Hampshire Fire and Rescue Authority Item 7

Governance Committee

15/03/200514 November 2008

Review of Financial Regulations and Standing Orders relating to Contracts

Report by the Chief Officer

Contact: Wendy Lambert - Head of Financial and Office Services

Tel: 02380 64000 Ext 2012

1

Summary

1.1

The Authority's Financial Regulations and Contract Standing Orders have remained largely unchanged for over 10 years and, although they have been subject to regular updates, these have been piecemeal rather than the result of an overall review. The financial limits were essentially those adopted from Hampshire County Council when HFRA became a combined fire authority in 1997.

1.2

The review that has been undertaken has therefore been a thorough one and the proposed revision of financial limits and their incorporation in revised Financial Regulations and Contract Standing Orders is significant enough to justify both documents being presented to the Authority for approval.

2

RecommendationError! Bookmark not defined.s

That it be a recommendation to the Authority:

2.1

That the revised financial limits set out in paragraph 4.1 of this report be approved with effect from 1 January 2009.

2.2

That the revised Financial Regulations and Contract Standing Orders set out as Appendices 1 and 2 to this report be approved.

3

Background

3.1

The Authority has had its own Financial Regulations and Contract Standing Orders since April 1997 when it became a combined fire authority. These were based on those of Hampshire County Council and whilst the current versions date from 1 April 2005 and have been regularly updated in line with changes in legislation, guidance, personnel and structure; they are still based on financial limits that are now 10 years old.

3.2

In May 2008, the County Council approved new streamlined decision processes and financial limits in order to improve democratic and business processes by reducing bureaucracy. It made sense to follow this good practice and to take the opportunity to review the Authority's own Financial Regulations and Contract Standing Orders - incorporating the new limits and processes and updating and clarifying specific areas.

4

Changes to financial limits

4.1

Area covered

Current

Proposed

Tenders

(in most cases existing call off or framework contracts should be used when these exist. If not tenders are required.)

At or below £5,000 - three quotes required

Over £5,000 but below £50,000 - at least three tenders must be invited

Over £50,000 - full formal tender procedure required

Above EU procurement limits - compliance with EU procurement directives

Below £25,000 - three quotes required.

At or above £25,000 but below EU procurement limits - at least three tenders required.

Above EU procurement limits - full formal EU tendering process required

5

Contribution to Corporate Aims and Objectives

5.1

The proposed revision of financial limits aims to improve democratic, governance and business processes by:

· Simplifying the number of different financial limits

· Removing misalignment in authorising limits in Standing Orders and Financial Regulations to avoid matters requiring a decision going around the decision making process several times.

· Focusing attention on decisions where cost is significant in financial terms

· Removing the administrative burden of the full tender process for the lower value purchases up to £25,000

6

Risk Analysis

6.1

This review will reduce the risks associated with previous piecemeal amendments to certain parts of the existing Financial Regulations and Contract Standing Orders over the past 10 years. These have led to an increase in the variety and level of financial limits with different decision making processes being required. This has resulted in an increase in bureaucracy, duplication of effort with the same level of scrutiny and control required regardless of the size and potential financial impact of projects.

7

Resource Implications

7.1

There are no specific resource implications resulting from the changes to the documents.

8

People Impact Assessment

8.1

There are no adverse impacts arising from the revisions to the documents.

8.2

The proposals within this report are considered compatible with the provisions of the European Convention on Human Rights, the Human Rights Act 1998, and the Race Relations (Amendment) Act 2000.

9

Consultation

9.1

The Treasurer, Clerk and Monitoring Officer have all been consulted in the revision of Financial Regulations and Contract Standing Orders

Background Information (Section 100D of Local Government Act 1972)

The following documents disclose the facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of the report:

"None"

Note: The list excludes: (1) published works; and (2) documents that disclose exempt or confidential information defined in the Act.