1 Morland Gardens – Brent’s final word on a potentially unlawful contract

 Guest post by Philip Grant in a personal capacity.

1 Morland Gardens and the community garden, July 2022.

 

Two weeks ago, I shared with you an email I’d sent to Brent’s Legal Director, asking her to reconsider her view that the recent contract awarded for the Council’s proposed Morland Gardens redevelopment was lawful. This was in the light of information I’d obtained under an FoI request.

 

As I think it is important to give the Council a “right of reply” when important points are raised with them and made public, I will ask Martin to publish the full text of the email I received on 25 August. For completeness, I will also include the response I sent on 30 August, and divide the two with an illustration.

 

If you haven’t already done so, it will probably help to read my earlier guest post (see “link” above). The first email, from Brent, is not “light reading”, but it does give anyone who may be involved in similar disputes with the Council a flavour of what they might expect! Here it is:

 

‘Dear Mr Grant

 

Thank you for your email of 18 August that was received whilst I was on leave.

 

I have now had an opportunity of reviewing your email.

 

I note that you have helpfully highlighted key parts of your email on which you seek a response from me. 

 

You indicate:

 

I believe that Brent Council has failed to treat those “economic operators equally and without discrimination” as required by Regulation 18(1).

 

This statement relates to the process operated by Council Officers in the direct section of a preferred contractor under Schedule 1 of the Network Homes Framework Agreement.  Paragraph 3.1 reads that:

 

‘Direct selection may be used where the Client or any Additional Client considers that it will demonstrate best value for a Project. Subject to paragraph 3.2, the Client or any Additional Client will make a decision on who to directly appoint for a Project based on a best value assessment using a combination of the Contractor’s tender submissions for the Framework and where relevant the Contractor’s:

3.1.1    knowledge and experience of, or relationship to, the site of a Project;

3.1.2    capacity (quantity of work currently instructed) under the Framework;

3.1.3    previous performance under the Framework; and/or

3.1.4    resources available for the particular Project.’

 

It is clear that under the Network Homes Contractors Framework, “Additional Clients” must carry out an assessment using a combination of the Contractor’s tender submission for the Framework and where relevant the various matters detailed in 3.1.1 – 3.1.4.  Officer’s approach to the best value assessment is contained in the Direct Award Evaluation Process Document, particularly in paragraphs 2.3 – 2.6 and paragraph 2.9.  There is no requirement under the direct award procedure to contact bidders directly in carrying out such assessment.

 

Hill Partnerships Ltd. detailed knowledge of the Morland Gardens site was considered significant and as detailed in paragraph 2.6 of the Direct Award Evaluation Process Document:

 

“It is felt this is a key element of the best value justification as the supplier knows the site and the requirements of the project and would need little time to provide a compliant tender for a call-off from the Network Homes Contractor Framework Lot 3….”

 

 You further state:

 

I also believe that the answer to question 6 of my FoI request, about Brent Council’s contacts with Hill Partnerships Ltd over a possible contract award under the NHCF, shows that there is a clear breach of Regulation 18(3).

 

As you indicate, Regulation 18(3) of the Public Contracts Regulations 2015 (PCR 2015) states:

‘For that purpose, competition shall be considered to be artificially narrowed where the design of the procurement is made with the intention of unduly favouring or disadvantaging certain economic operators.’

 

I do not consider that Officers selection of the Network Homes Contractors Framework was in breach of Regulation 18(3) of the PCR 2015.  By its very nature, the use of any framework will unduly favour those economic operators on the framework but the use of frameworks is provided for in the PCR 2015.  Indeed the PCR 2015 permits the use of single supplier frameworks.  The selection of a framework of itself is therefore not unduly favouring or disadvantaging certain economic operators.

 

From the Direct Award Evaluation Process Document it would appear that Officers followed the direct award process as provided for in paragraph 3.1 of Schedule 1 of the Network Homes Contractors Framework and as such it is not considered that this process unduly favoured or disadvantaging certain economic operators.

 

You state:

 

The procurement process, which Cabinet approved on 20 June, was designed “with the intention of unduly favouring” one particular economic operator, Hill Partnerships Ltd.

 

Cabinet on 20th June 2022 approved the following recommendations:

 

2.1       Approve the inviting of a tender using a direct award process under the Network Homes Contractor Framework agreement on the basis of the pre-tender considerations set out in paragraph 3.6 of the report.

2.2       Delegate authority to award the contract for the Morland Gardens Redevelopment Design and Build contract following the successful outcome of the tender exercise to the Strategic Director, Regeneration & Environment, in consultation with the Cabinet Member for Finance, Resources & Reform.

 

For the reasons detailed above, the selection of the Network Homes Contractor Framework agreement of itself is not considered to be unduly favouring or disadvantaging certain economic operators contrary to Regulation 18(3).

 

Further it was indicated to Cabinet in the report that a contractor would be selected to tender based on a best value assessment.  Cabinet in making its decision did not therefore know which organisation would be identified for direct award.

