Multi-Academy Trusts (MATs) have experienced increased budgetary pressure as a direct result of Covid-19 and its impact on education provision. Whilst there has been cost savings associated with staffing, maintenance and utilities resulting from fewer pupils being in school during lockdown periods, the costs of deep cleaning and the significant investment in EdTech infrastructure to facilitate home learning has imposed a drain on finances. Notwithstanding the Department for Education’s (DfE) £2.6bn funding increase for the 2020/21 academic year, academy trusts continue to encounter financial constraints and pressure to demonstrate value through procurement when spending public funds. So, how can a procurement framework support MATs with their responsibilities under the Academies Financial Handbook (AFH)?
In our first thought leadership article of the year Framework Manager Faye Dolan, with support from Rob Tyler at Baily Garner, will discuss how Procure Partnerships Framework can support Multi-Academy Trusts and how we can help support education projects.
Value for Money
In accordance with the AFH, value for money is defined as ‘achieving the best possible educational and wider societal outcomes through the economic, efficient and effective use of resources, the avoidance of waste and extravagance, and prudent and economical administration.’ The Chief Executive Officer is held accountable for demonstrating to the public and to Parliament value for money in the procurement process and showing how their academy trust has secured value for money in their governance statement included within the audited accounts.
Procurement frameworks can be a huge benefit to MATs, as they are contracts that have already been negotiated by local authorities, central government departments or public buying organisations to achieve compliance and best value agreements with suppliers. These organisations make deals available to educational establishments and other public sector bodies. The guidance and support offered by a procurement framework is invaluable to MATs who often lack a dedicated team proficient in procuring Capital works. Frameworks have already undergone a competitive tendering process; they comply with public sector procurement regulations and preferential terms and conditions have already been negotiated and secured. MATs can carry out a ‘mini-competition’ involving selective suppliers on the framework who can bid for the contract, which is a lot quicker and simpler than setting up a new contract independently. Procurement frameworks provide the best route for MATs who want to achieve demonstrable value for money in their procurement processes.
Support with Tenders
MATs are primarily financed by the DfE, making them ‘contracting authorities’ as defined by procurement legislation, and so must comply with EU and UK procurement law when tendering for and awarding contracts for goods, works and services. MATs are required to advertise contracts relating to works over the value of £4,733,252, through the Find a Tender Service (FTS); the UK’s post-Brexit equivalent of the Official Journal of the European Union (OJEU). It is important to award works contracts using the sound procurement principles of fairness, transparency and without prejudice, ensuring all potential bidders are treated equally. MATs do not always have a full time Head of Estates in situ who can initiate and manage the tendering process for construction works, which is where a construction framework specialist, like our team at Procure Partnerships can assist. We have a dedicated team with industry knowledge and expertise who can organise site visits and co-ordinate meet the buyer events to support MATs with compliance, legislation, and value for money.
National Support with Project Delivery
As MATs do not generally have high volumes of capital projects each year, procuring through a framework can offer the support of an experienced and professional procurement team who can assist with project delivery, offer guidance as to realistic timeframes, help to deliver strategic targets and conduct project feasibility reviews to include key risk advice. An academy trust can form their own procurement framework agreement, or set one up in collaboration with another MAT, or join an established procurement framework. Established frameworks have a national presence, and with MATs having a national coverage, this can be an important benefit when it comes to partnering with a suitable contractor.
Flexible Call Off Options
There are several flexible call-off methods offered through a procurement framework to suit the specific project timescales. The tender process can take a ‘single-stage,’ ‘two-stage mini competition’ or ‘direct award’ approach. Single-stage tendering is a more traditional fixed cost up front approach separating design and build. Two-stage tendering is a popular method for construction contracts offering flexibility and collaboration on design and build. With a Direct Award route, a framework contractor is directly selected for a project without re-opening competition. Contractors can work under a PCSA to develop any remaining design, or the project can be fully re-priced. This certainly has its advantages where a contractor must be appointed quickly as soon as funding becomes available. A professional procurement framework organisation can help guide and assist MATs to choose the best call-off method for their project specific requirements.
Available Funding Streams for MATs
There are a few government funding streams available to MATs to help with financial support of essential improvement works.
– The Condition Improvement Fund (CIF) is an annual competitive bidding round for eligible educational establishments to apply for capital funding. The funding priority is for refurbishment and improvement to the condition of the buildings to ensure education providers can offer a safe and efficient space to improve educational outcomes for pupils. CIF also supports a small number of expansion projects for providers rated good or outstanding by Ofsted who can demonstrate a need to expand. Eligibility criteria is based on an applicant’s ability to evidence strong governance and good financial management.
– School Condition Allocations (SCA) is a fund allocated each year by the DfE to help maintain and improve the condition of school buildings and grounds. Eligibility criteria states a trust must have five or more schools open at the start of an academic year and have a demand for investment in priorities across the schools for which they are responsible.
– The Public Sector Low Carbon Skills Fund (LCSF) is a funding stream initiated by the Department for Business, Energy, and Industrial Strategy in partnership with Salix Finance to support public sector bodies identify and develop energy efficiency and low carbon heat upgrade projects with the support of experts for non-domestic buildings such as academies.
– Public Sector Decarbonisation Scheme is a £1bn grant scheme for public sector bodies to fund heat decarbonisation and energy efficiency measures to make their buildings more sustainable and reduce their overall environmental impact, supporting the Government’s goal to achieve net zero carbon by 2050.
Why Frameworks work for MATs
Procuring through a professional and experienced procurement framework organisation will ensure the right balance between quality and cost. Efficient procurement practices through frameworks allow MATs to make financial savings, offer peace of mind that the works will be carried out by a reputable and reliable contractor, ensure projects are delivered on time and within budget, guarantee legal and financial obligations are complied with and that key sustainability targets are met.
Procure Partnerships Framework simplify the procurement of works for MATs; provide value for money, save time, support with project delivery and call-off methods and track key sustainability KPI’s.
Rob Tyler, Education lead at Baily Garner,Commented: “We have seen considerable benefits for MAT’s in accessing services via Frameworks for consultants and contractors alike which provides a cost-effective route to market. Frameworks have begun to respond to demands across the industry, many of which facilitate prompt, direct award which allows MATs to expedite their procurement processes and subsequently delivery of capital works. MAT’s have peace of mind that those who have secured a position on respective frameworks have been through a vigorous procurement exercise, typically to assure both cost and quality.”