Decision on Kent joint venture due in September as single bidder remains

The Cabinet at Kent County Council is expected to make a decision in September on whether to proceed with a landmark joint venture involving its legal services team.

The timeframe was revealed in an update prepared for a meeting this week of the local authority’s Governance and Audit Committee. The document also covers the latest developments in relation to the council’s Back Office Procurement Project.

The competitive dialogue procedure is currently taking place for both projects, “to refine the solution and iron out any issues or concerns with the bidders’ solutions”.

The update adds: “During this time, we are on schedule to receive their solution and at this stage we will get full visibility of the price and the quality documentation that form the bidders’ response.”

Earlier this month (1 July) a paper prepared for the authority's Policy and Resources (P&R) Cabinet Committee revealed that there were two bidders engaged in the competitive dialogue process for the legal services joint venture.

"They are both end to end legal practices with a national coverage. Both already have partnerships in place with other organisations with whom they have formed successful Alternative Business Structures," the document said.

However, there is now only a single bidder. The latest Governance and Audit Committee update says that in relation to legal services this bidder's presentation and the internal baseline will – together with the findings from a recommendation report – go before Kent’s Commissioning Advisory Board on 9 September. There will be an open invite to all members to attend.

The following day will see publication of a Cabinet Committee paper (with recommendation paper) to the authority’s Policy & Resources Committee and to Cabinet Committee.

On 18 September the Cabinet Committee paper will be presented to the P&R Committee. Cabinet members will be invited to sit in to hear any comments they have.

Then, on 21 September, the Cabinet Committee paper will be presented to the Cabinet at Kent and a decision taken.

The update meanwhile reveals that all legal advice for the legal services review has been provided by law firm TLT, to avoid any conflict of interest. TLT is also acting on both procurements to mitigate any potential contractual conflicts that may arise.

The process of selecting a joint venture partner has so far taken almost 18 months, since the authority’s Transformation Advisory Group selected plans for a commercial partner and ABS out of six options for the in-house legal services operation. A ‘soft’ market engagement exercise was also undertaken.

In October 2014 the county council issued an OJEU notice inviting expressions of interest in formatting a joint venture/alternative business structure with Kent Legal Services. The ISOS (Invitation to submit outline solution) deadline for submission by bidders was 16 February 2015.

Led by Geoff Wild, the Kent Legal Services team has an annual turnover of approximately £9m. Of this, between 6-8% is undertaken for external clients. Overall, a surplus of around £2.5m was generated before deduction of corporate overheads.

The proposed joint venture has previously been estimated to be worth £100m over the full ten-year term. It will cover the delivery of services to the authority as well as other clients.

Potential benefits identified by the council arising out of the joint venture are:

• The opportunity for Kent to receive an initial capital investment on setup;
• The opportunity for sustainable growth and for the council to have an interest in an appreciating asset;
• An increased income stream for the authority;
• Recurring savings on the cost of the annual county council legal spend.

In February the county council approved plans to create a ‘general counsel’ role if the joint venture goes ahead.

This would replace the post of Director of Governance & Law and be the county's senior lawyer. It would encompass: Monitoring Officer; SIRO (Senior Information Risk Owner); County Returning Officer; Deputy lord Lieutenant; Democratic services; Information Resilience and Transparency; Legal Commissioning Intelligent Client; and Legal Services (Commissioned service).

The papers said that if for any reason the joint venture outcome were not achieved, the current Director of Governance and Law role would continue unchanged.