Tower Hamlets Council to launch £12m mechanical maintenance contract

Tower Hamlets Council is set to launch a new £12 million contract for mechanical maintenance services across its corporate and operational estate, aligning with the Council's strategic priority of 'Investing in public services'.

The Cabinet has approved the commencement of a competitive procurement process for a new Mechanical Measured Term Contract (MTC). This contract will cover planned and reactive mechanical maintenance, statutory compliance checks and inspections, and a reactive breakdown service. Typical activities will include the servicing and maintenance of gas boilers, hot and cold water systems, heating and cooling systems, and air conditioning plant. The contract is expected to run for an initial two-year period, with the option to extend for up to two further years in one-year increments.

Grant-process support survey response categories
Bar chart showing principal survey response categories for grant-process support.Source: Cabinet papers, 21 October 2026

This move is crucial to ensure the continuity of essential mechanical maintenance services across the council's diverse estate, which includes leisure centres, administrative sites, and public buildings. The existing contract is due to expire in April 2027, necessitating the timely initiation of a new procurement process to avoid any disruption to services. The estimated maximum value of the MTC is £12 million over the full potential contract term, with an annual expenditure up to £3 million per year.

The procurement will adhere to the Procurement Act 2023 and the Council's Contract Procedure Rules. A significant element of the tender evaluation will focus on social value and community benefits, which will carry a 10% weighting. The specific requirements for social value will be developed during the tender pack preparation and will include encouraging and measuring the use of the local supply chain through KPIs and targets, as well as seeking commitment to local projects and supporting Council-led schemes such as work experience and placement opportunities.

Councillor Abu Talha Chowdhury, Cabinet Member for Finance, Assets and Governance, highlighted the importance of this contract in maintaining safe and efficient buildings for residents and staff. The estimated value of £12 million over the potential four-year term reflects the anticipated scope of works, including services for the leisure estate and Town Hall, as well as provision for small capital works and emergency repairs.

The council aims to test the market through this competitive process to secure value for money and ensure the future contract aligns with current operational needs and strategic priorities. Preliminary market engagement will be conducted to gather feedback on the proposed contract model and procurement approach.

Projected Timeline:

The projected timeline for the MTC procurement is as follows:

  • Cabinet approval: October 2026
  • Market Engagement Sessions held: October 2026
  • Procurement documents finalised: November 2026
  • Pre-qualification Questionnaire (P2SQ) and Invitation to Tender (ITT) issued: November 2026
  • Tender submissions due: January 2027
  • Evaluation and moderation: January/February 2027
  • Contract Award: March 2027
  • Mobilisation: April/May 2027

Key Risks and Mitigation:

The key risks identified for this procurement include service continuity, the procurement process itself, contract management, and financial risks. To mitigate the risk of service continuity, the council is commencing procurement now to allow sufficient time for a compliant process and service continuity. Preliminary market engagement is being used to address risks associated with the procurement process and market capacity. A single-provider model is favoured for contract management to ensure better accountability and consistent standards, mitigating risks of fragmented responsibility. Financial risks are being managed through careful monitoring of contract expenditure, commitments, variations, and performance to ensure value for money within available resources. Expenditure will be funded from revenue and capital budgets, subject to approval.

This initiative is detailed further in the Public reports pack 21st-Oct-2026 15.00 Cabinet.pdf.