Notice of gross misconduct hearing
Eight police constables are due to appear before a gross misconduct hearing.
Proceedings initially started in January this year when the case was part heard and subsequently adjourned until a later date.
The panel is now due to reconvene on Monday 4 September and it has been determined that the case will be heard in public. The hearing is expected to last five days.
The officers will answer allegations relating to offensive or discriminatory messages that were exchanged within a private phone messaging group in 2013 and 2014.
The professional standards of behaviour they are alleged to have breached, in part or in full, are:
• Authority, respect and courtesy
• Equality and diversity
• Discreditable conduct
• Challenging and reporting improper conduct
The hearing will take place at the National Training Centre in Gilmour Close, Beaumont Leys, starting at 9.30am.
To register your intention to attend the hearing, please fill out this online application form.
Welcome to the Oakham and Rutland News blog! I'm Martin Brookes, your Community Editor, excited to bring you the latest updates from the vibrant heart of Oakham and Rutland. Our new local news website is your go-to source for comprehensive coverage of everything happening in our community. From breaking news and local events to community spotlights and personal reflections, we've got you covered.
Thursday, August 31, 2017
Oakham Jobs 31st August 2017
Oakham Jobs 31st August 2017
Office Administrator- new
Nottingham Theatre Royal - Nottingham
£18,000 a year
| The Office Administrator works closely with the venue’s operational catering team, taking responsibility for all inbound sales admin, event and restaurant... |
Apply with your Indeed CV
Postman/Postwoman with Driving - Oakham Delivery Office (LE1... - new
Royal Mail Group - 2,591 reviews - Oakham| £7.40 - £17.00 an hour
A full UK manual driving licence (in your current UK address), with no more than 6 penalty points is essential but ideally a clean licence is preferred, please...
|
Personal Assistant - new
Direct Payments - Oakham| £10 an hour
Previous experience is not essential as full training will be provided, you would however be required to hold a full UK driving license....
Apply with your Indeed CV
|
Kitchen Porter - new
coach house saul - South Luffenham
Act in a professional manner. Arrange your own transport. We are looking for a hard working, self-motivated individual that can work flexible evening and...
Apply with your Indeed CV
|
Night Replenishment, Supermarket Assistant - new
Waitrose - 1,114 reviews - Stamford| £9.21 an hour
Job Type Selling - Non Management Region East England Location Stamford Preferred Hours Part Time Partnership Level 10 Closing Date 3 Sep 2017 Vacancy Type...
|
Department Administrator - new
OFFENDER LEARNING (OLASS) Milton Keynes College - Oakham LE15| £14,910 - £19,525 a year
We take extreme care in ensuring the safety and welfare of children, young people and vulnerable adults. In addition, the College delivers employability and key...
|
Library Assistant - new
Loughborough University - 49 reviews - Loughborough
The Library's User Services Team has 3 vacancies for Library Assistants. 15 September 2017. The Team staffs service points for ordinary and short loan and...
|
Part time Camera operatives - new
Catch My Match - Leicester| £10 an hour
Full UK driving licence with access to transport. Required licence or certification:. Access to own laptop and internet. Up to date DBS check....
Apply with your Indeed CV
|
Full time Night Care Assistant - new
Wisteria House - 2 reviews - Oakham LE15
It is essential that you have both knowledge and experience of working within a residential home, it is desired that you hold a level 2 in Health & social care,...
Apply with your Indeed CV
|
Creative Designer/Artist - new
deVOL Kitchens - Loughborough LE12
Founded by two design graduates from Loughborough University, we now employ over a hundred staff, of which around 40 are design graduates....
Apply with your Indeed CV
|
Secretary - new
Guaranteed Asphalt Ltd - Corby NN17| £7 an hour
File and update contact information of employees, customers, suppliers and external partners. Answering calls, taking messages and handling correspondence....
Apply with your Indeed CV
|
Waiting Staff
The Fox and Hounds Exton - Oakham LE15
| The property has undergone major refurbishment and the Hotel has 4 luxury suites, a bar, beer garden and a la carte restaurant.... |
Apply with your Indeed CV
Digital Customer Representative-Leicester
| You will be helping customers with queries and transactions via email and web chat. If you are passionate about supporting customers and are seeking a role in a... |
General Operator
| PepsiCo UK is home to some of the world's most loved food and drink products. We are committed to the local community and the environment via our corporate &... |
Leicester Pride Saturday 2 September 2017
Leicester Pride Saturday 2 September.
Every year the LGBT community in Leicester comes together to march through the city centre in a vibrant parade that marks the beginning of the festival.
Please note that no glass bottles are allowed on the parade and much of the route runs through the cities alcohol free zones.
This year we are significantly increasing security on the parade. We now require all groups of people greater than 5 to register or you may not be able to take part on the day. We may also ask to search your belongings at any point in the parade. Please be aware that this is ensure everyone’s safety following recent events in Manchester & London.
Below is a map of the parade route. The parade starts at 12 noon and arrives at the park for 1pm.
Union J will be headlining the main stage
Victoria Park is the main hub of the festival
To find out more, go to Leicesterpride.com .
