SECTION 2 - Local Authority Consultation
SECTION 2 - Local Authority Consultation
Part 1 — Review of current management and maintenance arrangements
Framework, Duties and Auditing
The current third generation term contracts has seen the Scottish trunk road network continue to be separated into four geographical units. Four successful bidders have each established an Operating Company to run one of the four units for five years, each extendable to seven years at the discretion of Scottish Ministers.
Each Operating Company term contract is considered to benefit from operating under the ethos of a partnering culture delivering a spirit of openness and trust. The integrated delivery team has eliminated duplication of effort, optimisation of risk allocation/management and with performance and continuous improvement allowed measurement against auditable key indicators.
The Operating Companies deliver a complete management and engineering service, providing the day-to-day maintenance tasks, winter treatment including provision of all storage plant requirements. They undertake projects valued individually up to £250,000 ‘as of right’ for the renewal and improvement of the fabric of infrastructure and arrange competitions for larger works under discrete contracts whilst supervising the winning contractors.
Question 1
Summary of responses to - Question 1
Most respondents see the current geographical units as appropriate. There were suggestions that the contracts should be structured on the Regional Transport Partnership boundaries.
Where changes were suggested, it was felt that smaller geographical areas might attract local bidders, as there was a loss of local knowledge with national contractors.
One respondent suggested that management responsibilities should be returned to the public sector with approximately 10 regions (replacing 32 local authorities) delivering all services. There was also a suggestion that dual and single carriageways should be dealt with under separate contracts.
Question 2
Summary of responses to — Question 2
Most respondents considered the current duration to be appropriate. Where a longer contract period was suggested it was considered that it may stimulate a higher level in interest in bidding. It was also felt that a longer duration would give greater stability and encourage operators to make more investment in depots and salt stores, although it was acknowledged that such an arrangement would require robust early termination mechanisms for under performing contractors.
Question 3
Summary of responses to — Question 3
Most respondents agreed that the £250,000 level is appropriate for as of right works, but that it should be allowed to increase with inflation.
Two respondents suggested a lower limit of £150,000 (matching the Local Authority limit) to provide more opportunity for other contractors, including Local Authority Direct Labour Organisations (DLOs), to bid for Trunk Road works.
Part 2 - Potential future delivery strategies
Strategy 1 — Developed Operating Company Contracts
This strategy would seek to continue with the principles employed for the third generation term contracts whilst taking into account the experiences learned and also seeking to establish greater partnership working between the new Operating Companies and Local Roads Authorities.
Question 4
Summary of responses to — Question 4
Most respondents saw no significant problems in implementing Strategy 1.
One respondent suggested that the 4G contracts should consider holistically the road network in an area; for example, the benefits of combined working (e.g. winter maintenance and joint purchasing). Other respondents suggested that improvements in the partnering arrangements would be beneficial.
Question 5
Summary of responses to — Question 5
None of the respondents indicated that they would be likely to tender either independently or as part of a consortium. The most common reason given is that they no longer have the resources required for trunk road maintenance. High tendering costs were also a deterrent.
Some councils suggested that they would act as sub-contractors or design consultants if the opportunity arose.
Strategy 2 — Developed Operating Company Contracts (including Collaboration Framework Contracts)
This strategy would, similarly to Strategy 1, seek to develop the Operating Company Contract but in addition it would also make provision for participating Local Roads Authorities to procure services through it.
Question 6
Summary of responses to — Question 6
Respondents were broadly supportive of Strategy 2 but would like to see participation as an additional option. Respondents saw advantages in shared resource, collective purchasing agreements and a co-ordinated approach to services such as winter service. Benchmarking services was also seen as an advantage.
Disadvantages highlighted included the disparity in budgets and service level between trunk and local roads.
Concerns over potential staff transfers where work activities might affect existing Direct Labour Organisations (DLOs) were raised.
Strategy 3 — Maintain, Finance and Operate Contracts
Under this type of contract, the service provider would fully take over the management and maintenance of the trunk road network within a unit, maintain the network to a pre-determined standard and would return the network at the end of the contract in a pre-determined condition. The service provider would have real ownership of the network for the duration of the contract and might receive payments purely in terms of continuing availability and traffic use, and incur liabilities in relation to levels of service, road safety and quality of contract compliance.
Question 7
Summary of responses to — Question 7
Most respondents were not in favour of Strategy 3, stating difficulty in specifying, measuring and monitoring performance requirements, in particular hand back condition.
Question 8
Summary of responses to — Question 8
Local Authorities expressed a preference for Strategy 2.
