Home to School Transport Provision - Review
North Lanarkshire Council · 15 December 2022
Back to Council — 15 December 2022 and its agenda
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1 North Lanarkshire Council Report Full Council Does this report require to be approved? ☐ Yes ☒ No Ref: GMcL Date 21/12/22 Home to School Transport Provision – Review From Gerard McLaughlin, Head of Education (North) E-mail mclaughling@northlan.gov.uk Telephone 01236 812269 Executive Summary On 16 August 2022 at 14:52, Strathclyde Partnership for Transport (SPT) contacted North Lanarkshire Council to advise that they had failed in their obligation to arrange transport for over 1600 children and young people due to attend our schools the next day. This notification came despite previous communication from SPT, as late as 08 August 2022, indicating that over 99% of contracts were in place at that time. The impact of this failure was far-reaching and led to substantial disruption to learning and other service delivery, significant reputational damage, national media coverage and considerable additional costs to secure internal contingency mitigations via emergency planning procedures. This paper, follows decisions taken by the Policy and Strategy Committee on 29 September 2022 and gives a thorough treatment of the steps taken to: • Review events surrounding the initial failure • Assess future risk • Review options to mitigate ongoing risk Management consider that continuing with current arrangements may prove increasingly impractical and/or expose the Council to an unacceptable level of risk and, therefore, it is considered that the Council should examine a range of options which may help mitigate these risks and which will identify a more robust and sustainable way forward, if as seems likely, current pressures continue. The paper suggests options to deal with the root causes and likely future impacts of the initial failure expressed by SPT in relation to market collapse under heavy demand. These options have emerged from a thorough analysis of the risk exposure and additional costs incurred due to this failure. Further sundry recommendations have emerged from a study of existing policy and practice and are deemed to further enhance future resilience. It should be noted that these options may be considered during the budget setting process.
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2 1. Background 1.1 North Lanarkshire Council provides free school transport to over 8000 children and young people. The provision of free school transport is one of the largest non-staffing costs within Education and Families budget. Section 51 of the Education (Scotland) Act 1980 requires local authorities to make such arrangements as they consider necessary for the provision of school transport for pupils attending schools in their area. Local authorities have a wide level of discretion in this regard, but arrangements will take account of factors such as safe walking distance, pupil safety, placing requests, vacant seats, medical conditions, and additional support needs. 1.2 The Act stipulates that provision must be made for pupils under 8 years old who would have a walking distance to school of over two miles and for other pupils whose walking distance would be over three miles. This applies to pupils attending their catchment area school. It does not apply to placing request pupils. 1.3 Provision may be made via free transport, making bicycles or other means available or paying whole or part of reasonable travelling expenses. 1.4 The principal eligibility criterion for mainstream transport is distance from home to school. North Lanarkshire Council is among the most generous in Scotland in this regard being one of only four local authorities extending eligibility to one mile for primary and two miles for secondary. (See Appendix B). 1.5 Transport for pupils with additional support needs is considered on a case-by-case basis and via individual assessment of need by associated professionals within Education, Children and Families. 1.6 The status quo creates a high level of demand for transport provision across North Lanarkshire. In 2022, this demand was placed on a commercial market already depleted due to a lack of qualified drivers, high inflationary cost pressures and fewer Recommendations It is recommended that Council: (1) endorse the contents of a preliminary internal review of home to school transport by NLC and a preliminary joint review by NLC /SPT; (2) note that an internal review by SPT has yet to be published with further reporting to follow; and (3) agree that detailed further reporting on key aspects/issues arising will follow in cycle 2. The Plan for North Lanarkshire Priority Support all children and young people to realise their full potential Ambition statement (7) Enhance collaborative working to maximise support and ensure all our children and young people are included, supported, and safe
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3 commercial operators. This resulted in shortages in provision and considerably higher costs. Whilst this affected most parts of Scotland, North Lanarkshire was among the worst affected areas. 1.7 A preliminary internal review of current home to school transport policy and practice within North Lanarkshire Council has been carried out by officers within Education, Children and Families (Appendix 1). 1.8 On 29 September 2022, Policy and Strategy Committee decided that internal and joint reviews by SPT be endorsed. At the time of writing, the internal review by SPT has yet to be finalised and published. A preliminary joint review with NLC has been completed (Appendix 2). 2. Report 2.1 Preliminary Internal Review of Home to School Transport by North Lanarkshire Council 2.2 Resilience 2.2.1 In response to the initial failure in August 2022, an Emergency Planning Team (School Transport) was established ensuring that contingency offerings could be agreed and put in place within one week and ongoing monitoring arrangements established. 2.2.3 Membership of the Emergency Planning Team (School Transport) includes senior officers from Education, Children and Families, Audit and Risk, Enterprise and Community, Legal, Finance, HR, Strategic Communications and Business Solutions. As well as developing and improving workable contingency measures, the group has maintained close contact with SPT to ensure 80 temporary contracts were evaluated and substantiated. The group also works to ensure that effective contract monitoring is in place; that legal compliance and governance is assured; and that practice is reviewed. 2.3 Methodology 2.3.1 The internal review process examined existing policy and practice in detail with input from officers in Legal, Fleet, Audit and Risk, Finance, Procurement, HR and Education, Children and Families services as well as SPT. The internal review also examined the work and decision-making of the Emergency Planning Team (School Transport) in addressing sudden market failure through enhanced contingency measures, increased spend and detailed risk analysis. Preliminary findings are outlined in the report attached at Appendix 1. These findings cover legal compliance, eligibility, alternative provision, planning, procurement, and operational best practice including digitisation, safety and risk. 2.3.2 A deep dive risk analysis has provided an insight into the broader level of significant risk currently faced by the Council in relation to home to school transport. This analysis captures and documents the wider risk arising from recent events and ongoing market pressures affecting the ability of the Council to meet its statutory duty. These events have demonstrated that the Council is facing, and will continue to face, significant ongoing challenges around market capacity, contractor behaviour/sustainability and