 

In view of the above, I do not consider that there has been an unlawful contract awarded for the Morland Gardens project.

 

Best wishes

 

Debra Norman

 

Director of Legal, HR, Audit and Investigations’

 

Regulation 18, Public Contracts Regulations 2015. (From the Government website)

 

This was my response to Debra Norman’s email of 25 August:

 

This is an open email

Dear Ms Norman,

 

Thank you for your email of 25 August. Your response was not unexpected, as I know that you will always seek to defend Brent Council and its staff.

 

I will not prolong this correspondence unnecessarily. You have set out your position, and we will have to agree to disagree.

 

It is quite clear from the evidence (especially the answer to question 6 of my FoI request) that when Council Officers realised, at the end of May 2022, that they would not be able to award the Morland Gardens contract to Hill Partnerships Ltd under the Notting Hill Genesis Framework, they were looking for a way to award the contract, to that contractor, as quickly as possible by another means.

 

The Network Homes Contractor Framework provided the means, as it allowed for the direct award of contracts, and Hill Partnerships Ltd were one of the approved contractors under its Lot 3. The Direct Award Evaluation Process was carried out, as required under the Framework, but in such a way (because of the timeframe constraints imposed) that there was only one possible outcome.

 

That is why I still consider that the procurement process, approved by Cabinet on 20 June, was designed “with the intention of unduly favouring” Hill Partnerships Ltd, so that it breached the Public Contracts Regulations 2015.

 

Best wishes,

 

Philip Grant.

 

Question 6 and Brent’s response, from my Freedom of Information Act request.

 

You can make up your own minds as to whether or not Brent Council’s 1 Morland Gardens contract was awarded unlawfully!

Philip Grant.

1 Morland Gardens – Brent’s new contract is lawful, says Council.

 Guest post by Philip Grant in a personal capacity

“Altamira” and the community garden - a rare traffic free moment at Hillside, July 2022.

 

Last month, Martin published a guest post I had written asking whether or not the new contract Brent proposed to award - for the demolition of the heritage Victorian villa, “Altamira”, at 1 Morland Gardens, and construction of a new college facility and flats – was unlawful.

 

On 18 July I wrote to Brent’s Legal Director, questioning whether the proposed contract complied with the Public Contracts Regulations, 2015 (“PCR 2015”). I also questioned whether the requirement in Brent’s own Contract Standing Orders (“CSOs”), that Cabinet had ‘received and considered a report setting out all the relevant information’, before they authorised the Strategic Director to make the award, had been followed.

 

I received the Legal Director’s response on 1 August. As I believe in openness and transparency in my dealings with the Council on important issues, especially where other residents have shown an interest in the matter (and thank you all for that interest), this is what she wrote:

 

‘I have now had an opportunity of liaising with Officers and will seek to address the issues you raise in your email.

 

I would confirm that reference in my previous email to Regulation 33(8) of the Public Contracts Regulations 2015 (PCR 2015) was indeed to Regulation 33(8)(a) and that when inviting a single contractor to bid from the Network Homes Contractor Framework (Framework), the Council complied with its obligations under Part 2 of the PCR 2015 in accordance with Regulation 37(6)(c).

 

I note you indicate: 

 

None of this was actually made clear in the Officer Key Decision Report, which the record of the Key Decision confirmed it had relied on (‘the report sets out the reasons for the decision.’).

 

Whilst the Officer Key Decision report does not expressly refer to the particular Regulations referred to above, paragraph 3.5 of the report does indicate:

 

In accordance with the Framework’s rules for a direct award process, the council identified Hill Partnership Ltd as the framework bidder that demonstrated best value for this opportunity.

 

Paragraph 5.2 of the report confirms that participation in the Framework is legally permissible, which involved a review of the Framework to confirm that it complied with the requirements for frameworks set out in the PCR 2015.  Further, paragraph 5.4 confirms that the Council followed the rules for tendering.

 

In the circumstances, it is considered that the report contained sufficient information for the Strategic Director of Regeneration & Environment to make an informed decision on the award of the contract.

 

With regard to the process operated in selecting a contractor to bid, Officers followed the direct award procedure set out in Schedule 1 of the Framework, comparing all contractors on Lot 3 and concluding that Hill Partnerships Ltd. best met the criteria set out in Schedule 1.  All contractor’s qualitative responses to the framework tender were reviewed and all met the council’s requirements. However, the other contractors on the framework did not have the resources available to meet the timescales the council required in order to meet the GLA grant funding requirement to be in contract and the project beginning in August 2022 and did not have the same level of knowledge and experience of, or relationship to the project site.

 

As it is considered that the direct award procedure set out in Schedule 1 of the Framework was used appropriately, it is not accepted that the award has been made with the intention of unduly favouring one economic operator.

