Disposal of Various Items of Property/Surplus Assets by Public Auction

Reference code: 
PCD 208
Date signed: 
01 June 2017
Authorisation name: 
Sophie Linden, Deputy Mayor, Policing and Crime

Executive summary

This paper seeks approval to initiate the procurement for the Disposal of Various Items of Property/Surplus Assets by Public Auction. The contract will be for a period of two years with the option to extend for a further two years.

Recommendation

The Deputy Mayor for Policing and Crime is asked to approve the initiation of a procurement tender for a Disposal of Various Items of Property/ Surplus Assets by Public Auction contract. The initial contract length will be for a period of two years, with the option to extend for a further two years.

Non-confidential facts and advice to the Deputy Mayor for Policing and Crime (DMPC)

1.    Introduction and background

1.1.    The MPS has a requirement to dispose of various items of property and surplus assets through sale at public auction. The Criminal Exhibits Services team receive and store a wide range of items obtained as a direct result of criminal investigations including items seized under the Proceeds of Crime Act (POCA), property found in the street or surplus equipment and office machinery in need of disposal. These items are subsequently split into lots and sold at auction. 

1.2    The contract will consist of four lots:
•    Lot 1 – Jewellery, fine art, antiques and memorabilia (excluding POCA)
•    Lot 2 – Property found in the street and MOPAC/MPS surplus assets
•    Lot 3 – Crime related property (excluding POCA)
•    Lot 4 – Crime related property and initial and on-going valuations (Proceeds of Crime Act)

2.    Issues for consideration

2.1.    The MPS had previously carried out a procurement exercise for this service, however there was a challenge by one of the unsuccessful bidders regarding the procurement process and the award of the contract was halted. The MPS sought external legal advice and was advised to terminate the tender and carry out a new procurement.

2.2.    The MPS will be seeking separate approval to extend the services of their incumbent suppliers for up to 12 months to maintain the service until this tender has concluded. 

3.    Financial Comments

3.1.    The cost to the MPS will be nil or minimal value as sales commission is charged to the winning bidder at the auction. The auction sales for lots 1-3 could generate income of £0.4m per annum, net of any commission charged by the auction house. Based on market prices it is expected that bidders for this contract will propose commission charges for buyers of between 10% - 15%. Based on historic sales information for lots 1-3 it is expected that they will generate potential sales commission in excess of £250,000 over the four year period. The commission is payable by the winning bidder at the auction. 

3.2.    It is estimated that monies received from items auctioned under Lot 4 will be £0.3m based on 2016 figures. The MPS will manage this income in accordance with the Proceeds of Crime Act 2002. 

3.3.    All income figures are estimates, as sales can fluctuate as they are dependent on the volumes of property found or seized over the year. As this is contract is a framework agreement there is no guarantee on volume or income.

4.    Legal Comments

4.1.    There are no legal implications arising from this report.

5.    Equality Comments

5.1.    There are no direct equality or diversity implications arising from this report

6.    Background/supporting papers

6.1.    Report.
 


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