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082/2013: North Yorkshire Police Employees’ Benefits Scheme – 10 December 2013

Executive Summary and recommendation:

This Scheme is to provide a voluntary benefits website, provided in a partnership arrangement with North Yorkshire County Council (NYCC), to include local and national offers, salary sacrifice offers and Scheme management. Five Lots are proposed as follows:

Lot 1 – Provision of Voluntary Benefits System

This Lot includes the provision of an IT System and website that will enable the delivery of the schemes listed in Lot 2 – Lot 5 (inclusive) as well as a voluntary benefits website. The provider will specifically design this website for each partner and it will include, as a minimum, single sign on to national and local offers, salary sacrifice schemes (including access to the provision of future salary sacrifice offerings) and project management of communications. In addition, the provider will provide, as a minimum, an annual promotion and targeted communication to employees. The ability to incorporate any new salary sacrifice offerings within Lot 1 during the period of the Agreement is vital.

Lot 2 – Provision of a Childcare Salary Sacrifice

Includes the following as a minimum; an online application provision enabling staff to order online vouchers, deductible under salary sacrifice rules and payable to a registered childcare provider on a monthly basis. This scheme must operate in conjunction with Lot 1 above.

Lot 3 – Provision of Green Car Salary Sacrifice

Enables staff to undertake a personal/private lease of a new low emission car (sub 120mcg CO2) of their choice, fully maintained and insured, resulting in a gross monthly salary deduction and making savings in tax, national insurance and pension for each employee as well as savings on national insurance for the employer. The scheme will also incorporate gap and early termination insurance, road taxation, roadside recovery, accident management and maintenance and an annual driver licence checking facility. This scheme must operate in conjunction with Lot 1 above.

Lot 4 – Provision of Cycle to Work Salary Sacrifice

This scheme will include the following; an online application provision to provide employees with the ability to order a new bike and accessories from local and national providers via a voucher payable in advance by the employer, deductible under salary sacrifice rules. This scheme must operate in conjunction with Lot 1 above.

Lot 5 – Provision of Employee Computer Salary Sacrifice

This scheme will include the following; an online application for employees to order a new home computer (Laptop, desktop or tablet), resulting in a gross monthly salary deduction and making savings on tax and national insurance for each employee as well as savings on national insurance for the employer. The scheme must operate in conjunction with Lot 1 above.

The establishment and running of this Scheme requires a full understanding of its mechanics and their implications for NYP, both staff and organisation. Input into the legal, information security, financial and administrative aspects will precede adoption and provide guidance as to the roll out of the various Lots. This is particularly important for the salary sacrifice schemes. In view of these considerations it is recommended that NYP takes an incremental approach to adopting the Scheme.

The Executive Board is asked to agree to adopt the NYCC scheme on the basis that:

  • The charges of circa £3,741 to access the framework and Lots’ platform are approved in principle
  • Notification to staff of the Employees’ Benefits Scheme is made in December.
  • Initially Lot 1 will be open to permanent employees and volunteers. Others, such as staff employed through contractors and retirees, will be considered at a later point.
  • Permanent employees who meet specified criteria will be eligible for those Lots requiring salary sacrifice arrangements.
  • Staff will take responsibility for the financial implications of their choosing to take up the salary sacrifice schemes.
  • Further work is done in-house to confirm and manage initial implications of the details of the Scheme. Further Lots are adopted when the full details are understood, particularly those relating to anticipated legal changes to pensions and child care arrangements, and management arrangements are in place.
  • A staged approach is agreed, commencing with the launch of Lot 1 in February 2014.
  • The launch of Lots will coincide with notable NYP events.
  • A further report provides the detailed costs and possible savings as well as an integrated roll-out plan.

Police and Crime Commissioner decision:

Police and Crime Commissioner decision: Subject to contract and due diligence, sign up to the Scheme is approved. Lot 1 to be progressed and subsequent lots to be discussed at the Executive Board for implications and communications strategies prior to their roll out.

