Liverpool City Council is to take back control of looking after the city’s highways by ending its contract with Amey, by mutual agreement.
A report to the council’s cabinet next Friday (24 November) is to recommend that the nine year contract for the delivery of highways services (established in July 2013) be closed in the New Year as part of a drive to deliver £90m of savings over the next three-year period due to Government cuts.
If approved, the council and Amey will complete the mutually agreed exit by the end of January 2018.
The moves comes as part of a council wide review which has brought parks services, street cleansing, bin collections, IT and HR and Payroll services all back “in house” to deliver further savings.
Although cost savings were initially made under the contract, the council considers that further savings could be achieved in looking at alternative smarter and more flexible delivery methods, as shown with its new pothole repair contracts with the private sector.
Following the negotiated exit, it is also proposed that an interim service be put in place for an 18 month period to allow the council to carry out a detailed review of the various options for future service delivery.
The highways services which are currently delivered by Amey are:
Street Lighting Inspection & Maintenance
Gully/Highway Drainage Maintenance
Highway Structures Maintenance & Management
Street Works Co-ordination
Highway Professional Services
In the short term, it is proposed to separate the current service provision, as follows:
Client based functions and associated resource be transferred back to the Council. This will include, for example, the highway inspections, street works inspections, project management and work scheduling, and professional services (e.g. design).
The operational element of the service and the associated resource, be transferred to Liverpool Street Scene Services Limited (or LSSL). This will include, for example, the gully cleansing operatives, the street lighting operatives, and the white works operatives (e.g. flagging works).
The negotiated exit from the contract will result in eligible staff either transferring back to the council or Liverpool Street Scene Limited (LSSL). The detail of those with TUPE rights will be confirmed 28 days prior to transfer/exit.
Councillor Ann O’Byrne, Deputy Mayor of Liverpool, said: “The stark reality of these punitive government cuts is forcing the council to look at every single penny we spend to ensure not just value for money but to help protect the vulnerable as much as we possibly can.
“The highways contract with Amey LG did initially deliver savings but we believe more can be achieved by bringing the operations back in house.
“We have seen with other services such as street cleansing and refuse collections that insourcing can deliver savings which can be reinvested to make our money go further.”
“Anyone who travels by car through Liverpool knows the city has a pothole issue and the council is doing all it can. Unfortunately this issue is a double whammy because while we are investing £88m in repairs the Government are putting in just £18m.
“The Mayor has already written to the Minister highlighting this lack of investment and we will continue to make the point especially while London receives an inordinate amount of transport investment compared to northern cities like ourselves.”
Councillor Steve Munby, Cabinet Member for Highways, added: “I am confident that this proposal will deliver the best possible value for council tax payers, help us improve services and deliver savings through eliminating management fees and working with staff and the trade unions to promote innovation.”
A further report will be submitted to Cabinet considering future delivery arrangements within 12 months of the exit from the contract.
Amey’s Highways Business Director, David Ogden, said: “We have reached a mutual agreement with Liverpool City Council to end our highways contract early after both sides raised concerns about the sustainability of the contract.
“The financial environment has changed significantly since the signing of this contract and we both agreed that this is the best course of action for all. Working together since 2013, Amey and Liverpool City Council have maintained the highways and street lighting service across the city, and are now committed to ensuring a smooth transition to a new service delivery approach in the coming months.”