The Arvato Public Private Partnership Arrangement
Decision:
*RESOLVED –
1. That the early termination of the sub-contract with Kier on 31 July 2020 and the return of services to in-house delivery, subject to the satisfactory completion of final contractual negotiations with Arvato and Kier, be approved.
2. That the remaining services delivered directly by Arvato through the Public Private Partnership be brought back in-house on 17 January 2021, allowing key employees critical to enabling a safe transition of services to focus on the development and delivery of the Council’s Covid-19 recovery plans.
3. That the Assistant Director – Customers, Commissioning and Change, in consultation with the Cabinet Member for Business Transformation and Customers, be granted delegated authority to finalise the commercial arrangements with Arvato and Kier to transition services safely and within the budget parameters set by Council for the 2020/21 financial year.
4. That the Assistant Director – Customers, Commissioning and Change, in consultation with the Cabinet Member for Business Transformation and Customers and the Chair of Employment and General Committee, be granted delegated authority to finalise the required employment policies to meet TUPE employment regulations.
REASONS FOR DECISIONS
To enable the Council to safely transfer all employees delivering services through our Public Private Partnership with Arvato and Kier to Council employment, whilst also delivering the recovery activity required as a result of the Covid-19 pandemic.
Minutes:
The Assistant Director – Customers, Commissioning and Change submitted a report seeking approval for changes to the Arvato Public Private Partnership Arrangement.
On 14 January 2020, Joint Cabinet and Employment and General Committee resolved that the services delivered through the Public Private Partnership arrangement with Arvato should return to in-house service delivery from 18 October 2020. However, the disruption created by the Covid-19 pandemic meant it was no longer feasible to remain on track with the exit plan activities required to facilitate a successful transition to Council employment of over 160 employees by 18 October 2020.
Following the Government’s imposed lockdown, Kier asked all of its employees above a certain grade to accept a voluntary pay cut. All of the staff employed by Kier to deliver services for Chesterfield Borough Council, supported by their Trade Union, declined to accept the voluntary pay cut. As a result, Kier approached Chesterfield Borough Council and Arvato with a proposal to bring the Kier sub-contract to an end on 31 July 2020.
A joint project team had therefore been appointed in order to safely and successfully transition Kier employees to Council employment by 31 July 2020.
The Council would work closely with Kier management and the relevant Trade Unions to formally manage communications and consultations with affected Kier employees.
The proposed Heads of Terms allowed for financial due diligence to be completed by the Council before all parties agreed to a contract variation.
It was also not considered achievable to successfully transition the services delivered by Arvato to in-house delivery by 18 October 2020 while ending the sub-contract with Kier on 31 July 2020 and implementing the Covid-19 recovery plans. It was important that key senior officers within Arvato and Chesterfield Borough Council remained focussed on the safe reopening of Council services.
The terms of the Council’s contract with Arvato provided for a contract end date three months after 18 October 2020. Therefore, the partnership arrangement could legally continue until 17 January 2021 without the need for a contract extension. Arvato had confirmed that they would be agreeable to continue to deliver services until 17 January 2021.
*RESOLVED –
1. That the early termination of the sub-contract with Kier on 31 July 2020 and the return of services to in-house delivery, subject to the satisfactory completion of final contractual negotiations with Arvato and Kier, be approved.
2. That the remaining services delivered directly by Arvato through the Public Private Partnership be brought back in-house on 17 January 2021, allowing key employees critical to enabling a safe transition of services to focus on the development and delivery of the Council’s Covid-19 recovery plans.
3. That the Assistant Director – Customers, Commissioning and Change, in consultation with the Cabinet Member for Business Transformation and Customers, be granted delegated authority to finalise the commercial arrangements with Arvato and Kier to transition services safely and within the budget parameters set by Council for the 2020/21 financial year.
4. That the Assistant Director – Customers, Commissioning and Change, in ... view the full minutes text for item 46