The Leicester Mercury has a good article, and I can be spotted taking photographs
at a previous year in one of their photographs
Wednesday, August 30, 2017
The Minden Band of the Queens Division Oakham Market Place Beat Retreat 2017
The Minden Band of the Queens Division Oakham Market Place Beat Retreat 2017
Raymond James Investment Services New to Church Passage Oakham Rutland
Raymond James Investment Services New to Church Passage Oakham Rutland
Cllr Joyce Lucas Oakham Town Council Surgery September 2017
Cllr Joyce Lucas Oakham Town Council Surgery September 2017
Could We Co-opt PC Joe Lloyd onto Oakham Town Council
Dear Oakham Town Council
PC Joe Lloyd has posted the following on a Leicestershire Police Facebook Page
Rutland Police
17 hrs ·
Cutts Close is a lovely park area in the centre of Oakham its run by Oakham Town Council (all volunteers). It has some outdated play equipment (still love the swings though), and a new skate park which was designed for younger skaters, scooters etc. If funding and permissions could be granted what would you want to see in the Park?
I'm getting feedback that our 13-18yr olds are a little bored and there isn't much for them?
Also music during the summer would the younger generation want or even be interested in younger bands playing in the park?
Thanks And let me know your thoughts. Joe
I have pointed out in the past his and other residents concerns relating to the summer concert not catering for
younger members of our community.
I shared his tweet and this was ignored like most things I point out to this council.
The comments on the page are interesting, they include a comment from a friend of Flo Skate
who want a new skate park.
More seriously is the ever growing crowd of drinkers and smokers, despite many reports about this
we as a council don't appear to be taking any action to stop this.
PC Lloyd mentions the play equipment.
Once again I ask why the Wickstead reports are not shared with all members of the council.
We have a duty of care to all our residents and it once again appears know one else is in the
slightest bit bothered.
The roundabout has been list as a safety concern for a number of years and nothing has
been done to rectify this. Do we have to wait for a child to break an arm before we get it
fixed?
PC Joe Lloyd is a good man living and working in Oakham, who has contact with young people
and families something we lack at the council, could we not invite him for
co-option so he can help us sort out these issues?
PC Lloyd describes as voilunteers, I must correct him and point out the local goverment
act states we are not volunteers but elected members. We are the bottom level of
local government no a voluntary club, I know that may be hard to beleive but its true.
Another consideration is most parish council invite there local officer of PCSO to attend
meetings and contribute. We don't?
From
Martin Brookes
OSE Cllr
PC Joe Lloyd has posted the following on a Leicestershire Police Facebook Page
Rutland Police
17 hrs ·
Cutts Close is a lovely park area in the centre of Oakham its run by Oakham Town Council (all volunteers). It has some outdated play equipment (still love the swings though), and a new skate park which was designed for younger skaters, scooters etc. If funding and permissions could be granted what would you want to see in the Park?
I'm getting feedback that our 13-18yr olds are a little bored and there isn't much for them?
Also music during the summer would the younger generation want or even be interested in younger bands playing in the park?
Thanks And let me know your thoughts. Joe
I have pointed out in the past his and other residents concerns relating to the summer concert not catering for
younger members of our community.
I shared his tweet and this was ignored like most things I point out to this council.
The comments on the page are interesting, they include a comment from a friend of Flo Skate
who want a new skate park.
More seriously is the ever growing crowd of drinkers and smokers, despite many reports about this
we as a council don't appear to be taking any action to stop this.
PC Lloyd mentions the play equipment.
Once again I ask why the Wickstead reports are not shared with all members of the council.
We have a duty of care to all our residents and it once again appears know one else is in the
slightest bit bothered.
The roundabout has been list as a safety concern for a number of years and nothing has
been done to rectify this. Do we have to wait for a child to break an arm before we get it
fixed?
PC Joe Lloyd is a good man living and working in Oakham, who has contact with young people
and families something we lack at the council, could we not invite him for
co-option so he can help us sort out these issues?
PC Lloyd describes as voilunteers, I must correct him and point out the local goverment
act states we are not volunteers but elected members. We are the bottom level of
local government no a voluntary club, I know that may be hard to beleive but its true.
Another consideration is most parish council invite there local officer of PCSO to attend
meetings and contribute. We don't?
From
Martin Brookes
OSE Cllr
Rutland County Council Library and Children' Services Building Work Over Budget, Damming Audit and Risk Report
Rutland County Council Library and Children' Services Building Work Over Budget, Damming Audit and Risk Report
Audit and Risk Committee Wednesday, 30th August, 2017 7.00 pm Council Chamber
Will be considering another report highlighting failings by Rutland County Council a splash of paint and a few posh mobile units see the council fail with their budget predictions.
The Library and Children's Service project here in Rutland is currently £309,000
over budget.
The blame should not be placed at the feet of the current Tory leadership,
who I strongly believe need to toughen up and take broom and push it in the
direction of senior council officers who are responsible for losing millions of pounds
of public money with the approval of the past Tory leadership.
The old Ashwell prison / Enterprise Park, is another example of former Councillors Terry Kings and Begy's dark days. that project went many more thousands over budget and the council
has managed to keep a lid on that billing it a success.
Such a success they want to name the former Rutland County College building
another failing of this council, The King Business Centre.
Let's hope the council does not mess up that project or perhaps they should just sell
building. Although I would very much doubt the would be able to sell it for the
price they paid for it a few years ago.
We have had a change in the political side at Rutland County Council, I may not
approve of the party they represent, but I can see change.
All that is needed now is for them to make a major change at the top of the officers
pile. The CEO has been in her position for far to long. How many more times can
she say the council has learnt from their costly mistakes?
