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Waverley Borough Council Committee System - Committee Document

Meeting of the Executive held on 01/04/2003
OUTCOME OF VOLUNTARY COMPETITIVE TENDERING EXERCISE OF THE ANIMAL CONTROL SERVICE



As part of the Improvement Plan to the year-2 Best Value Review of Environmental Health, it was agreed that the Pest Control Service should be exposed to competitive tendering in order to establish whether or not savings could be made by providing this service using a private sector contractor.

The purpose of this report is to advise members of the results of the exercise and to recommend how the service should be provided in future. It is concluded that there would be no financial advantage in providing this service by way of a contractor.
APPENDIX I

WAVERLEY BOROUGH COUNCIL

EXECUTIVE – 1ST APRIL 2003

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Title:
OUTCOME OF VOLUNTARY COMPETITIVE TENDERING EXERCISE OF
THE ANIMAL CONTROL SERVICE

[Wards Affected: All]
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Summary and Purpose

As part of the Improvement Plan to the year-2 Best Value Review of Environmental Health, it was agreed that the Pest Control Service should be exposed to competitive tendering in order to establish whether or not savings could be made by providing this service using a private sector contractor.

The purpose of this report is to advise members of the results of the exercise and to recommend how the service should be provided in future. It is concluded that there would be no financial advantage in providing this service by way of a contractor.
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Introduction

1. During 2001/02, the Environmental Health Section of the Environment and Leisure Department carried out a Fundamental Service Review and produced an Improvement Plan as part of the process. This was subsequently agreed by the Executive.

2. One of the actions identified was to expose the Pest Control service to competitive tendering since there are many private sector companies who offer this service and it was thought that a cost saving may be possible.

Background

3. The existing in-house service treats infestations of rats, mice, wasps and other insects. A charge is made for all these services, and they are accordingly approved annually as part of the Council’s review of its fees and charges. The charge for rodent treatments in domestic properties has always been maintained at a level below cost because of the public health implications of rodents. In addition to this, residents in receipt of means-tested benefits receive all treatments at reduced rates that are also subject to the same annual review process.

4. The Pest Control Service is mainly provided by one full-time member of staff. In addition, one full-time member of staff provides a Dog Warden service and the two officers cover for each other in the case of sickness, annual leave or during busy spells (especially the Summer wasp-nest season).

5. Administrative staff within the Environmental Health Section provide additional support by receiving calls, offering advice about treatments available, booking appointments and reconciling payments received.

6. The Pest Control Officer and the Dog Warden are each provided with a Ford Transit van and all equipment and materials are stored in a secure container located at the Broadwater Park depot used by the Countryside section.

7. A survey of customers of the Pest Control service was carried out as part of the Best Value Review showed very high levels of satisfaction and a majority of respondents considered that the service should remain in-house. 91% of respondents considered the overall service, including call booking and treatment, to be satisfactory or better and 87% considered that the Council should continue to provide the service directly rather than contract it out or close it down. Reasons for using the service include reasonable costs, reliable good quality service and trust of Waverley as their local Council.

TENDERS

8. Advertisements for expressions of interest were published in local newspapers and in Environmental Health News, a weekly publication of the Chartered Institute of Environmental Health circulated to all UK local authorities. Tenderers were also offered the option of including the collection of stray dogs in their submission.

9. A number of companies and one local authority applied for the tender documentation. By the closing date for tenders, two completed tenders were received.

10. One tender was from a small local company which did not wish to provide a stray dog collection service. The other tender was from a large national company which wished to offer a dog warden service as well as pest control.

EVALUATION

11. The tenders were evaluated jointly by officers from the Environment and Leisure Department and the Finance Department.

12. The Finance Department provided details of the marginal costs which apply to the Pest Control Service. These are the costs that could potentially be saved if the service was to be provided by an outside contactor. Officers compared the costs tendered by the contractors. The marginal costs for the three years 2000/01 to 2002/03 are shown at Annexe 1 to this report. The figures ignore a one-off situation where temporary staffing was used to cover for a period of staff absence during 2000/01.

