Agenda item

(Report to follow)

Report DRR17/034

At a meeting of the Executive on 9 November 2015, officers were instructed to market test the library service using a procurement strategy based on competition with negotiation to enable officers’ flexibility to work with bidders to realise savings.

Members of the R&R PDS Committee were now requested to consider the outcome of that market testing and provide comments to the forthcoming meeting of the Executive on 19 July 2017.

Further confidential details relating to the award of contract for the provision of library services was considered in an accompanying Part 2 report (DRR17/035).

In outlining the report, the Director, Culture, Renewal and Recreation, made the following representations:-

‘Firstly, I should apologise to members of the Committee for the late publication of the two libraries reports, with hindsight I should have perhaps maintained my original position of calling a special meeting once all of the work was completed. However, when I agreed to bring the reports to this meeting I was of the view that this could be achieved. It then transpired that GLL asked for an extension of time to submit their final tender price which we agreed to, but this then caused a knock-on delay in the final evaluation which when considering the complexity of the bid meant that I was late in releasing the reports.

Having said that though, Members will be aware that there have been a significant number of reports tabled concerning the commissioning of library services and in many respects the two papers on the agenda tonight bring to a conclusion to this piece of work.

In particular, in November 2015, through the Gateway report concerning “Proposals for a Commissioned Library Service”, the Council agreed to begin a process of market testing the Library Service. This decision was made in the context that over the coming years the Council will need to continue to deliver multi-million pound savings from its revenue  budgets. The tender invited potential interested service providers to submit an application to deliver library services on behalf of and under the supervision of the Council, creating a commissioned library service.

In summary we are asking the Executives to agree to:

Award a contract to Greenwich Leisure Limited (GLL) for a period of ten years to run the councils library service with an option for a five year extension.

This is on the basis of the current service, so for instance:

·  The same number of libraries that the Council currently provides (14)

·  The same operating hours as provided now.

·  Same number of days of opening as provided now.

·  Same number of new books purchased as now

·  Same or similar activities as provided now.

·  The Councils library team TUPE transferring to GLL.

We are not envisaging any redundancies as a consequence of this TUPE transfer.  Two posts will be retained to form the client team to act as the interface between the Council and GLL.

The contract, subject to the Executive agreeing would go live on 1 November 2017 and would generate significant revenue savings for the Council over the life of the contract.

The contract, should it be awarded, allows for continuous development and improvement and both parties are keen to explore how the service can be developed over the life of the contract to drive up usage of the library service.

It is worth noting at this point that GLL will only be contracted to run the service on the Council’s behalf; any decision affecting the direction of travel for the service, amendments or changes to the service will be for the Council to take through the normal democratic process.  In other words the Council will retain full control of its library service and will monitor contractual performance twice yearly against a detailed set of key performance indicators and service levels.

GLL are an experienced public library provider, operating library services in Greenwich, Wandsworth and Lincolnshire as well as in prison libraries on behalf of the Ministry of Justice. They are a long established charitable social enterprise experienced at working with local authorities and communities.

The 2016 CIPFA statistics show that in 2015/2016 The Royal Borough of Greenwich achieved 2,408,866 visits, the highest total number of visits to any London library authority.

In addition, Greenwich also had 8,766 visits per 1,000 population, the highest number of visits per 1,000 population across the country.

Wandsworth Borough achieved the highest number of issues in London - at 1,432,685.

There are two reports on the agenda, the Part 1 report provides members with details of the procurement process and the staff consultation that has been undertaken.

The Part 2 reports sets out the financial information behind the GLL bid and the positive  impact on the council’s revenue budgets going forward over the life of the contract.

The project team:- Mrs Moore, Mrs Jackson and Mr Woolgar are all here tonight to answer any questions or comments that Members may have in relation to the two reports.’

Councillor Michael was informed that the Local Authority would retain ownership of all libraries.  Whilst GLL were able to procure books at a cheaper rate than Bromley, the Council would still pay for them and would, therefore, own them.  GLL would however, be responsible for employing staff and managing the libraries.

Councillor Allen considered the scheme to be a form of privatisation and for this reason she could not support the proposals.  She questioned how GLL could possibly make a profit from the scheme without making staff reductions.  She added that the consultation results were misrepresented as the questions asked had been misworded.  Councillor Allen also raised concerns about the continuous improvement plans and how these would be monitored.  Just  maintaining the service as it currently operated was the absolute minimum expected.  She also feared that GLL were known to employ staff on zero hours contracts and did not pay the living wage.

The Director of Commissioning reported that £190m worth of Council services were currently outsourced, the majority of which worked well.  Organisations such as GLL operated like businesses and worked on a more efficient basis.  A summary of the benefits of their bid to deliver the library service and deliver savings on the Council’s annual operating budget were outlined in paragraph 3.19 of the report.

In regard to Councillor Allen’s concerns around zero hours contracts, the Director Culture, Renewal and Recreation informed Members that GLL were asked to provide their observations on this.  Having originated from the leisure industry, GLL had various contracts in existence with 70% of hours worked delivered by staff on permanent open-ended contracts, 30% of hours worked were delivered by staff whom were casually contracted.  Libraries were a more fixed operation where only 10% of hours worked were delivered by casual workers.  It was GLL’s view that it was easier to keep staff on the Local Government Pension Scheme.  He also reported that a lot of misinformation was contained in the Trade Union document. 

The Director, Commissioning confirmed that existing staff would be transferred across on existing Terms and Conditions.  She emphasised the Council was required to save a total of £24m over the next four years.  Going ahead with the proposed scheme would ensure that the same level of service was maintained whilst offering security to staff.  Should Members decide not to go ahead, it was probable that less advantageous options would need to be considered. 

Councillor Phillips alluded to the fact that the same concerns were raised when Members considered the Council’s shared service for library back-office and management functions with the London Borough of Bexley.  None of those concerns were proved correct.  Staff would be protected through TUPE.  The Council was doing its best to maintain services and for this reason Councillor Phillips supported the proposals.

In response to a question raised by Councillor Huntington-Thresher, Members were informed that GLL were aware of the on-going project to redevelop Chislehurst Library and that the contract had the ability to manage such changes to library buildings.  Going forward, officers would also work with GLL on the modernisation of various other libraries within the Borough.

Mr Tim Woolgar, Library Operations and Commissioning Manager, reported that new technology was being introduced to assist people in digital literacy and provide services for profiling local communities to ensure suitable stock was obtained for each library.  E-books and e-magazines already formed part of the stock fund and would continue throughout the contract.  The contract would allow an IT refresh from day one with a second refresh from year 6. 

Members were assured that as a procurement activity, the Council would retain greater control over the contract.  Any suggestion or change put forward by GLL would be considered by officers and decided by Members.  GLL would be required to report to the Committee bi-annually.

In summing up, the majority of Members agreed that whilst libraries delivered an excellent service, something needed to change to enable the Council to save £24m as mentioned previously.  It was envisaged there would be no loss of professional staff as a result of the contract.  GLL were able to purchase more stock with less money and would do more in terms of community activities.

RESOLVED that the report be noted and Member comments be submitted to a meeting of the Executive on 19 July 2017.

Councillor Allen’s dissatisfaction with the proposals was noted.