Report No: 155/2017
PUBLIC REPORT
AUDIT AND RISK COMMITTEE
30th August 2017
CHILDREN’S CENTRE & LIBRARY PROJECT
Report of the Head of Internal Audit
Strategic Aim: All
Exempt Information No
Cabinet Member(s)
Responsible:
Councillor Tony Mathias, Leader of the Council
Contact Officer(s): Rachel Ashley-Caunt, Head of
Internal Audit
Tel: 07824 537900
rashley-caunt@rutland.gcsx.gov.uk
Ward Councillors N/A
DECISION RECOMMENDATIONS
1. That Members note the findings of the review by Internal Audit and the
responses from management on the lessons learnt.
1 PURPOSE OF THE REPORT
1.1 To provide the Committee with the findings of the Internal Audit consultancy
review of the Children’s Centre/Library project and the management response.
2 BACKGROUND AND MAIN CONSIDERATIONS
Internal Audit Review
2.1 In April 2017, the Council’s Cabinet approved an additional budget allocation of
£309,000 for the joint Children’s Centre relocation and Library Refurbishment
project. On approving the additional funding, Cabinet requested that a review be
undertaken by Internal Audit into the significant increase in required funding.
2.2 The Head of Internal Audit has conducted a review of this project which has
involved review of project documentation and interviews with relevant officers.
The review has highlighted the reasons for the additional funding requirements
and a number of lessons learnt, particularly in relation to the project initiation
phase.
2.3 Since the project governance arrangements have been established and the project
management controls have been applied, there is evidence that the issues arising
due to weaknesses in the project initiation stage have been identified and are
being managed.
2.4 The budget setting process conducted during the initiation stage was flawed in that
it was not fully informed and effectively scrutinised. The financial pressures arising
from this have been highlighted since the project management arrangements have
been established and comprehensive commitment records have been developed.
Value engineering, negotiations and revisions of specifications have also been
undertaken by officers, with support from consultants who have been appointed to
provide specialist advice and insight.
2.5 The report, provided in Appendix A, sets out the basis for the additional funding
requirements, including which of these further costs had been underestimated,
which had not been accounted for in budget setting and which had increased due
to unforeseen issues/difficulties.
2.6 Senior management have prepared a response to the findings to ensure that the
issues identified will be suitably addressed for future projects. The management
response is provided at Appendix B.
3 CONSULTATION
3.1 The Council’s senior management have been consulted on the findings and
lessons learnt. The response from management is provided as Appendix B to this
report.
4 FINANCIAL IMPLICATIONS
4.1 There are no financial implications arising from this report. The additional project
funding has been approved by Cabinet.
5 LEGAL AND GOVERNANCE CONSIDERATIONS
5.1 There are no legal implications arising from this report.
6 EQUALITY IMPACT ASSESSMENT
6.1 There are no equality implications arising from this report.
7 COMMUNITY SAFETY IMPLICATIONS
7.1 There are no community safety implications arising from this report.
8 HEALTH AND WELLBEING IMPLICATIONS
8.1 There are no health and wellbeing implications.
9 CONCLUSION AND SUMMARY OF REASONS FOR THE
RECOMMENDATIONS
9.1 The Internal Audit review of the Children’s Centre and Library project has
highlighted the basis for the increased budget requirements and the lessons
learnt, particularly in relation to the initiation stage of capital projects.
10 BACKGROUND PAPERS
10.1 There are no additional background papers to the report
11 APPENDICES
11.1 Appendix A: Internal Audit Consultancy report – Children’s Centre and Library
project
11.2 Appendix B: Management Response
Appendix A
INTERNAL AUDIT CONSULTANCY REPORT
Children’s Centre & Library Project
Issue Date: 29th June 2017 Issued to: Helen Briggs, Chief Executive
Author: Rachel Ashley-Caunt, Head of Internal Audit Cllr Tony Mathias, Leader
Cllr Oliver Hemsley, Deputy Leader
Children’s Centre/Library Project – Consultancy review
Executive Summary
1. Introduction
In June 2016, the Council’s Cabinet approved the allocation of £220k for the provision of ‘Essential Works’
on Oakham Library. It was subsequently agreed, in September 2016, that the Children’s Centre would be
relocated to the Library site and this then became a consolidated project with an agreed, revised overall
budget of £680k (including an additional £60k for the Library project).
The refurbishment of the Library and the relocation of the Children’s Centre had arisen from different
business cases but the consolidation of the two projects was intended to deliver efficiencies and maximise
the benefits for the community.
In April 2017, additional funding was sought to deliver the project. The increased budget requirement
requested was a further £309k. Table 1 provides an overview of the funding agreed. This was formally
approved by Cabinet and it was also requested that Internal Audit be commissioned to investigate the
significant increase in the required funds.
Table 1: Project budget approvals
Date Decision Total for Budget split
Project Shared
(Design)
Library Children’s
Centre
June 2016 Essential works
to Oakham
Library
£220k £220k
September 2016 Decision to
move Children’s
Centre to the
Library
£680k £280k £400k
April 2017 Increased
budget
£989k £107k £325k £557k
The purpose of this review was to establish the reasons for the increased budgetary requirements on the
project and to review the design and effectiveness of the project management arrangements, highlighting
any areas which require strengthening in the later phases and lessons learnt for future projects.
It is acknowledged that the project is subject to time pressures, particularly due to the need to relocate
the children’s centre and enable school places to be filled at Catmose College. This has incurred further
pressure on the project delivery and resulted in the need to seek exemptions from some policy
requirements and controls.
2. Approach
In order to consider and assess the governance and financial management of the project to date, the
review has included the following key stages:
Consultation with those officers who have played a role in the management of the project;
Discussions with the Council’s Finance team who have provided support in confirming expenditure
and commitments to date;
Review of evidence available in relation to the procurement of goods and services for the project;
and
Review of project governance documentation and reports to the Council’s Project Board.
