The Eastern Highways Alliance. A Progress Report
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1 The Eastern Highways Alliance A Progress Report Regional Transport Form 10 th September 2010 Dr Alastair Jefford, Associate, CWC Ltd
2 The Sponsor for this collaboration is Colin Chick (Luton Borough Council) on behalf of EEDET and the work has been led by Cambridgeshire (Mark Kemp as chair of the Highways Network Board) Improvement East have facilitated the work by successfully seeking money from the Department of Transport to pay for the initial phases.
3 Aspects Covered Benefits of collaboration - experience elsewhere Benefits of collaboration - conclusions for the East Aims and objectives of the Alliance Underlying ethos Participating authorities Subscriptions and fees Key next steps
4 Why collaborate? Save money, deliver cost avoidance Share best practice Make better use of resources Improve service delivery Through EEDET the Highways Network Board has a good track record of developing collaboration between authorities. The need for and benefits of collaboration are therefore appreciated already. The EHA should act as a spur to greater collaboration
5 MHA Efficiencies Summary LA s Actual m Predicted m Total Procurement ECI and innovation Commodities Professional Services Total m
6 Seminar Findings for Potential Collaboration Term Maintenance Big business - annually work to the value of 340m is carried out in the East There is scope for bringing best practice and efficiency savings through the use of Open Book working and/or target costs There is a need to improve the knowledge and understanding of efficiencies that can be made in term maintenance activities through inter authority collaboration Larger capitalised maintenance schemes could be procured through a medium schemes framework (VfM) Significant benefits would accrue from collaborative work on best practices and benchmarking to drive efficiencies
7 Seminar Findings for Potential Collaboration Schemes Framework 3 authorities use a framework for schemes. 4 more use their Maintenance contractor. So there are already some procurement savings and ECI benefits. However arrangements do not: assure VFM with comparison opportunities drive performance via competition allow for speciality With falling capital expenditure the Authorities see a framework as providing flexibility and speed to site as much a benefit as procurement savings
8 Benefits of collaborative frameworks Involving several contractors Savings in procurement Elimination of procurement timescale Lower supplier bidding costs Shared setup costs Economies of scale Work awarded using contractor performance Longer term relationship with supply chain Maximise opportunity for early contractor involvement Shared innovation
9 Schemes framework likely throughput A four year throughput of just under 103m from 2012/13 to 2015/16 Derived from estimating likely annual spend of authorities on schemes then applying a probability of putting the work through the framework eg Thurrock only 25% of schemes spend Hertfordshire 80% of schemes spend Needs re-visiting late Autumn when current budget uncertainties are clearer First Steering Group meeting has taken place, lead by Hertfordshire
10 An Alliance Agreement Unincorporated Association by Agreement Aim Through EEDET to help highway authorities improve highway services in the East of England and help them delivery efficiency savings Objectives To establish and develop collaborative framework(s) to deliver medium size schemes To develop, establish and implement a continuous improvement model for highway term maintenance contract to achieve convergence to best practices To establish and develop other collaborations as agreed by the EHA To embed partnering principles and construction best practice in all its work and throughout the supply chains To promote and publicise the work of the EHA
11 Underlying Ethos A flexible approach to procuring highway services based on an inter authority approach Further development of best value, vfm and construction best practices using a partnering approach with private sector partners and the whole supply chain Rationalisation of systems and procedures enabling duplication of effort to be reduced for members Fostering innovation and making savings Creating more open processes and performance Benchmarking Developing skills to implement and deliver best practices
12 Participating Authorities The following authorities have indicated they are founding members; Cambridgeshire, Essex, Hertfordshire, Luton, Norfolk, Southend, Suffolk and Thurrock. This is an excellent critical mass. Bedford Borough Council support the concept of an Alliance but feel it is not appropriate to join now. Peterborough City Council also support the Alliance but are founder members of the MHA and so will not be founder members of the EHA.
13 Subscriptions and Fees Running costs and costs of developing new services will need to be covered An Annual Subscription would be needed to help with running costs, starting in a financial year to be agreed eg. 2,500 for unitaries and 5,000 for counties from 2010/11? Fees will need to be paid for the use of facilities set up by the Alliance if frameworks and other services/goods are to be procured. Improvement East money from the DfT is crucial as start up money but the alliance needs to be financially sustainable
14 Next Steps Procure a framework with say three contractors to deliver schemes up to the value of 10m, lead by Hertfordshire Establish best practices in term maintenance work and promote them Initiate a programme of work to improve benchmarking, incentivisation and value for money including savings and innovation achieved through the Alliance Refine governance through EEDET Seek continuing funding support from Improvement East and the DfT Promote the Alliance internally and externally as an excellent means of self help to drive improvement
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