Decision Maker:

Outcome: Abandoned

Is Key Decision?: Yes

Is Callable In?: No

Date of Decision: February 2, 2026

Purpose:

Content: RESOLVED:   1.  To approve the business case and direct award of a contract via Fusion21 Framework ‘Building Improvement Works’ for Kitchen’s and Bathroom’s Works to Wates Property Services Limited at a value of £3,000,000 for 1 year with the option to extend by one further year at the Council’s absolute discretion. 2.  To approve the business case and direct award of a contract via Fusion21 Framework ‘Building Improvement Works’ for Kitchen’s and Bathroom’s Works to Chigwell London PLC at a value of £2,000,000 for 1 year with the option to extend by one further year at the Council’s absolute discretion 3.  Also to be noted that an annual report on the performance of these two contracts, as well as the tracking of the social value commitments, will be presented to Hackney Procurement Board annually.     Reasons for Decision   The reasons for proposing this capital work procurement option are set out to include consideration of:   ·  The need for the Council to fulfil its legal obligations as a landlord for the maintenance of its homes and estates; ·  The opportunity for capital investment works to contribute to broader Council ambitions of creating a fairer, safer and more sustainable Hackney; ·  The ambition is to ensure   The key deliverables for this procurement are:   ·  Procuring construction services to ensure the Council can invest in homes to fulfil its legal obligations as a landlord; ·  Procuring these contracts in line with the provisions of the new Housing Asset Management Strategy 2019-2027; ·  Provision of cost-efficient, quality-driven related works across the entire housing stock, which are focussed on the greatest investment need, and meet all relevant technical standards; ·  Appointing contractors who are suitably flexible in their scope to respond effectively to resident consultation suggestions for works to homes and estates; ·  Maximising the indirect social value from these contracts through local employment, community investment and resident satisfaction with the quality of their homes and local area; ·  Ensuring that capital works can support the Council’s broader sustainability objectives, such as the air quality action plan, as well as improving the energy efficiency of homes to reduce fuel poverty; ·  Ensuring compliance with the Council's Standing Orders, Regulatory Procedures, and the Council’s Corporate Policy.   The proposed contract is intrinsic to meeting the Mayor’s priorities for a fairer, safer, and more sustainable borough. These priorities include the Mayor’s vision that everyone in Hackney has a good-quality and stable home and the commitment to ensuring the Council continues to invest in and make the best use of its housing stock to provide the homes, blocks, and estates in which people want to live and are proud of.   The proposed contract is a key driver in managing and maintaining Hackney’s housing stock efficiently and sustainably. This procurement strategy is aligned with the objectives of the Housing Asset Management Strategy 2019-2027. The strategy sets out capital work objectives for investing in our homes and estates, the ambitions that Hackney has for the quality of its homes and the related priorities to ensure that the limited available resources are directed at the greatest need. This investment includes fire safety and energy-efficiency measures that are essential to providing homes that are safe, decent, and fuel-efficient for our residents.   The Landlord and Tenant Act 1987 places a legal duty on the Council for the repair and maintenance of the Council’s homes and estates. The new contracts make a significant contribution to undertaking this statutory function.   The capital works to support the Asset Management Strategy, which sets out the objectives and priorities for investment in the existing housing stock and other Housing Revenue Account (HRA) assets and the financial parameters for the planned investment programmes.   Summary of Procurement Process Used   Due to a reduction in budget availability for this financial year, as detailed within 4.5,4.6 and 4.7 above,  the scope of this contract has been reduced from internal and external works to internal works only. There are currently circa 285 properties covering the High and Low Risk Hackney programmes for 2025/26, that require domestic kitchen renewals and bathroom renewals within the current financial year. They will also incorporate works to rectify possible hazards to residents in the home, including damp and mould. The high risk programme also covered internal fire safety works. The appointed contractor(s) will be required to complete all properties within a 30 week period as a minimum.   A procurement strategy was agreed to deliver a short term internal works only contract across high and low risk programmes of work, with one contractor for each programme. Given the time constraints to secure a contract, it was agreed by the Housing Service that a direct award call off opportunity be issued under Fusion21’s Building Improvement Works Framework (Contract Notice 2023/S 000-025888) Lot 9 and Lot 1 - Kitchen and Bathrooms. It is proposed to set a contract term of up to 2 years (1+1).   The Fusion21 Framework, and this Lot has been successfully used by the Council previously for this scope of work and allows direct awards.    The Fusion21 Framework is a highly competitive framework which allows access to a discounted set of rates and charges due to the volume discount that was secured under competition. Additionally Hackney has secured an independent professional opinion from a leading QS that the rates are attractive when benchmarked.   On 7th October 2024 the Cabinet Procurement & Insourcing Committee  approved the Business Case (Key Decision CHE S393) titled Planned Capital Works Contracts for Property Asset Management, for up to £180,000,000. As a result of financial challenges that came to light in early 2025, a reduction in scope was needed to ensure continuity of delivery with the budget challenges at hand. The table within section 4.7 highlights reduction in scope that was needed and the changes between the Business Case and this award report. This award falls under this Business Case.   Alternative Options Considered and Rejected   Option 1 - Consider moving to a Long-term Capital Work Partnering  Contracts In March 2025 the team reviewed procurement time for a flexible competitive procurement exercise. This option would take over 12 - 18 months to achieve, whereas the external framework route could be completed in 4 to 6 months. At this point in time, the use of an external framework route is preferred because of the urgent need to mobilise new contractual arrangements.   The Council must continue the capital investment programme to prevent delays in major repairs and ensure that essential safety projects are carried out promptly. Delays in capital projects could also lead to extra strain on repair budgets. Therefore, not proceeding with the proposed Planned Capital Works - Term Contracts for Property and Asset Management would significantly reduce capital investment over the next two years.   While this option may, in the long term, provide a better route to delivering our capital work programmes, it was rejected at this point due to the length of time it would take to get contractors on the ground and the risks associated with the need to deliver much-needed capital improvement work and essential fire safety work.   With the level of budget currently available, this option would not necessarily be feasible. However, Procurement has advised that a framework agreement or long term capital works partnering contract should be established, and with no guarantee of work, the contract would be in place for the time when the budget is available to deliver larger programmes of work.   A Business Case was approved in October 2025 to establish a framework agreement for 2+1+1, and work on the procurement process will be undertaken shortly. The Capital Works Partnering Contract is also currently being discussed between Procurement and PAM. This option has been included on the procurement pipeline for the longer term consideration for provision of capital delivery across PAM.   Option 2 –  Procure a Stand Alone Contract for each Project  The option of carrying out individual procurement exercises on a project basis awarding a contract for each property was rejected, as this would involve significant work in carrying out public procurement exercises, which require additional staff time. This option involves an individual tender process to let any capital work. Furthermore, this would include the two-stage leasehold consultation, where work is subject to recharge, which means extended contract mobilisation onsite.   Generally, this option requires more resources than the preferred option to use an external framework, and would take much longer to procure resulting in extended wait time for tenants for much needed capital improvement work.   For the reasons above, this option was rejected as the main course of action, though the Council may elect to pursue it if conditions arise.   Option 3 – Insourcing the Works to the DLO The option of in-sourcing the planned capital works is not viable. The scale of the work and risks associated with it makes it neither desirable nor possible to restructure the DLO in time to carry out this work. This option was rejected because it was considered undeliverable within the timeframe.