3. Summary of findings
At the time of reporting, the project is progressing and the Project Team are working against the revised
budget of £989k. It is acknowledged that delivery against budget remains an ongoing risk and actions are
being taken to manage and value engineer spend where possible.
It is evident from the review that the original budget setting exercise was naïve and un-informed. The
budget setting had been brought forward too early and rushed and had been, based on principles and
preliminary figures only - as a consequence the original budget setting was flawed. The budget estimates
had not been fully informed, as no feasibility studies had been undertaken, and some realistic costs had
been excluded from the budget which was presented for formal approval. In recent months, since the
Project Board has been established, a number of studies and surveys have been conducted as the project
progressed and these have enabled realistic, informed forecasts to be developed, which have highlighted
a number of financial pressures against the original agreed budget allocations. Furthermore, initial costs
quoted by a key supplier were significantly understated and amendments have been required to the
specification. Whilst these costs have increased significantly since the supplier provided their original
quotation, primarily due to a lack of competition and time pressures, a decision has been made to
continue to progress with this supplier and reduce the specification to achieve affordability.
It is evident that the original budgets which were formally approved did not include allocations for costs
such as design and planning fees or library mechanical works (i.e. water installation, soil and waste pipes
etc). It would be reasonable to expect these costs to be incurred given the nature of the projects and, as
such, it was a significant risk to fail to account for them in the original budget. At the time of review, an
expected spend of £185k has been reported in the latest forecast for these budget lines alone. It is
evident, from review of project documentation, that some of these costs had been included in original
budget setting but were removed before presentation to Cabinet for formal approval.
Further costs have also been incurred on unforeseen issues such as, extensive roofing and electrical
works. Generally, in capital projects, such costs would have been covered by contingency budgets but, for
the Library project, the contingency allocations had been removed from the budget before it was
approved by Cabinet so, again, no monies were available to address these issues. An analysis of the
reasons for the financial pressures against original budgets (including costs which had not been accounted
for, those which were underestimated and those which were unforeseen) is explored further in section 4
of this report.
Following the formal approval of the funding and business case, external advice and feasibility reviews
provided in November 2016 did recommend that the project would not be achievable within the original
budget allocations – with estimates given of £1.2 million. It is evident that action was taken at this point
to present the reports, with financial implications, to the Project Board to consider whether the business
case should be re-visited before proceeding. Decisions were taken to value engineer the estimated costs
and to establish a realistic, acceptable budget requirement in order to request additional monies from
Cabinet in April 2017. One action taken was to project manage the works directly, rather than employing
a project management lead, to reduce costs. Specifications for elements of the builds have been
amended to effectively achieve the deliverables but at a more ‘basic’ standard than had been previously
costed. The Council’s consultants and surveyors have also been actively engaged in negotiating and
evaluating quotations from suppliers.
The Council’s finance team have worked with project officers to establish a comprehensive budget for the
project which is enabling close monitoring against each budget line. This has enabled much greater
transparency and control over all project costs and will highlight any emerging pressures.
It should be noted that there is no allowance within the current project budget for contingency, which
clearly poses a risk to the ongoing project delivery. In any complex capital project there is potential for
unforeseen issues and costs to be incurred and without any contingency budget there is a significant risk
that there is no funding to address such issues. An allowance for contingency had been included in the
approved budget for the Children’s Centre project but has since been removed from budget forecasts in
order to balance the forecast against the funding approved. This will not represent a true saving should
any unforeseen issues arise during delivery that cannot be absorbed within the agreed project funding. As
above, there was no allowance in the approved Library project budget for contingency.
The overall project management documentation has been reviewed and it is clear that the project now
has established governance arrangements and it is evident from recent project documentation that risks
and issues are being actively identified, managed and reviewed. All actions from meetings are recorded
and change control procedures are in place. Good use is also being made of in-house professional skills
and expertise – with senior officers from Finance and Property at all Project Board/Team meetings and the
appointment of an experienced Project Manager. Specialist advice and support has also been obtained in
the form of a quantity surveyor and architects to act as agents on the Council’s behalf. These governance
arrangements will need to continue to operate robustly to ensure that any emerging pressures on the
budget are actively identified and pro-actively managed. These arrangements will also assist to ensure the
Council obtains value for money.
Lessons should be learnt for future projects that the budget setting process for capital projects must be
suitably informed and robust. It should be the responsibility of the project sponsor to ensure that budgets
which are presented for approval incorporate all costs which the Council can reasonably be expected to
incur and that sufficient initial survey work has been undertaken to ensure the project is feasible. It is also
good practice to allow for a contingency element to cover those unforeseen issues which may arise once
further surveys are conducted and work commences.
4. Detailed findings
Analysis of increased budget requirements
Budget setting – costs omitted from initial budgets
The budgets which were originally set for the two projects were developed by the Council’s Property team
which includes experienced property professionals. From review of the evidence provided, it is clear that
the original budget developed for the Library project totalled £305k but this was reduced to £220k before
it was presented to Cabinet for approval, by removing allocations for contingency and design fees and
halving the budget for temporary accommodation. Furthermore, it is evident that no feasibility studies or
surveys had been conducted before the budget figures were compiled for Cabinet approval.
Based on the analysis undertaken during this review, the costs in Table 2 had not been accounted for
within the original budgets which were approved by Cabinet (June 2016 for the Library and September
2016 for the Children’s Centre).