Signature Date 10 December 2013
Title Police & Crime Commissioner for North Yorkshire
jm-signature

Part 1 – Unrestricted facts and advice to the PCC

    1. Introduction and background
      1. On 15 October 2013 the Executive approved recommendations that North Yorkshire Police (NYP) offers a benefits package to staff and that this is provided in partnership with NYCC.
      2. NYCC has had their “Everybody Benefits” scheme in place since 2007 thus has a good measure of experience in the management of such an initiative. The estimated annual spend of the Scheme is currently around £4.7m and has 14 other organisations linked in via service level agreements to access benefits. The Council is completing a benefits scheme re-tendering process with a view to securing a provider and awarding the contract to deliver the Lots, as set out in the Executive Summary, by the end of December. An agreed “go live” date also needs to be agreed that allows sufficient time for contract finalisation and Scheme administration processes to be established.
    2. Matters for consideration
      1. Agreeing and implementing the Scheme will require:
        • Agreeing the terms and conditions and NYP’s and the providers’ responsibilities.
        • Ensuring that NYP has made provision for the running and review of the Scheme. This will include identifying resources to deal with legal, financial and Scheme management matters and establishing a communications plan.
        • In view of the point above, NYP begins with the launch of Lot 1 as this will offer considerable benefits immediately whilst NYP works through the implications of the remaining Lots.
        • Whilst wishing to have as broad a customer base as possible, ensuring that the Scheme is offered to those who meet the various legal and financial criteria.
    3. Other options considered, if any
      1. NYP could maintain the current levels of benefits and review procurement arrangements to do so. This is modest, centred around just childcare and eye care, welfare accommodation, Occupational Health with additional benefits available from Unison and Police Federation membership. It does not offer the comprehensive benefits available through the proposed partnership with NYCC and does not support NYP’s drive to assist staff.
      2. Particular arrangements could be made for each facet of an overall scheme. This is burdensome and unlikely to provide the widest and best scheme to staff.
      3. NYP considers options from other consortia.
      4. NYP enters into a partnership to join an established scheme that offers a wide range of benefits on a voluntary and flexible basis. This is the recommended option agreed by the Executive on 15 October 2013.
    4. Contribution to Police and Crime Plan outcomes

This scheme contributes to organisational goals at different levels but specifically:

      • Goal 3: More With Less – take up of the salary sacrifice schemes will reduce the staff and NYP tax and National Insurance obligations so creating savings as staff benefit.
      • Goal 4: Fit for the future – embedding “people first” culture amongst the whole workforce by providing a comprehensive, voluntary benefits scheme. Similarly there will be clear criteria to meet for staff wishing to join salary sacrifice schemes which will protect both them and the organisation.
      • Reduced carbon footprint by offering Lot 3 (Green Car) and Lot 4 (Provision of Cycle).
      • Also to Police and Crime Plan Delivery Board objectives under the People Work-stream to: Deliver a Leadership, Engagement, Wellbeing and Culture Change Programme.
      • Finally the Scheme offers staff the opportunity to make cost-effective purchases from local retailers thus support the local economy.
    1. Consultations carried out

A first discussion paper was presented and agreed by the Executive Board on 15 October and consultation has already begun with each of the staff associations. Discussions have also been conducted with Finance and Legal Services colleagues, who have further opportunity to comment on this paper. Lengthy consultations have also been conducted with NYCC.

  1. Financial Implications/Value for money
      1. The annual Access Fees for the contracting authority (with 1001-5000 employees) to pay to NYCC for access to the framework are understood to be £1,275.00. An additional charge of 0.95p will be raised for each member of staff to register on the platform (so 2596 staff x 0.95p = £2,466). Total annual costs will therefore be in the region of £3,741.
      2. This total would be subject to alteration according to the take up rate and should NYP seek support from NYCC for Scheme management. In addition there will be costs attached to setting up and administering the Scheme. A further report will confirm funding arrangements.
      3. It is recommended that, with regard to the salary sacrifice schemes:

    NYP takes steps to help ensure that staff understand fully the financial implications of the scheme on their tax liability and pension contributions
    NYP confirms that both the employer and employee will continue to make pension contributions based on the gross salary (ie before the salary sacrifice is deducted) thereby ensuring that the salary sacrifice scheme does not impact on pension benefits for the employee. NYP does not seek to make any savings in pension contribution as a result of anyone joining a salary sacrifice scheme.