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4 future affordability/best value in delivering its statutory duty to provide home to school transport. 2.3.3 Education, Children and Families will continue to engage with Audit and Risk to ensure that the circumstances surrounding these events and lessons learned are properly reflected in future decision-making. 2.4 Cost 2.4.1 Previously reported difficulties within the current transport market have led to Education, Children and Families projecting a 2022/23 overspend at Period 6 of £5.394m in relation to Transport & Plant. Per the Revenue Budget Monitoring Report, this overspend reflects ongoing demand pressures within ASN transport (£2.703m) and increases to mainstream transport contract rates (£2.674m) along with minor overspends across the Service (£0.017m). 2.4.2 Included within the projected overspend of £5.394m for the 2022/23 financial year is c. £3.092m in relation to observed in-year contract increases and inflationary cost pressures associated with transportation contracts. The underlying position within the Education, Children & Families Service demonstrates an overspend of c. £2.302m across several transportation service provisions. 2.4.3 It should be noted that the Emergency Planning Team (School Transport) has recorded additional reasonable costs of at least £630,000 incurred by the Council in adopting immediate contingency measures. 2.4.4 Also a further potential additional cost of up to £260,000 in relation to the need to quickly secure 80 short term temporary contracts previously put in place by SPT. The total cost provided by SPT as best value in transferring these contracts to a permanent one-year status was £2,583,039. This represents an uplift of around 41% on previous costs compared to a more typical 17% uplift. 2.4.5 These additional costs are still to be fully reviewed and verified by the Service in conjunction with Financial Solutions to prudently determine the adverse variances noted. In addition, recovery of additional spend incurred by the Council as a result SPT’s failure to provide sufficient transport in August 2022 remains subject to ongoing legal discussion. 2.5.1 Summary of Preliminary Recommendations 2.5.1 The internal review identified several positive features of existing practice within school transport including legal compliance, good local knowledge and experience within the transport team, the use of a dynamic purchasing system for procurement and effective partnership with the internal fleet team. 2.5.2 The internal review also identified several areas for improvement including wider policy update, assessment of sustainability impacts, research into user satisfaction and possible options to accelerate digitisation. 2.5.3 A full summary of recommendations is shown at Appendix 4.
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5 2.6 Preliminary Joint Review of Home to School Transport by North Lanarkshire Council and Strathclyde Partnership for Transport (SPT) 2.6.1 A preliminary joint review was completed with SPT in December 2022 (Appendix 2). Key areas reviewed include revised communications, potential supply and demand levers, further joint working, and a revised Agency Agreement. 2.6.2 A summary of recommendations is also included within Appendix 4. 2.7 Internal Review by Strathclyde Partnership for Transport 2.7.1 At the time of writing, SPT advised that a draft report on their internal review was with their leadership team for approval. Publication date was not yet available. Further reporting on this report to follow. 3. Measures of success N/A 4. Supporting documentation Gerard McLaughlin Head of Education (North) Appendices Appendix 1 Preliminary Review of Home to School Transport 2022/2023 Appendix A High Level Data Infographic Appendix B Distance Criteria by Local Authority Appendix C Deep Dive Risk Analysis – Home to School Transport Appendix 2 Preliminary Joint Review with SPT November 2022 Appendix 3 Extract from Policy and Strategy Committee 29 September 2022 Appendix 4 Summary of review recommendations
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6 Impacts ( http://connect/report-template-guidance ) 5.1 Public Sector Equality Duty and Fairer Scotland Duty Does the report contain information that has an impact as a result of the Public Sector Equality Duty and/or Fairer Scotland Duty? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? If Yes, has an assessment been carried out and published on the council’s website? https://www.northlanarkshire.gov.uk/your-community/equalities/equality-and-fairer- scotland-duty-impact-assessments Yes ☐ No ☒ 5.2 Financial impact Does the report contain any financial impacts? Yes ☒ No ☐ If Yes, have all relevant financial impacts have been discussed and agreed with Financial Solutions? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? Financial context is shown at Section 2.3 including current budget overspend and reasonable costs incurred during adoption of emergency measures. Both subject to further analysis. 5.3 HR policy impact Does the report contain any HR policy or procedure impacts? Yes ☐ No ☒ If Yes, have all relevant HR impacts have been discussed and agreed with People and Organisational Development? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.4 Legal impact Does the report contain any legal impacts (such as general legal matters, statutory considerations (including employment law considerations), or new legislation)? Yes ☒ No ☐ If Yes, have all relevant legal impacts have been discussed and agreed with Legal and Democratic Solutions? Yes ☒ No ☐ If Yes, please provide a brief summary of the impact? Proposals to change free transport eligibility criteria would be subject to statutory consultation. Any joint review with SPT has been done without prejudice to any ongoing legal remedies available to the Council to recover reasonable costs incurred as a result of failure to provide transport. 5.5 Data protection impact Does the report / project / practice contain or involve the processing of personal data? Yes ☐ No ☒ If Yes, is the processing of this personal data likely to result in a high risk to the data subject? Yes ☐ No ☐