13. On average over that three period, a net excess of income over marginal costs of 1,153 was earned by way of the Council operating the service. The range was from a cost of 8,180 to a profit of 9,520. In the current year a small profit of some 2,000 is predicted. However, the amount earned in income each year is very dependent on the number of cases treated and, in particular, on the numbers of wasps’ nests present during any particular Summer period. Experience has shown this factor to fluctuate unpredictably each year.

14. An important factor in consideration of the tenders was the possible transfer of the existing staff under the Transfer of Undertaking (Protection of Employment) Regulations 1981 (as amended), usually referred to as TUPE.

15.

If the Council were to choose the small local tenderer, and if the scale of fees to residents were to remain unchanged, and the demand for services were to remain similar as in the past three years, there would be a cost over income of approximately 20,000 for a full year. This assumes one member of staff transferring under TUPE.

16. The larger national company quoted on the basis of providing a Dog Warden Service as well as pest control. However, the cost of the Dog Warden service alone was 43,713. More importantly, this contractor would not be prepared to take two staff under TUPE. Since it would be necessary for both current staff to transfer if the Dog Warden service was included in the contract, this option was not viable.

17. As a result of these considerations, it is recommended that there are no savings to be made by having the Pest Control service provided by a contractor and it is therefore recommended that the in-house service continue.

Community Safety Implications

18. Rodent and insect pests present significant risks to the health of local people and it is important that they have access to high quality pest control services at prices which they can afford.

Resource/environmental implications

19. The operation of the current in-house service has now been demonstrated to be more cost effective than using a private sector contractor. There is also an advantage in that the quality of the in-house service is known to be very high, is highly rated by customers and is more easily controlled than the quality provided by a contractor.

20. At present the marginal cost of the Pest Control service is such that it shows a small operating profit or loss. The annual review of fees and charges should continue to aim to ensure this be a small profit so that the service remains sustainable without the need for substantial financial support. At the time of undertaking the Fundamental Service Review it was found that this Council’s charges for pest control services were lower than the benchmarked figures for many others. It is therefore recommended that the opportunity should be taken, at the time of the next annual review in the autumn, to bring these in line with the benchmarked average pertaining at that time.

21. There are very serious public health risks associated with infestations of pests, especially rats and mice, being left unchecked or not being properly controlled. Pest Control was therefore one of the earliest functions of local authorities, and remains equally important today. Whilst providing this service in-house is not a statutory requirement it is nevertheless a responsibility of District Councils under S.2 of the Prevention of Damage by Pests Act 1949 to ensure their areas are kept free of infestations of rats and mice. This exercise has demonstrated that the most effective and financially sustainable way to do this in Waverley is to continue with its existing in-house arrangements.

22. The figures given in this report relate to the costs that could potentially be saved were the service to be provided by an external contractor. There are further support costs which would be borne regardless of the outcome of tendering. The full costs of the service are shown in the Budget Book.

"Opportunities for All" Implications

23. The Pest Control service is available to all Waverley residents and a reduced charge is available for people in receipt of means tested benefit. The service is appreciated and trusted by its customers.

Conclusion

24. Having carried out a tendering exercise for Pest Control as recommended by the Best Value Fundamental Service Review, Officers consider that the best option is for the Council to continue providing the service directly.

Recommendation It is recommended that the Executive agrees:

1. to retain the Pest Control service in-house; and

2. to apply the officers’ recommendations for the next annual review of fees and charges in the autumn this year, with the aim of ensuring the service operates in future at a small surplus of income over marginal costs.
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Background Papers (DoEL)

Best Value Fundamental Service Review of Environmental Health

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CONTACT OFFICERS:

Name: Suzanne Robinson Telephone: 01483 523436
E-mail: srobinson@waverley.gov.uk

Name: Martin Shorten Telephone: 01483 523434
E-mail mshorten@waverley.gov.uk

Comms/exec/2002-03/566