      1. Savings from the salary sacrifice savings may be used to off-set the annual cost of the Employee Benefits platform. As staff make payments from their gross salary, this reduces their (and NYP’s) tax and National Insurance liability. The amount recouped in savings for NYP will depend upon uptake of the salary sacrifice schemes and so a clearly understood, dynamic launch of the overall Scheme and regular communications refresh will be important to maintaining and building levels of Scheme utilisation. Conversely tax savings need to be considered alongside potential loss of earnings from investment.
      2. Whilst NYP provides interest free loans as funding for salary sacrifice schemes, safeguards around particular circumstances, such as staff leaving before the end of the agreement, are built in so that all monies are recovered through employees’ salaries during the contract period.
      3. In autumn 2015 HM Government’s changes to supporting working parents come into effect. It is expected that more families could access childcare vouchers and enjoy higher savings, receiving central funding for up to 20% of their childcare costs. Similarly changes to pension arrangements are also anticipated. NYP needs to understand the implications of any new legislation and build those into the timing of adoption of salary sacrifice Lots.
      4. Chief Constables Chief Finance Officer Comments:

    No provision has been made in the budget for any financial implications of this scheme. In particular no provision has been made for any additional staffing resources that may be needed in payroll and or HR in order to administer the scheme. It is anticipated, however, that the savings on employers NI costs will cover the costs of this additional administration resource.

    1. Legal Implications
      1. NYCC has undertaken Scheme procurement through an Official Journal of the European Union restricted tender for a framework agreement that is open to all public sector organisations in the United Kingdom. Currently 14 other organisations have a service level agreement with NYCC for their employees to access services via the Council’s “Everybody Benefits” scheme that forms part of their Pay and Reward policy framework.
  2. Equality Implications
    1. NYP wishes to offer the Scheme as widely as possible. A better understanding of the detailed implications is required however and thus the Lots will be rolled out in a managed and informed way.
    2. Offers are to be available in various formats so as to include staff with disabilities. For example the Green Car Scheme is available to staff who may not be able to drive themselves but can apply for a car for their carer to drive them.
    3. Whilst the HMRC eligibility criteria have to be met, this does not preclude staff from making applications.
    4. NYCC has specified that the successful provider must deliver an annual, and on-going ad hoc, promotions in media specific to customer requirements for all staff. This will take account of staff working in remote locations and/or without ready access to personal computers at work. NYP needs to ascertain whether this is applicable just to NYCC or all partners.

Public Access to Information

The Police and Crime Commissioner wishes to be as open and transparent as possible about the decisions he/she takes or are taken in his/her name. All decisions taken by the Commissioner will be subject to the Freedom of Information Act 2000 (FOIA).

As a general principle, the Commissioner expects to be able to publish all decisions taken and all matters taken into account and all advice received when reaching the decision. Part 1 of this Notice will detail all information which the Commissioner will disclose into the public domain. The decision and information in Part 1 will be made available on the NYPCC web site within 2 working days of approval.

Only where material is properly classified as restricted under the GPMS or if that material falls within the description at 2(2) of The Elected Local Policing Bodies (Specified Information) Order 2011 will the Commissioner not disclose decisions and/or information provided to enable that decision to be made. In these instances, Part 2 of the Form will be used to detail those matters considered to be restricted. Information in Part 2 will not be published.

Is there a Part 2 to this notice – NO
Originating Officer Declaration – Author name: Claire Craven-Griffiths Collar number: 004529

Tick to confirm statement √
Director/Chief Officer has reviewed the request and is satisfied that it is correct and consistent with the NYPCC’s plans and priorities. 1414A/ACC Ken McIntosh 20.11.2013
Legal Advice Legal advice has been sought on this proposal and is considered not to expose the PCC to risk of legal challenge.
Financial Advice The CC CFO has both been consulted on this proposal, for which budgetary provision already exists or is to be made in accordance with Part 1 or Part 2 of this Notice Jane Palmer 004364 05.12.13
Equalities Advice An assessment has been made of the equality impact of this proposal. Either there is considered to be minimal impact or the impact is outlined in Part1 or Part2 of this Notice. Claire Craven-Griffiths 004529 20.11.13
I confirm that all the above advice has been sought and received and I am satisfied that this is an appropriate request to be submitted for a decision Claire Craven-Griffiths Date 20.11.2013
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