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7 If Yes, has a Data Protection Impact Assessment (DPIA) been carried out and e- mailed to dataprotection@northlan.gov.uk Yes ☐ No ☐ 5.6 Technology / Digital impact Does the report contain information that has an impact on either technology, digital transformation, service redesign / business change processes, data management, or connectivity / broadband / Wi-Fi? Yes ☒ No ☐ If Yes, please provide a brief summary of the impact? Proposal include potential for digitisation across a range of existing processes. Where the impact identifies a requirement for technology, has an assessment been carried out (or scheduled) by the Enterprise Architecture Governance Group (EAGG)? Yes ☐ No ☒ 5.7 Environmental / Carbon impact Does the report / project / practice contain information that has an impact on any environmental or carbon matters? Yes ☒ No ☐ If Yes, please provide a brief summary of the impact? Some proposals will achieve a measure of carbon reduction by reducing the number of vehicles on the road. 5.8 Communications impact Does the report contain any information that has an impact on the council’s communications activities? Yes ☒ No ☐ If Yes, please provide a brief summary of the impact? Any changes to existing eligibility criteria would require public consultation, increased media relations and potential complaints handling. 5.9 Risk impact Is there a risk impact? Yes ☒ No ☐ If Yes, please provide a brief summary of the key risks and potential impacts, highlighting where the risk(s) are assessed and recorded (e.g. Corporate or Service or Project Risk Registers), and how they are managed? A deep dive risk assessment has been undertaken to determine the ongoing level of risk associated with the current service delivery model and potential disruption. The risk is currently rated as HIGH, with potential significant financial, legislative and reputational impacts noted. Management consider that simply continuing with current arrangements may prove increasingly impractical and/or expose the Council to an unacceptable level of risk and, therefore, it is considered that the Council should examine a range of options which may help mitigate these risks and which will identify a more robust and sustainable way forward, if as seems likely, current pressures continue.
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8 The risk will be continue to be monitored closely by CMT and Education & Families SMT. Detail can be found in the risk analysis at Appendix C. .
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9 Appendix 1 North Lanarkshire Council Education, Children & Families Preliminary Review of Home to School Transport 2022/2023 Contents 1.0 Introduction 2.0 Context 3.0 Scope 4.0 Methodology 5.0 Conclusions 6.0 Other Issues Appendix A Summary of High-Level Transport Data Appendix B Transport Distance criteria by Local Authority Appendix C Deep Dive Risk Analysis
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10 1.0 Introduction 1.1 On 29 September 2022, following reports of significant difficulties and disruption within the current transport market, Policy and Strategy Committee authorised an internal review of Home to School Transport Provision. This preliminary report presents the outcomes of that review. 2.0 Context 2.1 Section 51 of the Education (Scotland) Act 1980 requires local authorities to make such arrangements as they consider necessary for the provision of school transport for pupils attending schools in their area. Local authorities have a wide level of discretion in this regard, but arrangements will take account of factors such as safe walking distance, pupil safety, placing requests, vacant seats, medical conditions, and additional support needs. 2.2 The Act stipulates that provision must be made for pupils under 8 years old who would have a walking distance to school of over two miles and for other pupils whose walking distance would be over three miles. This applies to pupils attending their catchment area school. It does not apply to placing request pupils. 2.3 There is a significant demand for home to school transport provision across North Lanarkshire. In 2022, this demand was placed on a commercial market already depleted due to a lack of qualified drivers, high inflationary cost pressures and fewer commercial operators. This resulted in shortages in provision and considerably higher costs. Whilst this affected most parts of Scotland, North Lanarkshire was among the worst areas affected. 2.4 On 16 August 2022, SPT reported that, due to this strain on the marketplace, transport could not be secured for over 1600 pupils starting North Lanarkshire schools the next day. In response, an Emergency Planning Team (School Transport) was established to ensure that contingency offerings could be agreed and put in place. These required considerable changes to existing provision and practice resulting in significant disruption and increased cost. 2.5 Appendix A provides a summary of high-level data around home to school transport. 3.0 Review Scope 3.1 The Service understands that a preliminary review is required to: a) Identify potential for economy and efficiency whilst maintaining quality and legal compliance b) Improve understanding of external factors influencing the provision of home to school transport c) Examine planning, delivery and reporting processes to ensure they are fit for purpose 3.2 Specific areas addressed include: • Eligibility criteria and demand management • Processes for eligibility assessment • Potential for alternative methods of delivery
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11 4.0 Methodology 4.1 This review made use of the approach taken by the Accounts Commission to structured thinking around passenger transport and those components open to change. Areas include Policy and Compliance, Eligibility, Alternative Provision, Planning, Procurement, Operations, Contract Monitoring, Reporting and Budget. 4.2 Each of these has been reviewed in turn and conclusions presented below. 5.0 Conclusions Policy and Compliance 5.1 The review confirms that our existing practice meets the Council’s statutory duties and government guidance. 5.2 Communication could be improved by the publication of an updated transport policy. This could be revised to clarify any changes to eligibility criteria as well as providing clarity for service users around the appeals process. 5.3 The policy could be further enhanced by associated practice guidelines around areas such safe walking route and the privilege pass scheme. Eligibility 5.4 North Lanarkshire Council provides free school transport to over 8000 children and young people. The provision of free school transport is one of the largest non-staffing costs within the Education, Children and Families service. The principal eligibility criteria for mainstream home to school transport are: Transport qualification 2022 No of pupils Distance 5136 Exception 36 Medical 28 No suitable walking route 2824 Other 290 Privileged 108 Total 8422 5.5 North Lanarkshire Council is among the most generous in Scotland in in relation to distance criteria being one of only four local authorities extending eligibility to one mile for primary and two miles for secondary. Appendix B. 5.6 There is evidence that a change in distance criteria to the statutory minimum would typically reduce overall spend on mainstream transport by around one third. 5.7 Any such change would be subject to statutory consultation and a detailed analysis of each home to school walking route.
