Decision By Portfolio Holder
Report reference: HSG-007-2010/11
Date of meeting: 8 August 2010
Portfolio:
Housing
Author:
Lyndsay Swan (Ext 4146)
Subject:
Development of Private Sector Housing Renewal Strategy 2011
Democratic Services: R Perrin
Decision:
That approval be given for a waiver of Contract Standing Order (CSO) C3(2) to allow the
Council to engage the services of the Building Research Establishment Ltd (BRE) to carry
out specialist consultancy work to undertake stock modelling, commissioning surveys and
post evaluation, at a total cost of approximately £12,800 without seeking an estimate from
another provider due to the BRE being the only organisation that provides this service.
ADVISORY NOTICE:
A Portfolio Holder may not take a decision on a matter on which he/she has declared a prejudicial interest.
A Portfolio Holder with a personal interest must declare that interest when exercising delegated powers.
I have read and approve/do not approve (delete as appropriate) the above decision:
Comments/further action required:
Signed:
Personal interest declared by Portfolio Holder/
conflict of interest declared by any other
consulted Cabinet Member:
Date:
Dispensation granted by Standards Committee:
Yes/No or n/a
Office use only:
Call-in period begins:
Expiry of Call-in period:
After completion, one copy of this pro forma should be returned to
Democratic Services IMMEDIATELY
Reasons for Proposed Decision:
The waiver of the CSO would allow the Council to benefit from the use of the BRE’s stock
model and, subsequently, their expertise in procuring a Private Sector House Condition
Survey at a saving of £6,800. No other organisation currently provides this service.
Other Options for Action:
The option not to use stock modeling and to carry out a random survey has been discounted
as this would provide a less accurate result than a targeted survey such as could be
achieved with the use of stock modeling.
As the BRE are the only Company that provide the stock modelling system, there is no option
to purchase it from another provider. While it might be possible to purchase the stock model
from the BRE and then use a different Company to assist with the procurement, as the BRE
will have worked with Council Officers to develop the stock models and in doing so gained an
understanding of the District, it would seem sensible for the same Company to provide
specialist support with the commissioning of the House Condition Survey through the
Procurement Hub.
Another option would be to purchase the stock model from the BRE and then carry out the
procurement of the surveys ourselves. Although the procurement itself will be carried out
through the Hub, the design of the specification of the House Condition Survey will require
the assistance of specialists. Again, it would seem sensible that the BRE provide this service
as they will already have knowledge of the District through their development of the stock
models.
Background Report:
1.
In October 2009 the Cabinet agreed to extend the provisions of the Private Sector
Housing Renewal Strategy (PSHRS) 2007-2009 until 2011 while a new PSHRS is developed
during 2010. The Cabinet also approved a DDF allocation of £55,000 in 2010/11 to fund a
House Condition Survey (HCS) to provide supporting evidence for the Strategy.
2.
In order to reduce the likely cost, approaches were made to neighbouring authorities
to see whether there was any interest in the joint commissioning of the HCS.
Representatives of two other local authorities in the London Commuter Belt sub-Region;
Brentwood and St Albans, said that they were interested and together with Officers from
EFDC, formed a Project Group to take this forward.
3.
The normal approach to undertaking a HCS involves the inspection of approximately
1,200 randomly selected properties by suitably qualified housing specialists. The main
purpose of the work is to identify the number of non-Decent homes occupied by vulnerable
households split by tenure and location, but also a variety of other information such as costs
of essential repairs and energy efficiency. Local authorities generally use consultants to
either procure or carry out the surveys and to assist in the development of their PSHRS. The
Consultants that carried out the Council’s last HCS in 2005, PPS (now CPC) helped to
develop the PSHRS 2007-2009 and the Council will require a similar arrangement for the
next Renewal Strategy.
4.
An alternative approach is to use a system of ‘modelling’ the stock to identify areas
where certain conditions are likely to occur, such as high numbers of properties occupied by
vulnerable people. This allows inspections to be concentrated on those areas, providing a
more accurate result than would be obtained from the more traditional methodology outlined
above. It can also reduce the number of surveys. If the Council uses the stock model it
should be possible to reduce the number of surveys to about 1,000 resulting in a saving of
about 16% on the cost of the surveys. The only provider of the system is the Building
Research Establishment (BRE), a privately-owned company that provides research and
consultancy on construction-related matters.
5.
