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A decision made (20/07/2007) regarding: Clos de Roncier - Deviation from the normal competitive tendering process.

Subject:	Clos de Roncier - Deviation from the normal competitive tendering process
Decision Reference:	MD-H-2007-0050	Exempt clause(s):		Public
Type of Report: (oral or written)	WRITTEN	Person Giving Report (if oral):
Telephone or e-mail Meeting?		Report File ref:		WR- Clos De Roncier Tenders
Written Report – Title	Le Clos De Roncier Refurbishment- Replacement Heating Systems- Deviation from the normal competitive tendering process	Written report - author		David Reid – Capital Projects Officer
Decision(s): The Minister approved the deviation from the normal competitive tendering process.
Reason(s) for decision To comply with Financial Direction 5.6, paragraph 5.7.4 on the basis that the proposal not to follow the normal competitive tendering process in respect of the heating system replacement works for phase 2 Clos De Roncier on the basis that the proposed negotiated contract with the Jersey Electricity Company provides a material advantage.
Resource implications Financial: NIL Manpower: NIL Property: NIL ICT: NIL Law Drafting: NIL
Action required:
Signature: (Minister/ Assistant Minister)			Date of Decision: 20 July 2007

Clos de Roncier - Deviation from the normal competitive tendering process.

Date of Report: - 27th June 2007

REPORT FOR HOUSING MINISTER

LE CLOS DE RONCIER REFURBISHMENT

REPLACEMENT HEATING SYSTEMS -

DEVIATION FROM THE NORMAL COMPETITIVE TENDERING PROCESS.

Background

The Minister will recall that in 2005/06 the Department undertook to refurbish houses nos 1 -18inc; the works were designed predominantly, to improve the thermal envelope and energy performance of each property.

The ‘scope of work’ included the replacement of the old metal ‘Crittal’ style of window with PVCu, including the front and back doors. The buildings were then shrouded in a proprietary cladding system, re-tiled and the loft insulation augmented.

Heating Systems

In 2005, tenders were sent out to 3 electrical contractors for the installation of a replacement electrical heating system for nos 1-18inc; the JEC were the only company to return a competitive price. As a result, the mixed heating systems (Gas & Solid fuel) were replaced with a night storage heating system based around the JEC’s Comfort Heat Tariff.

The installation of this new heating system at the JEC’s fixed tender price represented good ‘value for money’. The project also benefited as a direct result of the consistency of contractor, culminating in a seamless connection to the newly installed Low-Voltage sub-main cable, also installed by the JEC.

Historically, the Department has enjoyed ‘value for money’ and a good working relationship with the JEC, who regularly win tenders based on the ‘economies of scale’ which they can generate as the Islands main electrical supplier.

The Housing Department continues to benefit from their well established customer care regime; which has already been put in place for nos 1-18.

Proposals for Phase 2

The application for detailed planning approval for the refurbishment of houses 19 – 83 inclusive is scheduled for submission to Planning in November 2007.

A programme of works leading up to this submission date has been drawn up which includes the installation of new electric night storage heating systems. Preparations are underway for the refurbishment of the remaining 65 houses and the Department has secured the heaters for these properties from the JEC at a discounted rate.

A meeting between The Housing Department and the Clos De Roncier Residents Committee was held on the 10th May 2007 to discuss the programme of works for the refurbishment of the estate. In particular, the residents were keen to make use of any possible opportunity to bring forward works ahead of the Planning Process.

One means of meeting this aspiration whilst making use of the Summer and early autumn weather would be to replace the heating systems in all of the remaining houses immediately. The Department is proposing to continue with the heating system replacements and has negotiated a price with the JEC at 6.02% lower than that submitted for houses 1 – 18, in 2005. Given cost of living rises in the intervening period this new price is in excess of 10% lower.

The Housing Department is tireless in its pursuit of value for money; however, such are the benefits in time and customer satisfaction of continuing to employ the JEC on this scheme that the Department is not proposing that these works be put to competitive tender.

Financial Direction No 5.6 ‘The control of capital expenditure’ sub-para 5.7.4 allows for deviation from the competitive tendering process, where it can be demonstrated that;

‘A negotiated contract with a known contractor, whose services have previously been engaged through a competitive process on a similar project, provides a material advantage’.

With this in mind, the Department would like to continue to employ the JEC, who have already provided the heaters for phase 2 at a discounted price. The Company has provided written assurances that their prices for the phase 2 installation will be 6.02% lower than the phase 1 price.

Recommendations

That the Minister endorses the proposal not to follow the normal competitive tendering process in respect of the heating system replacement works for phase 2 Clos de Roncier on the basis that the proposed negotiated contract with the Jersey Electricity Company Limited provides a material advantage to the Department.

D Reid

Capital Projects Officer