Table 2: Expenditure for which there was no allocation in approved budgets (based on budgets approved
in June 2016 and September 2016)
Description Spent/committed to date Current forecast total
Design fees (including architects and surveyors) £99,612 £99,867
Mechanical works for Library - £33,195
Internal decorations/alterations for Library - £16,444
Enabling works for Library £14,978 £14,978
Planning fees £3,197 £4,455
Library fixtures and fittings - £6,787
Children’s Centre move costs - £1,100
Contractor prelims - Library - £3,850
Modular build – data cabling £5,279 £5,279
IT costs - £1,000
Totals £123,066 £186,955
It would appear reasonable that these costs should have been expected given the nature of the project
and, as such, the financial implications should have been accounted for in the project budgets. As noted
above, there had been a budget originally set for design fees (of £35k) but this was removed on request
from elected members before the budget was presented for formal approval. It is understood that spend
on fixtures and fittings and shelving had also been excluded on the basis that old fixtures would be reused.
Whilst this has been followed where possible, this has not proven to be a suitable option in all cases
based on the state of some equipment. Such challenge in the initial planning stage, appears to have
resulted in additional pressure to minimise the estimated budget before presenting it for formal approval
and it is acknowledged by officers that the budget which was approved was not realistic. The project
sponsor should be responsible for ensuring that all project budgets are fully informed and robust before
seeking any formal approval.
Officers have advised that the budgets were set based on experience on other projects and estimates
based on pricing lists. As no feasibility studies had been conducted at that time, the budget setting was
not fully informed and the extent of the refurbishment and mechanical works required were unknown.
Whilst initial studies would have incurred early financial investment, this would have enabled informed
decision making from the outset of the project.
The finance team have advised that they did not receive a detailed budget breakdown until the
procurement stage had commenced. Until the procurement stage, it is understood that projected costs
had been based on average unit rates from other projects.
Budget setting – costs underestimated in initial budget setting
A failure to conduct sufficient studies at the outset of such a project presents the risk of a lack of
awareness of potential groundworks, drainage and electrical issues etc, all of which can present significant
additional costs. There is also an increased risk of uninformed estimates of costs if these are not
rigorously reviewed and subject to specialist advice at the outset. A key area of pressure on the Children’s
Centre project funding has been in relation to the cost of the modular build and the groundworks required
for its installation.
Based on evidence provided, multiple quotations had been sought in relation to the modular build but
only one formal response was received and other suppliers contacted declined to submit a quote. Officers
had provided details of the requirements including a floor plan and a topographical survey when seeking
the quotations but it became evident once the costs were further explored with the supplier that the
quote provided had not allowed for all requirements within the specification. Once amended to include
the Council’s requirements, such as glazed partitions and foundations, the quotation increased
significantly. The Council’s officers and appointed surveyors have undertaken a negotiation and value
engineering process with the supplier in order to reduce the costs but it is acknowledged that this will
reduce the quality and benefits of the final build. The higher cost designs had been based on a top
specification with top quality interiors and over engineered groundworks. Whilst the specification has
been reduced to enable affordability, the deliverable is intended to satisfy the key requirements at a more
‘standard’ level with some higher specification interior items.
The initial figure included in the approved budget for the modular build (including delivery, installation,
preliminary works, foundations, electrical and external works) was £329,950. The latest forecast, at the
time of reporting, is £519,721. This has been subject to value engineering by officers and has been
reviewed and negotiated by the consultants and agents, with the value for money being assessed by the
independent consultants. Table 3 shows the original budgets against the latest forecasts.
Table 3: Modular build original budgets and latest forecasts
Description Original budget
September 2016
Current forecast
total
Variance
against original
budget
Modular build £262,750 £245,500 £17,250
Delivery and installation £7,500 £25,000 -£17,500
Prelims, foundations and electrical £9,700 £203,780 £194,080
External works £50,000 £8,441 -£41,559
Mechanical - £37,000 £37,000
Links to library (now accounted for
under other budget lines, above)
£6,000 - -£6,000
Buggy park (now accounted for under
other budget lines, above)
£5,000 - -£5,000
Intruder and fire alarms - £9,650 £9,650
Access controls - £2,282 £2,282
Totals £340,950 £531,653 £190,203
It is understood that some early challenge from elected members in relation to the Children’s Centre
budget figures had been based on comparison to cheaper modular builds which had been used on other
sites as storage facilities – but such cheaper builds would not have satisfied the specification for the
intended use by the Children’s Centre and would not be fitting with the location.
It was also noted that the original budget had been set based on a modular build with a floor area of
150m² but before the budget was approved by Cabinet the floor area of the modular build had increased
to 200m². This amendment appears to have been applied between the initial report to the Council’s SMT
and the formal report to Cabinet in September 2016 but the budget allocation was not increased to reflect
this. As this was before the project was established there was no change control process and no evidence
to explain this change has been provided.
Unforeseen issues and costs encountered during the project
By the nature of complex capital projects, there is a risk of unforeseen problems and associated costs
arising during delivery. This is usually the purpose of the contingency budgets, to enable such issues to be
addressed as they arise.
On this project, particular issues have been encountered with the roofing of the Library building and the
Library’s electrical wiring. These issues had not been identified at the outset of the project and, as such,
insufficient funding had been allocated to cover the costs. In September 2016, following an architectural
review, an additional £60,000 was requested and approved by Cabinet based on these additional roofing
and electrical works required. The budgets and current forecast in relation to these works are provided in
Table 4.