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12 5.8 Around one third of our pupils qualify for free school transport on the grounds of having no suitable walking route. The Council has a statutory duty to consider safety when deciding whether to provide transport. In practice this applies when the walking distance is less than the statutory limits. A well-established process exists for doing this. This could be improved however by ensuring that the criteria for assessing route safety and the appeal process itself are clear and available to parents and other stakeholders. It would also be prudent to review the mechanism for considering appeals, with more emphasis on the road safety criteria applied and the legal issues involved. 5.9 Transport for pupils with additional support needs is considered on a case-by-case basis and via individual assessment of need by associated professionals within Education, Children and Families. This works well but could be enhanced by formalising joint working between teams on areas such as periodic review, consistency of decision-making and the possibility of independent travel training for older pupils. Alternative Provision 5.10 Provision of home to school transport may be made via free transport (usually bus or taxi), making bicycles or other means available or paying whole or part of reasonable travelling expenses. 5.11 Provision of bicycles, or grants towards them, is not available in North Lanarkshire but seen as an option by some local authorities, particularly in the summer months, where distances are relatively short and where safe routes are available. Investment in cycling and walking infrastructure would be required to eliminate the need for bus routes which are provided on the grounds of road safety rather than distance. The approach may also be suitable for journeys which are slightly longer than the maximum walking distance criteria. 5.12 This would require assessment of individual routes but can yield benefits not only in cost saving but also in carbon reduction and health promotion through increased physical activity. It would be accompanied by suitable safety protection and Bikeability training. 5.13 The Council’s tactical use of in-house provision has proven to be very successful in supporting contingency arrangements, mitigating risk and building resilience. There remains potential to expand this provision further. 5.14 There is scope within ASN Transport provision to provide parents with reasonable expenses should they choose to provide their own transport. This is typically paid at the HMRC travel expenses rate. The review has found that some authorities are considered expanding this provision to create an allowance model subject to clarification on tax and benefits impacts. Planning 5.15 The principal vehicle for planning mainstream school transport is the formal agreement with SPT which includes application processing, route optimisation, individual contract management and complaints handling. 5.16 This agreement is due for renewal in April 2023. The recent failure by SPT to provide all necessary contracts suggests that a renegotiation of the terms of this agreement is required to ensure that lessons are learnt and that robust risk management and contingency measures are formalised.
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13 5.17 The review notes that the web-based GIS mapping system used internally to determine distance criteria is not always fully utilised with a continuing reliance, in some instances, on “trundle wheel” measurement. The Service may wish to ensure that any potential improvement offered by updated software is fully exploited. 5.18 Planning for ASN transport is undertaken internally and relies on Excel spreadsheets as its primary means of planning and maintaining records. Whilst comprehensive and reasonably secure, the Service may again wish to ensure that the potential improvement offered by updated software is fully exploited. This could help improve: Information governance Information exchange with schools, contractors and service users Cost control and contract management Records of individual decision-making Use of time Procurement 5.19 Contract awards via SPT for mainstream transport and in-house for ASN Transport fall in line with public sector frameworks and guidance. The Service has a strong working relationship with the procurement team and adopts the standard Dynamic Purchasing System (DPS) which constitutes good practice in a constrained market. 5.20 Payment to contractors who provide ASN Transport relies on invoice processing and hard copy batch headers. This can present risks around loss of data. Direct payment options are already being considered to address this. Operations 5.21 Through several staff changes, ongoing review and the recent issues with SPT, the work of the in-house Contracts Team has been tested and reviewed in some detail. This is a relatively small team managing high volume data, extensive provision and significant budget. 5.22 The team has good experience and strong working relationships with other stakeholders. A recent change in management structure has placed an increased focus on improvement and digitisation which is starting to show some benefit. The team is keen to secure investment in new technology to ensure the fullest potential of employees and processes can be achieved. Contract Monitoring 5.23 Whilst the plans for improvement by the in-house team should be encouraged and are expected to contribute to improving contract monitoring overall, the following could also be considered in future plans: Active research into customer satisfaction Metrics for monitoring operator performance Metrics for measuring environmental and sustainability implications of the Council’s home to school transport provision. Support to schools on traffic management
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14 Reporting 5.24 Given the current cost of home to school transport provision, the current arrangements for reporting could be upgraded by considering: More suitable software to fully support management information processes within ASN Transport Improvements in SPT’s formal communication with the Council 5.25 Suitable software within ASN Transport would provide: Improved end to end business processes Better management information Improved contract management 5.26 A revised agreement with SPT should ensure that SPT complies with communication and reporting obligations such as: Standards and response times Frequency of monitoring meetings Key Performance Indicators Budget 5.27 The budget for both mainstream and ASN transport lies within Education, Children and Families. Eligibility for mainstream school transport is determined primarily by distance (currently monitored by Education, Children and Families) and by safe walking routes (determined by Transport and Engineering). Eligibility for ASN transport requires an understanding of individual pupil needs which can include input from a range of educational professionals and schools. 5.28 Give the current criteria and operational experience, having budget for both sit with Education, Children and Families would appear to offer the greatest influence on cost outcome. 6.0 Other Issues Free Travel for Persons Under 22 6.1 New legislation provides for free bus travel within Scotland for people aged under 22 from 31 January 2022. Whilst the Scottish Government has previously intimated that this should not be used as a direct replacement for home to school travel, authorities are factoring this provision into their current “bus pass” options with anecdotal evidence suggesting some pupils prefer the flexibility this offers. 6.2 Legal Notwithstanding the review process, the Council’s position remains that SPT are in breach of their obligations under the agreement between SPT and the Council and that SPT are liable for these failures. Consideration is being given as to the legal remedies available to the Council to recover costs. Such remedies include raising court proceedings for damages. Such action could be taken in tandem with the ongoing review. 6.2.1 The agreement with SPT terminates at the end of March 2023. The Service should carry out an options appraisal as early as possible to identify options to provide mainstream school transport with advice from Procurement, Finance and Legal.
