Roads 2011 Where are we on Procurement Monday 21 November 2011, CBI Conference Centre Steven.dennis@tfl.gov.uk

Signed off Strategy Framework agreement – 4 Lots / Alliances Supplier must be able to provide the full range of services either in house or supply chain Direct call-off by clients within the Lot Area. Clients only have to take the service they want NEC3 Contract We want suppliers to work with us and each other Value for money!

Four Alliance Areas Total estimated value between £747m and £2.64b NE – LoHAC £26m pa NW – LoHAC £35m pa Total estimated value between £747m and £2.64b C – LoHAC £56m pa S – LoHAC £55m pa

Alliance Development Team Joint TfL and LB Contract Development Team Technical Specification work stream What, When, Why & How Procurement work stream Compliance Commercial Work Stream VFM Borough & TfL Liaison work stream Meeting London’s Need

Technical Specification Review of 30 odd existing specifications First Draft send to Boroughs & TfL Two workshops held - 23 Authorities attended 2nd Consultation period ended 4th Nov Formal responses 14 received 2 No Comments 7 very detailed 5 focused on specific areas

Standard Detail Drawing 60 Standard Detail Drawing Produced Five Boroughs volunteered to review them Comments received back and are being taken on board

Procurement OJEU: 5/10/2011 Industry day 24/10/11 – 22 suppliers attended PQQ submission: 16/11/2011 PQQ Evaluation process 17/11/2011 – 2/12/2011 PQQ consensus meeting - 9/12/2011 Prelim report to TLHM Board Dec Final recommendation to TLHM Board Mid Jan

Procurement 2 Announce ITT shortlists end Jan Issue ITT early Feb Tender submission: 12 weeks Award of contracts: November 2012 Contract commence: April 2013

Framework Approach TfL is letting the Frameworks on TLHM behalf TLHM Board have reserved the right to award more than one Lot to a single contractor. Common governance and performance management. NEC Price List provision for Target Cost and Cost Reimbursable Common schedule of rates – Area wide Base price - uplifts for road type / ToD / restrictions Individual Authorities Lump Sum prices Individual Authorities unique item / requirement prices

Common Contract Reviewed existing contracts Input from htma, existing suppliers & authorities Eversheds now appointed to support the project Draft of Framework produced under review within TfL and by external Lawyers. Draft Call off Contract circulated to three volunteer Boroughs for review Allow use of client buying power via E Auctions

Performance Regime Working very closely with the LoHAC Culture Change Working Party Contractual and Non Contractual KPIs Contractual measure contract compliance Non Contractual measure client and supplier joint working and contribution towards client goals Contractual KPIs linked to Framework term length Eight year Framework Term Supplier doesn't achieve them - term reduced Supplier does perform - lost time is awarded back

Stakeholder Liaison All Boroughs asked to give: Any expression of interest If interest for what services and from when Under what basis they wish to procure Lump Sum - SoR Regular meeting with Boroughs most likely to use the new contracts from 2013/14 – Tier 1. Regular forum established with Tier 1 Boroughs. - Open to others Potential users provided with list of asset and contract information required for inclusion in ITT.

National Comparison Highways Maintenance Efficiencies Programme Survey - Over 80 authorities (approximately 55%). The most common form of maintenance contract was the NEC, with over two thirds of authorities using it in some form. A standard form of contract based on the NEC would be welcomed by Local Highway Authorities. 95% of respondents supported the development of a standard specification. 31% of respondents were already in some form of alliance, and 26% were looking into joining or forming such an arrangement.

Benefits Realisation Standard Contract Documents - Staff time savings associated with maintaining bespoke documentation, average £80K* per authority up to £3m based on those likely to go to the market nationally in the near future. overall savings of £12m to be realised if all Local Highway Authorities move to one standard form. Collaborative Alliances for medium sized authorities a figure £1.1m** pa per authority was identified. http://www.dft.gov.uk/topics/local-authorities/hmep/docs/111027-wsg1-survey-update.pdf *TLHM Business case 72k ** TLHM Business case 10-15% savings

Summary On Track Still a lot to do Not to late to join Borough input is vital and appreciated Market response has been very positive Large scale collaborate works Highway Alliances Work

Questions?