DD1507 TfL posting costs, 1 April 2016 - 31 March 2017

1.1 The GLA runs marketing communications campaigns to help ensure Londoners are aware of the work of the Mayor of London, London Assembly and City Hall so that they are able to access the associated benefits. Examples of campaigns include Team London, so Londoners know how to access volunteering opportunities via the Team London website and Gigs, so young Londoners can enter the Mayor’s annual busking competition and Londoners can vote for their favourites.

1.2 In order to assist the GLA in running cost-effective marketing communications campaigns, TfL provides the GLA with a package of value-in-kind inventory/media space, which comprises posters on the London Underground, print advertising in the Metro newspaper, digital advertising on TfL’s Journey Planner, leaflets in London Underground stations, bus shelter posters, external advertising on buses (bus wraps and mega rears) and carriage cards on the DLR. The GLA receives a very small proportion of TfL’s media inventory, most of which is sold commercially. Use of the inventory ensures GLA marketing campaigns are cost-effective and helps the GLA inform Londoners about City Hall’s work so they can access the benefits. Images of the Mayor and London Assembly only usually feature on the advertising for the annual State of London debate and twice-yearly People’s Question Time events, where Londoners can ask the Mayor / London Assembly questions in person.

1.3 This advertising space is extremely valuable to the GLA and reaches many Londoners. The GLA is only required to pay Transport Trading Limited the following posting costs for the bus shelter posters, external advertising on buses (bus wraps and mega rears) and leaflets, as the advertising space itself is provided free of charge:

Posting costs:
• Bus shelter posters - £7,000 per posting (x4) (£28,000 per year)
• Bus wraps - £9,000 per posting (x5) (£45,000 per year)
• Bus mega rears - £1,600 per posting (x5) (£8,000 per year)
• Leaflets - £470 per posting (x15) (£7,050 per year)
• Total cost to GLA: £88,050

1.4 £88,050 will be paid to Transport Trading Limited in 2016-17 initially from the Marketing Team budget. These costs will be reimbursed to the Marketing Team by each project team that utilises the TfL inventory.

1.5 Officers acknowledge that under section 4.1 of the GLA’s Contracts and Funding Code (the Code) contracts for services between £10,000 and £150,000 should be procured by seeking a call-off from a suitable framework where possible, or undertaking a formal tender process. However, section 5 of the Code also provides that an exemption from this requirement may be approved where there is a complete absence of competition. The media value of the leaflets, bus shelter posters and external advertising on buses is considerably higher than the production costs, when compared to buying the same services through a media agency for each posting. For example, the bus shelter posters reach 74% of Londoners. Therefore we are delivering considerable value for money and reaching a greater percentage of Londoners through using TfL’s media space inventory and paying only the posting costs.

1.6 Here, as TfL owns the media space inventory and works directly with their “posting” supplier, Transport Trading Limited is the only supplier able to provide the services in question.

1.7 Accordingly, an exemption from the requirements of section 4.1 of the Code is sought under this DD.

2.1 The objective is to enable the GLA to utilise the value-in-kind inventory/media space from TfL to complement its marketing campaigns. For 2016-17 the costs totalling £88,050 will be paid via the 2016-17 Marketing Team budget, and later reimbursed by policy/events budgets, to ensure payment to Transport Trading Limited is swift and efficient.

3.1 The construction of all GLA marketing campaigns take into consideration the audience for which the campaign is aimed at. In every case, materials are assessed to ensure they are fully accessible and in line with the public sector equality duty.

a) Key risks and issues

4.1 The risk of not organising payment in this way is reduced efficiency as the GLA would be required to raise separate purchase orders for every project, which is time consuming and not a good use of resource.

b) Links to Mayoral strategies and priorities

4.2 Resources’ objectives in the GLA business plan 2015-17 include:
- deliver value for money and provide for effective corporate services

4.3 This financial arrangement will ensure resources are used efficiently and the GLA demonstrates value for money for Londoners.

c) Impact assessments and consultations

4.4 This arrangement worked well in 2015/16 for the GLA policy teams so will be replicated again in 2016/17.

5.1 The GLA’s expenditure of up to £88,050 towards posting and distribution costs of the Transport for London inventory and media space in 2016-17 will be contained within the Authority’s revenue budget for 2016-17. These costs will initially be accounted for within the Marketing Teams budget (External Affairs Directorate) and costs will then be recharged out to individual Directorates who utilise these services on a call off basis.

5.2 Each project for which these services are to be utilised will be subject to the Authority’s decision-making process. All appropriate budget adjustments will be made.

6.1 Sections 1 to 4 of this report indicate that:

6.1.1 the decision requested of the assistant director, in accordance with the GLA’s Contracts and Funding Code (the Code), falls within the GLA’s statutory powers to do such things considered to further or which are facilitative of, conducive or incidental to the discharge of its general functions; and

6.1.2 in formulating the proposals in respect of which a decision is sought officers have complied with the GLA’s related statutory duties to:

• pay due regard to the principle that there should be equality of opportunity for all people;

• consider how the proposals will promote the improvement of health of persons, health inequalities between persons and to contribute towards the achievement of sustainable development in the United Kingdom; and

• consult with appropriate bodies.

6.2 Section 4 of the Code requires the GLA to undertaking a formal tender process in respect of the services required or call-off the services required from an accessible framework. However, the director may approve an exemption from this requirement under section 5 of the Code upon certain specified grounds. One of those grounds is a complete absence of competition. Officers have indicated in section 1 of this report that this ground applies, and that the proposed contract affords value for money.

On this basis the director may approve the proposed exemption if satisfied with the content of this report.