Purpose

The purpose of the report is to seek approval
in accordance with Contract Procedure Rule 12.2.3(b), to extend the
term of  contract with SHAP Ltd for the
Property and License Agreement Management of the Council’s
Dispersed Temporary Accommodation Portfolio by 8.5 months
 
The reason for the decision is as supported by
Contract Procedure Rule 12.2.3(b): Additional Supplies, Services,
or Works by the original Contractor have become necessary and a
change of Contractor cannot be made for technical or economic
reasons (e.g. interchangeability or interoperability with existing
equipment, systems, services, or installations).
 
The Council has seen a considerable increase
in demand for temporary accommodation for homeless applicants in
Knowsley. The number of dispersed temporary accommodation units has
increased by 622% since the initial portfolio of nine properties in
2014 to 65 properties in 2023. However, over the past six months
demand for homeless temporary accommodation has risen considerably
with the number of households requiring assistance at times peaking
above 100 during May and June which has prompted further plans to
increase dispersed provision to reduce the Council’s reliance
on hotel provision to meet excess demand. Given that demand for
dispersed provision will increase further it is proposed to review
the current commissioned arrangement to determine whether
commissioning the management service continues to provide the best
outcomes for the Council. The proposed extension of the existing
contract will ensure continuity of property management of the
Council’s temporary accommodation portfolio whilst Strategic
Housing undertakes a strategic review of the service provision and
options, to determine whether the service should be brought back in
house or whether the service should continue to be
commissioned.

Decision

(i)       That, in accordance
with Contract Procedure Rule 12.2.3(b) the contract with SHAP Ltd
for the Property and License Agreement Management of the
Council’s dispersed Temporary Accommodation Portfolio be
modified by extending its term for a total of 8.5 months from 1
October 2023 to 15 June 2024. 
 
(ii)       That the Procurement
Team be authorised to issue the relevant contract modification
documentation.

Alternative options considered

Option A – Seek Competition (Quotation /
Tender): Given the need to increase dispersed homeless temporary
accommodation provision it is considered that undertaking a
procurement exercise now would fail to take account of the
Borough’s needs going forward. 
Seeking competition at a later date is therefore the preferred
option for the long-term but would need to be informed by the
proposed strategic service review.
 
Option B – Deliver the property
management service in house: The Council does not currently have
staffing, procedures or property management IT systems in place
that would be needed in order to deliver the management of the
property portfolio and licence agreements. Therefore, this is not
an option that can be implemented in the short term.
 
Option C – Cease delivering a management
service for temporary accommodation at the end of existing
contract: This is not a viable option as it would interfere with
the Council’s ability to effectively discharge its statutory
homeless duty.  Existing dispersed
temporary accommodation used for homeless households would continue
to need day to day management.