Table 4: Financial implications of unforeseen issues
Description Original budget –
April 2016
Current forecast total Variance against
original budget
Roofing £64,000 £81,618 £17,618
Electrics – Library (including
lighting)
£33,000 £83,780 £50,780
Upgrade to electrical supply - £11,681 £11,681
Ceiling replacement - Library £18,000 £20,963 £2,963
Tank removal – change request - £963 £963
Reception desk - £2,420 £2,420
£115,000 £201,425 £86,425
It was noted during the review, that in relation to specific issues arising, such as removal of the tank, a
documented change control process has been applied and the financial implication has been logged within
the project management reports. This demonstrates an effective mechanism for managing any change in
scope and ensuring any additional spend, beyond the original business case, is formally approved and
should be enforced for all amendments to the scope throughout the delivery stages.
Value engineering and budget amendments
In order to assist in managing the financial pressures of the additional costs set out above, a number of
savings have been achieved against other budget lines and extensive value engineering has been
undertaken by officers and the consultants. The main savings currently forecast are set out in Table 5. It
should be noted that this leaves no contingency allocation for the delivery stages of the project which
could pose a risk and may not be a true saving should any difficulties arise.
Table 5: Areas of saving in latest budget forecast
Description Original budget –
September 2016
Current forecast total Variance against
original budget
Library windows and doors £21,000 £15,773 - £5,227
Asbestos removal £10,000 £6,670 -£3,330
Savings achieved on temp
accommodation for Library
£15,000 £14,362 -£636
Contingency £52,642 - -£52,642
£98,642 £36,805 -£61,835
In addition to those reduced budgets reported in Table 5, there are a number of items which have not
been commissioned or have been amended from the original specification in order to support the budget
position. The key areas are set out in Table 6.
Table 6: Items included in approved budgets, for which spend has not been incurred or forecast
Description Original budget – approved in
September 2016
Current
forecast total
Variance against
original budget
External works – gardens £36,000 - -£36,000
£36,000 -£36,000
Overall impact
The variances highlighted in Tables 2 to 6 are summarised in Table 7, to demonstrate the basis for the
overall £369,000 additional budget sought and approved by Cabinet (£60,000 in September 2016 and
£309,000 in April 2017).
It should be noted that this does not include every budget line variance but is intended to provide an
overview to demonstrate the key reasons for the main variances against the original, approved budgets.
Table 7: Overall financial implications
Description Variance against
original budget
Costs not included in original budget setting £186,955
Underestimated costs on modular build £190,203
Roofing and electrical issues £86,425
Areas of savings against original budget -£61,835
Budget lines not applied -£36,000
£365,748
Current position
At the time of reporting, delivery against the revised project budget remains a key risk and further
possible additional costs continue to arise and are being logged and discussed at Project Board. It is also
evident that much work is underway to manage the risk and mechanisms are operating to ensure the
financial implications of any changes or issues are logged and accounted for.
Additional costs have arisen since the last budget approval, including data cabling and further electrical
works, but there is evidence that a thorough review of the budget position has been undertaken, with
assistance from Finance, and a number of savings have also been identified. It should be noted, however,
that some of these savings will reduce the quality and outcomes of the project. Examples include changes
to the library shelving and lower quality materials on flooring and ramps – which are likely to reduce the
lifespan of some items and may incur further costs following the transfer to business as usual. The savings
on the change in materials for the ramp, for example, may require this to be replaced in an estimated 10
years, rather than 25 years.
Change requests and optional costs are risk assessed and the financial implications are logged. These are
presented to the Project Board for information and decisions on actions to be taken.
Based on the latest projections, which have included input from external consultants, the budget of
£989,000 remains challenging and requires ongoing close management.
Review of Project Management arrangements
Procurement and financial controls
Due to the challenging time pressures on the project delivery, formal approval has been sought for
exemptions from the Contract Procedure Rules for the key areas of procurement. The highest value
contracts are in relation to the modular build and refurbishment works, for which a formal exemption has
been approved and assurance has been given by independent legal and property professionals over the
value for money secured.
Other high value spend has included the architects and consultants who have been appointed by the
Council. Formal approval to directly appoint the architects was given in the form of a delegation by
Cabinet in September 2016. An overview of the key procurements on the project to date is provided in
Table 8.
Table 8: Key contracts on the project and procurement routes followed
Supplier Value Procurement route Notes
Portable Offices (modular build) To be confirmed
(contract not yet
signed)
Quotations sought
from multiple
companies – only
one quotation
received
Metcalfs (Library refurbishment) £303,000
Contract signed
Single tender
Exemption form
approved by key
officers and Members.
Assurances given by
independent legal
professional over
value for money
secured and
confirmation that this
was an appropriate
route to follow in the
best interests of the
project.
Weston Allison Wright
(Architects)
£30,481
to date
Directly appointed -
no alternative
quotations sought
Delegation formally
approved by Cabinet
in September 2016 to
directly appoint.
Supplier Value Procurement route Notes
FK Howard (quantity surveyors) £14,500
committed to date
Directly appointed -
no alternative
quotations sought as
each order was
valued at under
£10,000
Treated as two
separate orders, both
under £10,000.
Second phase of work
commissioned
following additional
support required.