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15 Appendix A High Level Summary Data Eligible Pupils (Mainstream) 8422 Total Mainstream Contracts 219 Eligible Pupils (ASN) 1800 Total ASN Contracts 623 Projected Mainstream Transport Overspend £2.67M Projected ASN Transport Overspend £2.70M Total Projected School Transport Overspend £5.4M Average Temporary to Permanent contract cost increase 41% Pupils transported by internal fleet 895
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16 Appendix B – Minimum Distance for Free Home to School Transport Area Primary Pupils (miles) Secondary Pupils (mile) Statutory Minimum 2 3 Aberdeen City 2 3 Aberdeenshire 2 3 Angus 2 3 Argyll & Bute 2 (under 8) 3 (over 8) 3 Clackmannanshire 1 (under 8) 2 (over 8) 2 Dumfries & Galloway 2 (under 8) 3 (over 8) 3 Dundee City 2 miles for FSM only; otherwise - 3 miles East Ayrshire 1.5 3 East Dunbartonshire 1 3 East Lothian 2 2 East Renfrewshire 2 3 Edinburgh City 2 3 Falkirk 1 (under 8) 2 (over 8) 2 Fife 1 2 Glasgow City 1.2 2.2 Highland 2 (under 8) 3 (over 8) 3 Inverclyde 1 mile FSM 2 miles FSM Midlothian 2 2 Moray 2 2 North Ayrshire 2 3 North Lanarkshire 1 2 Orkney Isles 2 (under 8) 3 (over 8) 3 Perth and Kinross 2 3 Renfrewshire 2 3 Scottish Borders 2 3 Shetland Isles 2 (under 8) 3 (over 8) 3 South Ayrshire 2 3 South Lanarkshire 1 2 Stirling 2 2 West Dunbarton 1 2 Western Islands 2 (under 8) 3 (over 8) 3 West Lothian 2 (under 8) 3 (over 8) 3
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17 Appendix C Deep Dive Risk Analysis Deep Dive Report Risk Title Home to School Transport (Disruption) Owner: Risk Context Section 51 of the Education (Scotland) Act 1980 requires North Lanarkshire Council to make such arrangements as considered necessary for the provision of school transport for pupils attending our schools. Local authorities have a wide level of discretion in this regard, but arrangements take account of factors such as safe walking distance, pupil safety, placing requests, vacant seats, medical conditions, and additional support needs. Unlike many other council’s, North Lanarkshire Council has long-established arrangements to provide school transport beyond the statutory minimum distance requirement. The Council is required to have in place approximately 211 mainstream contracts and 600 ASN contracts for over 10,000 pupils using a mix of buses and taxis. Any such transport arrangements must be safe, of an appropriate quality and ensure that pupils arrive at and are collected from school at appropriate times. These contracts are generally for a period of between 2 - 5 years with a combined cost in 2022/23 of £5.4M. The procurement and ongoing management of mainstream transport provision is carried out by Strathclyde Partnership for Transport (SPT) through long standing formal agreement. SPT have similar agreements with another 11 local authorities across the region. A similar process for ASN transport is managed in-house by Education, Children & Families. On 16 August 2022, the day before the new school term started, SPT advised NLC that 46 transport contracts were unfilled, affecting transport arrangements for some 1,648 pupils. Our current understanding is that this failure was due to a range of factors affecting the market, principally reduced availability of qualified drivers in the market. Although NLC managed to implement a number of contingency arrangements to limit further disruption, there were significant negative impacts as a result, including inflated pricing, significant disruption to pupils and their families/carers, service disruption, increased additional costs and significant reputational damage for NLC. Recent events have demonstrated that the Council is, and will continue to face, significant ongoing challenges around market capacity, contractor behaviour/sustainability and future affordability/best value in delivering its statutory duty to provide home to school transport. Management consider that simply continuing with current arrangements may prove increasingly impractical and/or expose the Council to an unacceptable level of risk and, therefore, it is considered that the Council should examine a range of options which may help mitigate these risks and which will identify a more robust and sustainable way forward, if as seems likely, current pressures continue. Last Assessment Due: Last Assessment Undertaken:
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18 Risk Description That the Council is unable to fulfil its statutory obligation to provide suitable home to school transport to eligible pupils. Due To • SPT failure to appropriately discharge their responsibilities to secure transport contracts on behalf of the Council; • Failure by NLC management to secure contracts for pupils with additional support needs. • Management failure to provide effective contract management/oversight of SPT and/or obtain sufficient assurance on SPT performance/likelihood of failure; • Despite best efforts, SPT and/or NLC management are unable to procure suitable and/or affordable transport provision due to: • Market failure - Shortage of capacity in the market: especially of suitable trained and qualified drivers resulting in inadequate responses to invitations to tender and/or lack of competition; • Market failure - Supplier behaviour: contractors demonstrating an increasing unwillingness to bid and/or compete on price • Substantive contract costs are significantly more than previous costs and may be unaffordable and/or not represent best value • Volume of contracts requiring concurrent renewal may overwhelm capacity of SPT/NLC management and impeded successful co-ordination of procurement/market engagement activities. Impacts • Non-availability of home to school transport potentially affecting c10,000 pupils; • Significant sudden disruption to pupils’ learning associated with varying pick up and drop off times, potentially leading to higher pupil absence rates; • Disruption to school-based staff and management teams in responding to failure; • Significant reputational impacts associated with consequential impacts of disrupted travel arrangements on pupils and families/carers; • Significant financial impacts from additional costs required to implement contingency arrangements including from experience (back filling internal drivers, overtime, F&W agency staff, increase in manning recycling centres etc) in response to diversion of kerbside recyclates as a result of staff redeployment) • Impacts on service delivery for other services i.e., disruption to Fleet & Waste services as a result of temporary staff redeployment; • Increased complaints and enquiries, and associated burden/diversion of resources in managing response and communications; (particularly where parents and schools have no forewarning) Organisation Structure North Lanarkshire Corporate Corporate Priorities • Support all children and young people to realise their full potential
