London Borough of Enfield (19 010 925)

Category : Other Categories > Commercial and contracts

Decision : Not upheld

Decision date : 31 Mar 2020

The Ombudsman's final decision:

Summary: There is no evidence of fault in how the Council dealt with a tendering exercise for businesses to provide services.

The complaint

  1. The complaint, whom I shall refer to as Mr C, complains about how the Council dealt with a tendering exercise for businesses to provide services. Mr C says:
    • The Council failed to honour a verbal agreement for his company to provide services.
    • The contract was eventually offered to another company, without a formal tendering process.
    • An ex-council officer involved in the tendering process now works for the business which won the contract.

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The Ombudsman’s role and powers

  1. We investigate complaints of injustice caused by ‘maladministration’ and ‘service failure’. I have used the word ‘fault’ to refer to these. We cannot question whether a council’s decision is right or wrong simply because the complainant disagrees with it. We must consider whether there was fault in the way the decision was reached. (Local Government Act 1974, section 34(3), as amended)
  2. If we are satisfied with a council’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

  1. As part of the investigation, I have:
    • considered the complaint and information provided by Mr C; and
    • considered information provided by the Council; and
    • considered the relevant policies
    • spoke with Mr C about his complaint.
  2. I also sent a draft version of this decision to both parties and invited their comments.

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What I found

Legislation and Guidance

  1. Council’s must adhere to the national Public Procurement Policy. The over-riding policy is that all public procurement must be based on value for money, which is defined as “the best mix of quality and effectiveness for the least outlay over the period of use of the goods or services bought”
  2. This should be achieved through competition, unless there are compelling reasons to the contrary.
  3. The Council’s Contract Procedure Rules apply for all contracts of a value under £50,000. They state that for contract with a value greater than £10,000 two or more bids must be sought.
  4. Council’s have the option of using an approved framework for acquiring services. This is an agreement which is in place with a range of providers, which enables Council’s to place orders for services without a full tendering exercise.

What happened

  1. In December 2019, the Council started a tendering exercise for businesses to provide services. It invited 5 businesses to tender for the contract, including Mr C’s.
  2. Records show that Mr C communicated with a council officer about how to submit his bid. I shall refer to this officer as Officer A.
  3. The Council say Officer A left her role in early February, and that they had a limited role in the procurement process. The Council say Officer A had no involvement in any decision about who the contract should be awarded to.
  4. On 26 February, Mr C attended a meeting with the Council to discuss his bid. Mr C has said that Officer A was not at the meeting. Mr C says he was told at the meeting he would be awarded the contract. However, the Council say that no such offer was made.
  5. On 22 March, Mr C submitted further information in support of his bid. However, the Council subsequently contacted Mr C to inform him that it would not be offering his business the contract.
  6. The Council say that it reached this decision, because Mr C’s was the only business to bid, and as it could not compare it to other bids, it could not conclude that the bid offered value for money.
  7. The Council subsequently decided to revise its requirements for the services and place the order for the work through an approved framework agreement.
  8. The contract was subsequently given to business which I shall refer to as ‘Business X’.
  9. Mr C subsequently found out that Officer A was now working for Business X.

Analysis

  1. Mr C complains that the Council withdrew its contract offer, after reaching a verbal agreement during their meeting. The Council however dispute that any agreement was reached.
  2. I was not at the meeting so cannot say what conversation took place, I am therefore unable to if an offer was made or not. I have seen no evidence in any correspondence sent after this meeting, which suggests an agreement was in place. Furthermore, I would consider that any contract offer would be made in writing rather than made verbally. I therefore do not consider there to be any evidence of fault in how the Council dealt with this matter.
  3. Nor do I consider there to be any fault in the Councils reasons for not offering the contract to Mr C’s company. The Council have a clear policy that a minimum of 2 bids must be received. The Council have explained this was not the case, and therefore it was unable to conclude that Mr C’s bid demonstrated value for money.
  4. Mr C says the Council subsequently offered the contract to Business X without a formal tendering process. However, the use of the approved framework is permitted and is therefore an option the Council is entitled to pursue. I therefore do not find fault with this decision.
  5. Mr C strongly disagrees with the Council’s approach and believes that the successful bid did not offer value for money. However, I have found that the Council was entitled to take the approach it did. Therefore, in the absence of fault, I cannot question the merits of decisions made when assessing the bids it received.
  6. Finally, Mr C questions the role of Officer A in the procurement process. Having considered the evidence in this case it is clear Mr C communicated with the officer early in the process, and asked for advice on how to bid.
  7. However, Officer A left the Council, prior to Mr C’s meeting to discuss his bid. I therefore cannot conclude that the Officer A had any involvement in any decisions about which company the contract should be offered to. I therefore cannot find fault with the Council regarding this matter.

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Final decision

  1. I have concluded my investigation on the basis that there is no fault in how the Council dealt with the matter.

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Investigator's decision on behalf of the Ombudsman

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