Issue - meetings

Report of the Corporate Director of Finance and Resources. To be presented by the Cabinet Member for Finance and Corporate

DECLARATIONS OF INTEREST MADE FOR THIS ITEM:

None

RESOLVED:

That Cabinet, after considering the information within the exempt appendices:

1.    Approved the Full Business Case for the replacement of the Council’s Enterprise Resource Planning (ERP) system, including the procurement of an integrated ERP solution, its implementation, and, if required, business integration and support services.

2.    Approved the commencement of two linked procurement activities in accordance with Contract Standing Order (CSO) 2.01(b), comprising:

3.    Delegated authority to decide whether to proceed with the procurement of Business Integration services to the Corporate Director of Finance and Resources, in consultation with the Cabinet Member for Finance and Corporate Services.

4. Approved a waiver of Contract Standing Order 6.03, pursuant to CSO 18.01.4(a), allowing the procurement to proceed with a Social Value weighting of 5%.
   
   
5. Approved the transformation element of the proposed budget, including implementation, stabilisation, licensing, support and associated costs, to be funded through the Flexible Use of Capital Receipts programme, subject to Full Council approval of the additional allocation required.
   
   
6. Noted that an increase in the revenue budget would be required when the new system became operational in July 2028. This would be considered through the 2028/29 budget-setting process and Medium-Term Financial Strategy.
   
   
7. Noted that:

·       the cost estimates were indicative and had been developed using market engagement, benchmarking, risk allowances and contingency provisions;

·       final contract values and the recommended supplier or suppliers would be subject to a future Cabinet decision; and

·       no cashable savings had been assumed at this stage, with potential benefits to be further assessed during procurement and implementation.

Reasons for the decision

The existing SAP ECC platform was approaching the end of mainstream support in December 2027. Following that date, the Council would have become increasingly dependent on third-party support arrangements and faced heightened risks relating to security, payroll operations, legislative compliance, system resilience and audit assurance.

The current system was also limiting operational efficiency. Core Finance, Procurement, Human Resources and Payroll processes relied on manual workarounds, offline spreadsheets, duplicate data entry and fragmented workflows. This increased the risk of errors, reduced efficiency and limited access to timely and reliable management information.

The recommended option was supported by a structured assessment process. The Council undertook market engagement, considered five options, and evaluated them against agreed criteria. Delivery approaches were tested through a Request for Information process and supported by a ten-year total cost of ownership assessment.

The Council was required to procure the technology, implementation, support and associated services in accordance with the Procurement Act 2023, Contract Standing Orders and relevant procurement legislation. The proposed route to market was a further competition through the Crown Commercial Service Back Office Software 2 (BOS2) framework.

The Council confirmed that it was an eligible contracting authority under the  ...  view the full decision text for item 10

The Cabinet Member for Finance and Corporate introduced the report

It was stressed that the Council is focused on improving core services and organisational effectiveness.

It was explained that the Council was currently relying on manual processes and offline spreadsheets to support some finance, human resources and procurement activities. It is considered essential to modernise these systems to support the efficient delivery of services.

It was stressed that the Council needed a modern Enterprise Resource Planning (ERP)system. The risks associated with operating a system approaching obsolescence were recognised, and it was noted that some other local authorities had already implemented replacement solutions. To address this, the administration approved a procurement route and funding envelope, with a final supplier recommendation and confirmed costs to be presented to Cabinet at a later stage.

The Cabinet Member stressed that the procurement of a new system must follow appropriate procurement procedures and demonstrate good value for money. Given the Council’s financial position, expenditure would be subject to close scrutiny. However, replacing critical technology infrastructure was vital to ensure both operational effectiveness and service delivery.

It was explained that the proposed investment is intended to improve internal processes and enhance the experience of residents and staff. The aim is to provide systems that are more reliable, accessible and efficient when residents interacted with Council services, including making payments and submitting applications.

The administration stated its intention to secure greater value for money from the procurement activity and to focus on efficient and effective use of public resources in support of local communities.

Following questions from Councillors Carlin and Cawley-Harrison, the following information was shared:

• It was stressed that the age of the current system meant that there was limited capacity for linkage of systems across the Council currently. It was explained that the Council was looking to implement the new system to deliver a higher quality of service. It was explained by officers that the new system was aimed to be a high-quality and high-tech system which could utilise some Artificial Intelligence (AI) capability to help ensure a much improved user experience and improved interconnectivity with other Council systems.
  
  
• It was noted that the estimated budget envelope was not available in the public report but was available for Members to review in the exempt report so they can see the wider financial implications of the proposal. It was stressed by the Cabinet Member that there were obvious commercial sensitivities preventing publishing the numbers in the public report. Officers stressed that the scoring and methodology for selecting the successful bidder would be available nearer to the point of award.
  
  
• It was stressed by the Cabinet Member that the social value and quality of the contract were equally important to the Council. However, it was also stressed that there currently was no set Council social value policy which would have given the Council the framework to achieve better outcomes. It was noted that there were some targeted attempts to improve social value, including requirements to mitigate digital  ...  view the full minutes text for item 10