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19 Inherent Assessment A Likelihood - 5 Impact - 5 High - 25 Likelihood Reason Market failure/volatility is likely to remain a longer-term factor in the current economic climate, fewer qualified drivers within the sector together with the Council’s inability to control wider market forces and inflationary pressures/costs means this risk is almost certain to occur as evidenced by recent experience. Continuing restricted supply is likely to maintain pricing risk in tender responses and increasing tender prices. The fact that NLC demands more from the marketplace in terms of a more generous transport offering makes it even more unlikely that the market will be able to meet it. Impact Reason Without any response or contingency measure there will be failure in NLC meeting our statutory obligations, large numbers of pupils and families affected, significant disruption to learning. Significant cost and reputational implications as evidenced by events of the failure in August. Controls and Actions Owner Status Target/Due Date Control - Close monitoring of SPT actions by ECF Transport / Contracts Team with minimum quarterly meetings Underway Control – Shared database reflecting ongoing contract awards during tendering period (Axiom) allows NLC to closely monitor the situation Implemented Control - Detailed information/contract specification on all routes assists contingency and service planning Underway Action – Expand previous detailed analysis/review to RAG routes, to cover all mainstream contract routes and assist prioritisation/actions and resources in response for those contracts most vulnerable to failure or with higher impacts if they do fail. This will also inform future options appraisal activity. Agreed this will be done by applying the following RAG criteria to the detailed spreadsheets held on all mainstream contract routes with each given equal weighting at the first stage of the analysis. This is because there are assumptions that require to be made on a reasonable basis regarding driver/contractor behaviour based on previous experience and price, which is hard to predict or place enough reliance upon to assign greater weighting: Underway
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20 1. Price - group agreed that those contractors who have had a higher uplift in what they are being paid may be less likely to hand back contracts than those who have had a lower uplift. Assigned scale as (1) - Above 50% uplift, (2) 0-50% uplift and (3) below 0% uplift 2. Contractor reliability - group agreed that those contractors who have handed back contractors before may be more likely to repeat this behaviour. Assigned scale as (1) Never handed back a contract, (2) Handed back a contract in August and (3) has handed back contracts prior to August issues. 3. Pupil Impact - group agreed that those routes involving significant numbers of children will have greater impact and be more complex to implement contingencies for than those involving lower numbers of pupils. Assigned scale as (1) <50 pupils, (2) 50-100 pupils and (3) >100 pupils Action – Similarly undertake detailed analysis of ASN contracts and assist prioritisation/actions and resources in response for those contracts most vulnerable to failure or with higher impacts if they do fail. Planned Action - Prepare and document business continuity plans for the service including disruption to school transport arrangements on a range of scenarios informed by the detailed route RAG analysis on an ongoing basis. These will include actions already implemented on previous occasions such as: - Understanding where it is possible to increase internal supply in the short term - Expansion of U22 bus travel (link with YS travelcard Team) - Use of Service routes - NLC Fleet drivers moved over to school transport using Fleet vehicles - Double route runs - Parental expenses arrangement for transporting own children Communications Strategy/arrangements which form an important element of Business Continuity arrangements to proactively manage comms prior to an event and provide managed response in the event of a failure event which will limit negative impact on resources. Underway Control – Service Business Continuity Plans Planned
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21 Control - Established procurement framework allows for quick turnaround of substantive contract recommendations where necessary. Implemented Proposed Action - Carry out options appraisal exercise (informed by lessons learned from reviews into previous failure events) to explore more affordable and sustainable options for future provision of school transport including but not limited to: • Reducing demand by moving to statutory minimum distance requirement. • Increase supply (internally) by procuring busses and recruiting drivers • Expansion of parental expenses scheme (currently offered to ASN) • Maximum use of Service buses (bearing in mind different safety conditions) • Align with promotion and uptake of Young Scot travel card for free travel Planned Residual Assessment Likelihood – 4 Impact - 5 High - 20 Likelihood Reason Close monitoring/improved contract management arrangements will provide earlier warning of the risk potentially crystallising but will not reduce the chances of it happening. As the UK enters what is expected to be a period of recession, ongoing market volatility combined with inflationary pressures and the higher level of demand from NLC mean the likelihood of occurrence remains very high. Impact Reason Many of the mitigations are aimed at responding to the risk if it materialises, ensuring that we are better prepared in terms of service Business Continuity arrangements however these are still to be formally developed and approved. There are still likely to be significant impacts if the risk occurs despite any contingencies we can put in place considering the potential scale of failure across 800 contracts both in terms of affordability and sustainability of the provision.