As shown in Table 8, the key expenditure on the project has not been consistently subject to competition
but this has been formally approved via exemptions in the highest spend areas. It is also understood that
where competition has been sought there has been a limited market available. It should be noted that the
appointment of the quantity surveyors was based upon two orders, both under £10,000, but there is a risk
that this could be challenged as disaggregation of spend – given that any spend exceeding £10,000 must
be subject to multiple quotations. In this case, it would have been advisable to seek alternative
quotations or seek an exemption for the second phase of work given the need to maintain continuity with
the same supplier. Given the wider scale of the project, this is not a significant contract but is noted as an
area for improvement in transparency and competition on lower level spend.
Where key areas of expenditure have been committed this has been recorded on the financial system via
the raising and approval of a purchase order. This is in accordance with the Council’s financial procedures
and good practice to ensure that budget forecasts are accurate and any known expenditure has been
accounted for.
A thorough review and breakdown of the budget has been supported by the Finance team and this has
provided a transparent and comprehensive basis for monitoring this spend during delivery.
Governance and decision making
The Project Board includes a number of senior officers and has been meeting on a regular basis since
September 2016, with clear action points agreed. Key decisions on the project have been subject to
formal approval via Cabinet and delegations have been sought, where required, to enable progress to be
made on the project. It is noted that since December 2016 the Project Board has also included elected
members.
No evidence has been identified of any decisions made to commit expenditure outside of formal
delegations and where exemptions from contract rules have been sought there is a full audit trail readily
available.
Risk and Issue Management
There is a risk and issues log for the project which has been regularly updated and is a standing agenda
item on each Project Team meeting. Risks are also regularly discussed at the Project Board level, where
representatives from the Project Team and professional leads are present and able to contribute to the
identification and management of these risks.
The risk of budget pressures is identified within the Risk Log and assessed as a ‘red’ risk, with an action to
monitor and report spend carefully throughout the project. Where risks have been identified and logged,
it has been noted where they will be likely to incur a cost implication, albeit a value is not always stated. It
would be advisable to reflect an estimate of potential costs to ensure the impact is fully understood, given
the lack of contingency allocation.
Issues encountered on the delivery of the project are also being actively logged and monitored.
Project resources
In managing a complex capital project it is important that a suitable range of skills and experience are
involved in supporting its effective delivery. This project is benefiting from officers with professional
expertise including experienced, senior officers from Finance and Property services. Legal professionals
have also contributed on key stages of the project.
Consultants and quantity surveyors have also been appointed to provide independent, specialised input
on the review and negotiation of quotations and support project delivery.
The Finance team has been actively engaged in the project and maintain detailed commitment records
and forecast outturns.
5. LESSONS LEARNT AND NEXT STEPS
The findings of this review have been discussed with senior management and a number of lessons have
been learnt.
The review has highlighted that since the project governance arrangements have been established the
weaknesses and pressures have been highlighted and action is being taken to manage the financial
pressures. The review has particularly highlighted weaknesses in the project initiation stage which should
be addressed for any future projects to ensure that the business case and budget have been suitably
scrutinised and informed before any formal decision making takes place.
It is understood that senior management are developing a list of key areas to be addressed in light of the
findings and Internal Audit can advise on this, as appropriate.
6. LIMITATIONS TO THE SCOPE OF THE REVIEW
The Auditor’s work does not provide any guarantee against material errors, loss or fraud. It does not
provide absolute assurance that material error; loss or fraud does not exist.
Audit and Risk Committee Wednesday, 30th August, 2017 7.00 pm Council Chamber
Will be considering another report highlighting failings by Rutland County Council a splash of paint and a few posh mobile units see the council fail with their budget predictions.
The Library and Children's Service project here in Rutland is currently £309,000
over budget.
The blame should not be placed at the feet of the current Tory leadership,
who I strongly believe need to toughen up and take broom and push it in the
direction of senior council officers who are responsible for losing millions of pounds
of public money with the approval of the past Tory leadership.
The old Ashwell prison / Enterprise Park, is another example of former Councillors Terry Kings and Begy's dark days. that project went many more thousands over budget and the council
has managed to keep a lid on that billing it a success.
Such a success they want to name the former Rutland County College building
another failing of this council, The King Business Centre.
Let's hope the council does not mess up that project or perhaps they should just sell
building. Although I would very much doubt the would be able to sell it for the
price they paid for it a few years ago.
We have had a change in the political side at Rutland County Council, I may not
approve of the party they represent, but I can see change.
All that is needed now is for them to make a major change at the top of the officers
pile. The CEO has been in her position for far to long. How many more times can
she say the council has learnt from their costly mistakes?
Report No: 155/2017
PUBLIC REPORT
AUDIT AND RISK COMMITTEE
30th August 2017
CHILDREN’S CENTRE & LIBRARY PROJECT
Report of the Head of Internal Audit
Strategic Aim: All
Exempt Information No
Cabinet Member(s)
Responsible:
Councillor Tony Mathias, Leader of the Council
Contact Officer(s): Rachel Ashley-Caunt, Head of
Internal Audit
Tel: 07824 537900
rashley-caunt@rutland.gcsx.gov.uk
Ward Councillors N/A
DECISION RECOMMENDATIONS
1. That Members note the findings of the review by Internal Audit and the
responses from management on the lessons learnt.
1 PURPOSE OF THE REPORT
1.1 To provide the Committee with the findings of the Internal Audit consultancy
review of the Children’s Centre/Library project and the management response.
2 BACKGROUND AND MAIN CONSIDERATIONS
Internal Audit Review
2.1 In April 2017, the Council’s Cabinet approved an additional budget allocation of
£309,000 for the joint Children’s Centre relocation and Library Refurbishment
project. On approving the additional funding, Cabinet requested that a review be
undertaken by Internal Audit into the significant increase in required funding.
