Paul McGarry, Head of futureMerton, introduced the item highlighting that the report provides a summary of the re-procurement process for the highways contract from now until the commencement of the new contract in October 2019. A draft scope is also included. This will be developed into a more detailed specification and therefore members’ views on the scope are sought.

The contract is currently held by FM Conway – it is in the last year of a two year contract extension. Soft market testing activity has already taken place from which it has concluded that the contract renewal will be determined through a full procurement process with full exposure to the market to test best value. The length of the contract will be for seven years initially with the option to extend by a further three years.

As part of the early stages of the procurement process there has been liaison with neighbouring boroughs to explore the option of joint commissioning. Richmond and Wandsworth already have a shared contract as do Sutton and Kingston. As these contracts have already commenced and their timing is fixed, there isn’t an option for Merton to join either of them at this stage.

In response to member questions, the following clarification was provided:

·         (Paul McGarry) The proposed length of the contract has been determined by what is typical in the market. Also, to allow the timing of the contract to come in-line with those jointly commissioned contracts already commenced by neighbouring boroughs;

·         (Paul McGarry) Merton’s highways are all subject to an ongoing programme of inspections with frequency determined by use – the busiest are inspected monthly with the least busy inspected annually. These inspections inform the programme of planned capital works. The material with which potholes are filled is robust. However, further derogation of the road surface will typically happen around this infill. Reported potholes are assessed. This will determine if the hole will be filled or the whole road resurfaced through the capital programme;

·         (Chris Lee, Director Environment & Regeneration) Highways maintenance is funded from both revenue and capital budgets. Typically, there is a £660K revenue spend on potholes. This is for day-to-day repairs that cannot be capitalised due to accountancy rules. The capital spend is £2.5m a year on road and footway surface renewal with additional funding for road junctions and changes to road layouts. Contractors are making their own capital investments in equipment to deliver these highway contracts. This is also a key factor in determining the length of the contract as time is needed to defray the capital investment;

·         (Paul McGarry) Consideration is being given to introducing a risk based approach to highways maintenance. However, this will be influenced by London Councils given a change of approach by DfT and will only be effective if adopted across all London boroughs;

·         (Paul McGarry) Merton’s highways are the council’s largest physical  asset; if all our roads, footpaths and cycle paths were laid end-to-end they stretch from Merton to Barcelona. Whilst potholes result in damage  ...  view the full minutes text for item 4