Other advantages of using stock modelling over a random survey are:
•
A lower degree of statistical variance (error);
•
It is more flexible as it cannot be broken down to smaller areas, such as
Council wards; and,
•
As areas where certain conditions are likely to apply are identified, the effect
of failures to gain access is less noticeable.
6.
In order to explore this option further, representatives of the BRE were invited to
demonstrate the stock modelling system to the Project Group. The Group agreed that the
model would provide a good basis for the evidence and development of Private Sector
Strategies, while at the same time providing good value for money and meeting the
objectives of good practice guidance. The BRE were therefore asked to provide an estimate
for the stock modeling for the authorities, either acting individually or in a collaborative
approach.
7.
As the three authorities forming the Project Group have different requirements and
funding arrangements for the development of their PSHRSs, the BRE were asked to
estimate for the work in two separate phases:
•
Phase 1: Production of the stock model and sample design for the House
Condition Survey; and,
•
Phase 2: Assistance with commissioning and, post-survey, evaluating the
surveyors’ reports.
There will be a further two phases in the development of the Council’s PSHRS:
•
•
Phase 3: The Stock Condition Survey which will procured through the Hub
with specialist support from the BRE; and,
Phase 4: The production of the PSHRS which will be developed by Officers
with assistance of a specialist consultant that worked with the Council on the
development of the last PSHRS in 2005. This work will cost less than
£10,000.
8.
The fees quoted for Phase 1 are based on the size of the private sector housing
stock. The BRE’s standard fee for a stock the size of EFDC’s would normally be £12,100,
however, as the Council had previously purchased stock models from BRE when the last
HCS was carried out in 2005, the BRE offered a discount of 50% on this. In addition to this
they agreed to offer a further 15% to the authorities in the Project Group if they purchased
the stock models at the same time. This reduced the fee for EFDC to £5,313. The fee
quoted for Phase 2 is a standard fee of £7,500.
9.
While all three Councils agreed to proceed with Phase 1, neither Brentwood nor St
Albans Councils propose to procure Phase 2. However, having considered all the
alternatives, EFDC Officers feel that the best option for EFDC is to purchase the stock
models and then engage the BRE, who will have already gained a detailed knowledge from
their work to produce the models, to assist in commissioning the surveys through the Essex
Procurement Hub.
10.
When added together, however, at £12,813 the total cost of Phases 1 and 2 exceed
the limits of Contract Standing Order 3(2) which stipulates that two estimates must be
obtained for work exceeding £10,000. The Portfolio Holder is therefore asked to agree to a
waiver of Contract Standing Orders to allow the Council to benefit by a £6,800 saving on the
cost on the initial phase of the project, to save on the cost of the surveys and use the BRE’s
specialist assistance in the procurement of the surveys.
Resource Implications: £55,000 identified within the DDF to carry out a Private Sector
Stock Condition Survey in 2010/11. Staffing from within existing resources.
Legal and Governance Implications: Regulatory Reform (Housing Assistance) Order 2002,
Housing Act 1985 and Housing Act 2004
Safer, Cleaner and Greener Implications: The 2010 HCS will assist in identifying private
sector homes that have poor energy efficiency and where occupants are living in fuel poverty.
The Private Sector Housing Renewal Strategy that will develop from the findings of the HCS
will include measures to improve the energy efficiency of homes in the private sector in order
to reduce fuel poverty and cut carbon emissions.
Consultation Undertaken: None.
Background Papers: The Private Sector Housing Renewal Strategy 2007-2011.
Impact Assessments:
Risk Management
There is a financial risk that the Government will limit, or withdraw entirely, its funding for
private sector housing renewal if the Council does not carry out a House Condition Survey at
relatively frequent intervals. Although the Government is not specific as to how frequent
recent this should be, the timescale generally accepted by private sector housing
practitioners is 5 years.
Equalities Issues
Many of the measures included in the existing PSHRS target groups that are considered
vulnerable, such as older people and families on low incomes, and disabled people. It
therefore has a positive impact on the Council’s statutory duty to promote equality. A full
customer impact assessment will be carried out on the new PSHRS.
Did the initial assessment of the proposals contained in this report for
relevance to the Council’s general equality duties; reveal any
potentially adverse equality implications?
Where equality implications were identified through the initial
assessment process, has a formal Equality Impact Assessment been
undertaken?
What equality implications were identified through the Equality Impact Assessment
process?
How have the equality implications identified through the Equality Impact Assessment
been addressed in this report in order to avoid discrimination against any particular
group?
Key Decision: N