 

You state you believe that there is a strong case for saying that the approval given by Cabinet on 20 June does not meet the requirements of Contract Standing Order 88(c). The Standing Order requires that Cabinet should receive and consider a report setting out all relevant information necessary to enable it to give such approval(s) as it considers necessary. I have responded to the points raised in the attachment to your email below.

 

You are concerned that Members of the Cabinet had from 4.30pm on Thursday 16 June and 10am on Monday 20 June when the Cabinet meeting began to consider the report on this particular issue.  None of the members of Cabinet expressed any concern as to the time they had had to consider the matter or raised any questions which indicated they had not understood its content.  There is no reason to think they would not have raised queries if they had had any. I have no reason to doubt that they diligently considered the content of the report prior to the meeting at which the decision was taken and were not reliant on comments by the Leader in order to understand what they were being asked to agree.  It was perfectly in order for the Leader to present the report. 

 

You are correct that there is an inconsistency between the legal implications section of the report and the recommendations in terms of the Cabinet member with whom consultation would take place.  However, the content of the recommendation itself clearly takes precedence and is what Cabinet members agreed to in making their decision. I have no doubt cabinet members were perfectly clear as to the cabinet member with whom they were agreeing the Strategic Director would consult.

 

The Protocol to which the Scrutiny Committee is required to have regard required it to come to one of the following conclusions:

 

§  That the matter should be referred back to the decision maker for reconsideration with reasons for its request and what the committee wants the decision maker to do.

 

§    That it does not object to the decision and the decision can be implemented. 

 

In this case, the committee determined that it did not object to the decision and the decision could therefore be implemented. 

 

The essence of the call in was a concern about the timing of the award of the contract and as to any inclusion of pre-construction demolition of building in stage 1 of the contract.  On the basis of discussion at the meeting, the committee decided it did not object to the award at this time of a contract for the Morland Gardens development.  The issue of which framework would be used for that award was not a part of the call in nor of the decision made by the committee. 

 

I do not consider there is any reason for supposing member of the Cabinet were confused as to the decision that the Scrutiny Committee had considered at its meeting.  It is perfectly clear in the report that Cabinet is being asked to agree a new process for awarding the contract as soon as possible.

 

You are concerned that the previous mini competition was too long ago to provide a reasonable price comparison and that the price may have significantly increased.  This is not the case.  With a direct award under the Network framework, the contractor is required to submit a project specific price, with overhead and profit figures not exceeding those they tendered for the framework.  The price that Hill Partnerships Ltd submitted complies with these requirements and was a similar price to that submitted during the November 2021 tender.

 

Paragraph 5.2 of the report refers to Standing Orders and summarises the relevant content of Standing Order 86 in respect of Frameworks.  I do not consider not including the number of the Standing Order has any implications for the report or the decision made in relation to it. 

 

Having considered the various points you have raised I do not consider there is any reason why the award should not now proceed.’

 

Cabinet authorising the award of a new contract on 20 June, in 59 seconds. (From Brent’s webcast)

 

The Legal Director has stated, about the Cabinet decision, ‘I have no reason to doubt that they diligently considered the content of the report prior to the meeting at which the decision was taken.’ My reply was: ‘I have to admit to some scepticism over your response in connection with the Cabinet's consideration of the Report on the Authority to Award, both before and at the meeting on 20 June.’ I’m sure there will be others who share my scepticism!

 

I am also sceptical about the claim that Council Officers considered all of the contractors under Lot 3 of the Network Homes Contractor Framework (“NHCF”), before deciding that Hill Partnerships Ltd was the one who best met the criteria for the direct award of the contract. The bid they made in response to the invitation under the NHCF just happened to be the same* as the one they’d made under a different framework, which Brent would have accepted if they had not run out of time to do so!

 

If Council Officers did do all that consideration and review of the other contractors, there should be documentary evidence, so I have requested that “audit trail” under Freedom of Information. 

 

“Altamira” from the community garden – the corner of Brent’s proposed new 9-storey building would be where the Sundisc sculpture (a Harlesden City Challenge public artwork) now stands.

 

My FoI request will not stop the award of the contract, which may have been done already. The Legal Director’s reply refers to ‘the project beginning in August 2022’, but can it really begin straight away, especially “on site”? 

 

The former Brent Start college building, including the Victorian villa, is now being used as a home by “Live-in Guardians” (I’ve told Brent’s Capital Projects team that I am quite happy with that, as it should protect the heritage asset from vandals!). And the land in front of 1 Morland Gardens, which Brent’s plans need, so that they can build out over it, is still the subject of objections to the Council’s proposed Stopping-up Order. It is likely to be Spring 2023, at the earliest, before those objections are resolved, hopefully by an independent Inspector, and the decision could go against the Council.

 

Philip Grant.

 

* Hill Partnerships Ltd November 2022 tender bid was £37,933,491. Their July 2023 bid is £37,933,561. Perhaps the extra £70 is an “admin. fee” for re-submitting the same paperwork?