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22 Appendix 2 North Lanarkshire Council (NLC) & Strathclyde Partnership for Transport (SPT) Preliminary Joint Review of Home to School Transport December 2022 Contents 1.0 Introduction 2.0 Context 3.0 Scope 4.0 Methodology 5.0 Initial analysis and findings 6.0 Conclusion and summary of actions
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23 1.0 Introduction 1.1 On 29 September 2022, following reports of significant difficulties and disruption within the current transport market, Policy and Strategy Committee authorised a joint review of Mainstream Home to School Transport Provision for North Lanarkshire Council (NLC) with Strathclyde Partnership for Transport (SPT). A similar decision was taken by SPT’s Operational Committee on 26 August 2022. 1.2 The purpose of the joint review is to maintain a common understanding between both parties of progress against the shared objective of providing an efficient and effective Mainstream Home to School transport service. Also, to determine what should be done to help ensure the continuous improvement of that service. The scope of this joint review does not include Additional Support Needs (ASN) transport managed directly by NLC. 1.3 This preliminary report presents the outcomes of that review and suggested areas of improvement. These outcomes should ensure that activities are evaluated on an ongoing basis; that review results are shared; that actions are tracked to closure and that problems and risks are identified early and managed accordingly. 1.4 Further updates on these outcomes will be reported in due course. 2.0 Context 2.1 Section 51 of the Education (Scotland) Act 1980 requires local authorities to make such arrangements as they consider necessary for the provision of school transport for pupils attending schools in their area. Local authorities have a wide level of discretion in this regard, but arrangements will take account of factors such as safe walking distance, pupil safety, placing requests, vacant seats, medical conditions, and additional support needs. 2.2 The Act stipulates that provision must be made for pupils under 8 years old who would have a walking distance to school of over two miles and for other pupils whose walking distance would be over three miles. 2.3 NLC has a long-standing Agency Agreement with SPT, who manage, monitor and maintain mainstream home to school transport arrangements on behalf of the council. NLC requires over 200 contracts for the 2022/23 school term to meet existing demand by eligible school pupils. 2.4 On 16 August 2022, SPT reported that, due to strain on the marketplace, 46 transport contracts could not be secured for over 1,600 pupils starting North Lanarkshire schools the next day as the operators to be awarded the relevant contracts had, at short notice, withdrawn their offers to fulfil them. As context, a further 153 contracts were successfully awarded for over 7,100 pupils in North Lanarkshire, operating as normal. 2.5 In response, an NLC Emergency Planning Team (School Transport) was established to ensure that contingency offerings could be agreed and put in place. Similarly, SPT mobilised their Business Recovery Team to assist NLC in addressing the challenges faced. These required some changes to existing provision and practice. This included both NLC and SPT staff being redeployed to operate a number of services directly. These services included double running, where pupils’ pick up and drop off times were amended to accommodate demand, as necessary. To support this, activity, and with the agreement of NLC, SPT arranged a lease of 10 coaches from Parks of Hamilton on behalf of the council. The lease period runs until the end of June 2023.
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24 2.7 This matter has been reported to Council. Similarly, SPT have reported this matter to their Partnership board. Preliminary internal reviews have also been carried out by both NLC and SPT. 3.0 Review Scope 3.1 Both NLC and SPT understand that a joint review and subsequent joint working is required to: a) Recognise the current state of the wider home to school transport market b) Identify risks specific to home to school transport in North Lanarkshire including market structure, predicted costs and contractor behaviours c) Identify possible mitigation measures to address risks specific to home to school transport in North Lanarkshire d) Identify possible improvements for communication channels between NLC, SPT and transport operators e) Identify possible joint working in relation to specification of needs, procurement and contract approval, and compliance with Agency Agreement 3.2 Specific areas addressed include: • Process for contract renewal in session 2023/2024 • Communication framework and agreed review points • Risk management analysis 4.0 Methodology 4.1 The review examined existing practice in detail with input from officers in both NLC and SPT. The review has been informed in large part by the daily operational meetings held between both organisations since 17 August 2022. The review also takes account of preliminary recommendations from both internal reviews, ongoing risk analysis and industry intelligence. 5.0 Initial Analysis and Findings 5.1 State of the current transport market As background, there are currently 63 contractors delivering Mainstream Home to School in North Lanarkshire. The breakdown of these suppliers can be summarised as 29 bus and coach operators and 34 taxi and minibus operators. Feedback suggests that home to school transport suppliers in North Lanarkshire, including bus, coach, taxi and minibus operators, are facing a number of ongoing structural challenges. A UK wide industry shortage of drivers and other support staff is a significant ongoing concern impacting on service delivery. For example, as reported by the BBC, 1 in 10 bus driving vacancies remain unfulfilled, with Scotland the facing the biggest shortfall in the UK (https://www.bbc.co.uk/news/uk-england-63489705). Given the strength of the Distribution and Haulage sectors in North Lanarkshire, this may further compound the local situation, with many drivers moving to more lucrative and flexible employment in these sectors. In addition to the above, the Home to School transport market has been impacted by the lasting impacts of the Covid 19 pandemic and significant inflationary pressures including those relating to wages, fuel, parts and maintenance. Resultingly, recent tender returns for some Home to School Transport contracts have overall been significantly higher than the general rate of inflation. There have also been fewer bids
