the Council are looking at the priorities for BBLP rather than being told by the provider what works should be carried out.
• The s.106 works is managed by the PMO under a separate contract and these are now in a better position. 

It was unanimously resolved that;

(a)        Balfour Beatty Living Places be awarded two extensions in accordance with the Public Realm Contract of one year for each relevant period (to 31 August 2026);

(b)        That the progress in closing out the improvement plan actions is noted and agreed;

(c)        That the progress made in implementing the commissioning and contract management functions and the findings of the SWAP audit are noted.