Question 9
Summary of responses to — Question 9
Alternative strategies suggested by respondents include:
- Separating contracts for single and dual carriageway sections
- Returning responsibility for trunk roads to local authorities and combining the management of the trunk road network with the local road network
- Transferring responsibility for litter picking and sweeping on trunk
roads in non-built up areas to Operating Companies
- Transferring certain busy local roads into the Trunk Road Network
Part 3 — Information on existing or possible future collaboration / partnering arrangements
Benchmarking
"In any environment, understanding an activity’s performance and results compared to those of other undertakings is not only interesting, it provides the opportunity to recognise success or otherwise relative to peer operations. It also provides the stimulus for positive action and also potentially information which through additional analysis and understanding can drive improvement through the spread of best practice. In the private sector although companies do rely on benchmarking internal efficiency and external results there is often, for obvious reasons, a reluctance to share best practice with outsiders, particularly competitors. This inhibitor should not exist in the public sector."
McClelland Report 2006
Question 10
Do you have any knowledge of existing benchmarking mechanisms which Transport Scotland should explore with other organisations? Please provide any relevant details.
Summary of responses to - Question 10
The benchmarking clubs mentioned by respondents includes:
- Association of Public Service Excellence (APSE)
- Celtic Highways Benchmarking Club (CHBC)
- Society of Chief Officers for Transportation in Scotland (SCOTS)
- Scottish Construction Centre
- Local Authorities Groups (e.g. North Ayrshire, East Ayrshire, South Ayrshire and Inverclyde (NESI), Tayside)
- Highway Works Benchmarking Club (National Highway Works Best Value Benchmarking Club)
In addition to the above benchmarking clubs it was noted that there are relevant Statutory Performance Indicators which all Scottish Local Authorities provide to Audit Scotland on an annual basis.
Co-ordination
The existing third-generation contracts make provision for liaison between organisations for the co-ordination of operations
Question 11
Summary of responses to — Question 11
There was an even split in opinion on whether the current liaison arrangements were working well or not. Where the arrangements were not considered to be working well, the reasons given generally related to boundary issues and the use of local roads where diversions are used. There was also concern expressed regarding the lack of co-ordination with public transport operators and local councils over scheduling where delays were expected due to roadworks on the trunk road network.
Collective purchasing
The McClelland Report states that substantial savings should be possible through the collective buying power of public bodies
Question 12
Do you have any knowledge of existing collective purchasing mechanisms which you consider Transport Scotland should explore with other organisations? Please provide any relevant details.
Summary of responses to — Question 12
Scotland Excel was the most often quoted purchasing body. Procurement Scotland was also suggested. Both of these purchasing bodies are overseen by the Scottish Government.
There are a number of Local Authority groups, such as Tayside Procurement Consortium and Tayside Contracts (Perth & Kinross/Angus/Dundee/Fife) and the Society of Chief Officers for Transportation in Scotland (SCOTS) North East electricity consortium.
Economies of scale
The McClelland Report states that substantial savings could be made possible through economies of scale with respect to service delivery
Question 13
Do you have any knowledge of existing arrangements where services relevant to the management and maintenance of the road network are being delivered more cost effectively through economies of scale which you consider Transport Scotland should explore with organisations? Please provide any relevant details.
Summary of responses to — Question 13
Most respondents had no comment on this question. However, 5 respondents suggested local groupings as mechanisms for achieving cost efficiencies through economies of scale; examples offered included North Ayrshire, East Ayrshire, South Ayrshire and Inverclyde (NESI) Group, Tayside Contracts, and recycling partnerships which included both Inverclyde and Renfrewshire .
Question 14
Are there any other existing collaborative/partnership arrangements you are aware of which you consider Transport Scotland should explore with other organisations? Please provide any relevant details.
Summary of responses to — Question 14
Only one respondent had a further example for Transport Scotland to consider which related to a shared radio communication network.
Question 15
Are there any other possible future opportunities that Transport Scotland should explore? Please provide any relevant details.
Summary of responses to — Question 15
Suggestions received from respondents included:
- All litter picking and channel sweeping to be included as part of the Operating Company contract
- Trunk Road boundaries to be set back from the road line at junctions
- Parallel cycle ways to be made part of the trunk road network
- Improving co-ordination of traffic management on urban roads
- Combining trunk and local network management
- Sharing of depots
- Funding of new depots
Future consultation
Question 16
Would your organisation be interested in participating in a face-to-face interview and/or workshop to supplement the outputs from this questionnaire? (YES/NO)
Summary of responses to — Question 16
All but one of the fifteen respondents indicated a willingness to take part in face to face interviews or workshops.