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25 for some tenders, reflecting worsening market conditions. This situation appears to be more pronounced in Lanarkshire than in other areas of Strathclyde, though the underlying issues are similar. 5.2 Key risks to the provision of home to school transport in North Lanarkshire The current market conditions stated above have resulted in restricted supply, reduced competition and significantly increased overall costs to NLC for Mainstream Home to School Transport provision. Additionally, a potential increase in demand for school transport is possible due to local population growth and rationalisation of the school estate. Furthermore, there has been an increase in poor supplier behaviour around contract management with significant numbers handing contracts back at short notice. Notwithstanding the above, risks to the ongoing viability of a number of local suppliers remains a further concern. These issues combine to create a larger risk of failing to provide sufficient home to school transport and the subsequent risk to the reputation of NLC. 5.3 Mitigating risks to the provision of home to school transport in North Lanarkshire NLC will continue to manage this risk via the risk management strategy and ongoing risk analysis. This joint review suggests several similar and additional possible mitigations for consideration under this process: • Consider support for driver training and recruitment (particularly PCV) • Review the current home to school transport eligibility criteria • Maximise the use of U22 Concessionary Travel Scheme / Local Bus Services • Potential scoping/grouping of contracts to encourage greater uptake • Additional local engagement with operators to encourage participation in tendering exercises and to discourage poor behaviour • Review NLCs additional supplier requirements e.g. 6 monthly MOTs • Increase existing finance to offset inflationary pressures on suppliers • Increase internal capacity 5.4 Communication between NLC and SPT There is agreement that the increased risk and complex dynamics now present in the provision of home to school transport require more proactive and frequent communication between NLC and SPT. Given the risks identified, both NLC and SPT will endeavour to ensure that shared data is provided timeously, is updated regularly, and that achievement of key milestones is regularly monitored and reported. Crucially, this will provide necessary escalation points and ensure early warning of significant issues including those in relation to procurement. It is agreed that project plan methodology will be adopted. 5.5 Future Joint Working Formal joint working between NLC and SPT is captured within an Agency Agreement. This is due for renewal in April 2023. Discussions on revised content are underway and it is expected that these will take account of recent events.
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26 Beyond this, operational joint working will continue with priority given to forthcoming contract renewals at the time of writing (and based on current eligibility criteria): 2023 – 140 renewals 2024 – 31 renewals 2025 – 24 Renewals 2026 – 16 Renewals 2027 – 20 Renewals This work will take account of the finding of this review, individual reviews and ongoing improvement initiatives. 6.0 Conclusion and Summary of Actions 6.1 Recent events demonstrate that the provision of Mainstream Home to School to transport has become increasingly complex and uncertain. Difficult and widespread market conditions have restricted supply and placed a significant financial burden on local authorities nationwide. There is little to suggest that this is a short-term issue but rather one that will require continuous monitoring, dynamic risk assessment and changes to policy and practice as we move forward. The issues identified in Lanarkshire appear to be more pronounced than other council areas in the West of Scotland. This joint review presents several initial recommendations but recognises that further work will be required over a longer period to ensure that such risks can be mitigated and controlled as far as reasonably practicable. 6.2 Summary of initial recommendations • Review contractor engagement including vehicle requirements and contract scoping • Reduce demand via eligibility criteria and maximising national initiatives such as the Under 22 free travel initiative • Increase opportunities for driver training within the local workforce • Increase internal supply of PCV qualified drivers. • Refresh joint communications and shared aims via project planning methodology • Review formal Agency Agreement between NLC and SPT • Agree further joint working and reporting on emerging issues North Lanarkshire Council (Education, Children and Families) Strathclyde Partnership for Transport December 2022
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27 Appendix 3 Extract from minutes of Policy and Strategy Committee 29 September 2022
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28 Appendix 4 Summary of Review Recommendations Preliminary Internal Review of Home to School Transport by North Lanarkshire Council 1. Ensure that all eligible pupils are aware of, and have access to, the Scottish Government Young Persons’ (Under 22) Free Bus Travel Scheme 2. Develop a clear and comprehensive revised school transport policy 3. Consider cost reduction options via a decrease in free school transport qualifying distance; and/or increase in existing budget provision via budget setting process to take account of current external transport market conditions and pressures 4. Optimise current in-house transport provision to further enhance future resilience and contingency response. 5. Other areas for consideration: a) Investigate options to provide enhanced allowance or travel expenses to parents providing ASN transport b) Further evaluate existing conditions of contract and contract monitoring arrangements for school transport c) Assess the environmental and sustainability implications of the Council’s home to school transport provision d) Develop stakeholder engagement / customer satisfaction process for school transport e) Explore targeted revenue investment to create Active Travel Teams to support schools, parents and pupils in advocating independent travel and promoting safe and sustainable alternative travel options. f) Increase digitisation by introducing Geographic Information System (GIS) software to determine distance eligibility for mainstream transport as accurately as possible and ensure consistency in measurement g) Increase digitisation by introducing a bespoke management information system for Additional Support Needs (ASN) Transport Preliminary Joint Review of Home to School Transport by NLC and SPT 6. Preliminary recommendations from joint review with SPT: a) Review contractor engagement including vehicle requirements and contract scoping b) Reduce demand via eligibility criteria and maximising national initiatives such as the Under 22 free travel initiative c) Consider opportunities for driver training within the local workforce d) Consider internal supply of PCV qualified drivers. e) Refresh joint communications and shared aims via project planning methodology f) Review formal Agency Agreement between NLC and SPT g) Agree further joint working and reporting on emerging issues