Previous Derby News articles have raised questions about Nottingham Specialist Transport (NST), the company which won the Derby City Council contract for transporting 400 Special Needs children from Home to School.

Would you put your vulnerable child into an unmarked minibus? Derby City Council expects you to!

Derby City Council’s Home to School Transport contract – independent audit needed.

NST has recently published its accounts for the year to 30 June 2023 which highlights further questions and concerns about the company.

NST was incorporated on 11 June 2020 and was dormant for the first few years. It published its first set of accounts on 27 March 2023 ( for the year ending 30 June 2022), the day after it submitted its bid for the Home to School Transport contract.

Those accounts showed that it had just 1 employee and £93k (book value) of motor vehicles. The average cost of a minibus is in the range of £10-£20k – so the total fleet, owned, would be around a maximum of 10.

In the response to the question, in the Derby City Council Contract tender document:

“Do you currently have the required vehicle and staffing capacity, or would you need to ‘scale up’ your fleet/staffing to meet the demand and requirements outlined within this Lot Response Document and the mini competition.”

The answer given was “Yes”. It’s not clear which of the 2 diametrically opposite options the “Yes” response relates to.

NST also confirmed that it had 90 vehicles that it could allocate to meet the contract and, at least 10 staff.

These apparent contradictions should have raised questions with Derby City Council.

The accounts to 30 June 2023 show:

• An average of 4 staff for the whole year.
• Purchase of just £70k of additional motor vehicles ~5 vehicles
• Funding of the additional vehicles by short term credit – due for full repayment within 1 year
• Negative debtors which implies very low level sales, and/or prepayments to avoid cash flow problems
• A company that lost £10k in 2023 and was technically illiquid by £68k; that is, it could not pay its short term debts.

Opinion

It seems that NST was selected on the basis of the lowest price and an “excellent response” to the documented tender questions. Well written answers should be backed up by proper due diligence by the Council.

There were no evident questions which examined their financial resilience nor ones that scrutinised their ability to scale up to deliver the contract.

The most recent accounts do show that the company is very weak, financially, and it highlights that some of the answers given in the response to the tender do not bear close examination.

This further reinforces the call, made initially in the Derby News article (March 24 2024) for an audit of this contract to ensure an uninterrupted transport service for these vulnerable children.