2.2 The Head of Internal Audit has conducted a review of this project which has
involved review of project documentation and interviews with relevant officers.
The review has highlighted the reasons for the additional funding requirements
and a number of lessons learnt, particularly in relation to the project initiation
phase.
2.3 Since the project governance arrangements have been established and the project
management controls have been applied, there is evidence that the issues arising
due to weaknesses in the project initiation stage have been identified and are
being managed.
2.4 The budget setting process conducted during the initiation stage was flawed in that
it was not fully informed and effectively scrutinised. The financial pressures arising
from this have been highlighted since the project management arrangements have
been established and comprehensive commitment records have been developed.
Value engineering, negotiations and revisions of specifications have also been
undertaken by officers, with support from consultants who have been appointed to
provide specialist advice and insight.
2.5 The report, provided in Appendix A, sets out the basis for the additional funding
requirements, including which of these further costs had been underestimated,
which had not been accounted for in budget setting and which had increased due
to unforeseen issues/difficulties.
2.6 Senior management have prepared a response to the findings to ensure that the
issues identified will be suitably addressed for future projects. The management
response is provided at Appendix B.
3 CONSULTATION
3.1 The Council’s senior management have been consulted on the findings and
lessons learnt. The response from management is provided as Appendix B to this
report.
4 FINANCIAL IMPLICATIONS
4.1 There are no financial implications arising from this report. The additional project
funding has been approved by Cabinet.
5 LEGAL AND GOVERNANCE CONSIDERATIONS
5.1 There are no legal implications arising from this report.
6 EQUALITY IMPACT ASSESSMENT
6.1 There are no equality implications arising from this report.
7 COMMUNITY SAFETY IMPLICATIONS
7.1 There are no community safety implications arising from this report.
8 HEALTH AND WELLBEING IMPLICATIONS
8.1 There are no health and wellbeing implications.
9 CONCLUSION AND SUMMARY OF REASONS FOR THE
RECOMMENDATIONS
9.1 The Internal Audit review of the Children’s Centre and Library project has
highlighted the basis for the increased budget requirements and the lessons
learnt, particularly in relation to the initiation stage of capital projects.
10 BACKGROUND PAPERS
10.1 There are no additional background papers to the report
11 APPENDICES
11.1 Appendix A: Internal Audit Consultancy report – Children’s Centre and Library
project
11.2 Appendix B: Management Response
Appendix A
INTERNAL AUDIT CONSULTANCY REPORT
Children’s Centre & Library Project
Issue Date: 29th June 2017 Issued to: Helen Briggs, Chief Executive
Author: Rachel Ashley-Caunt, Head of Internal Audit Cllr Tony Mathias, Leader
Cllr Oliver Hemsley, Deputy Leader
Children’s Centre/Library Project – Consultancy review
Executive Summary
1. Introduction
In June 2016, the Council’s Cabinet approved the allocation of £220k for the provision of ‘Essential Works’
on Oakham Library. It was subsequently agreed, in September 2016, that the Children’s Centre would be
relocated to the Library site and this then became a consolidated project with an agreed, revised overall
budget of £680k (including an additional £60k for the Library project).
The refurbishment of the Library and the relocation of the Children’s Centre had arisen from different
business cases but the consolidation of the two projects was intended to deliver efficiencies and maximise
the benefits for the community.
In April 2017, additional funding was sought to deliver the project. The increased budget requirement
requested was a further £309k. Table 1 provides an overview of the funding agreed. This was formally
approved by Cabinet and it was also requested that Internal Audit be commissioned to investigate the
significant increase in the required funds.
Table 1: Project budget approvals
Date Decision Total for Budget split
Project Shared
(Design)
Library Children’s
Centre
June 2016 Essential works
to Oakham
Library
£220k £220k
September 2016 Decision to
move Children’s
Centre to the
Library
£680k £280k £400k
April 2017 Increased
budget
£989k £107k £325k £557k
The purpose of this review was to establish the reasons for the increased budgetary requirements on the
project and to review the design and effectiveness of the project management arrangements, highlighting
any areas which require strengthening in the later phases and lessons learnt for future projects.
It is acknowledged that the project is subject to time pressures, particularly due to the need to relocate
the children’s centre and enable school places to be filled at Catmose College. This has incurred further
pressure on the project delivery and resulted in the need to seek exemptions from some policy
requirements and controls.
2. Approach
In order to consider and assess the governance and financial management of the project to date, the
review has included the following key stages:
Consultation with those officers who have played a role in the management of the project;
Discussions with the Council’s Finance team who have provided support in confirming expenditure
and commitments to date;
Review of evidence available in relation to the procurement of goods and services for the project;
and
Review of project governance documentation and reports to the Council’s Project Board.
3. Summary of findings
At the time of reporting, the project is progressing and the Project Team are working against the revised
budget of £989k. It is acknowledged that delivery against budget remains an ongoing risk and actions are
being taken to manage and value engineer spend where possible.
It is evident from the review that the original budget setting exercise was naïve and un-informed. The
budget setting had been brought forward too early and rushed and had been, based on principles and
preliminary figures only - as a consequence the original budget setting was flawed. The budget estimates
had not been fully informed, as no feasibility studies had been undertaken, and some realistic costs had
been excluded from the budget which was presented for formal approval. In recent months, since the
Project Board has been established, a number of studies and surveys have been conducted as the project
progressed and these have enabled realistic, informed forecasts to be developed, which have highlighted
a number of financial pressures against the original agreed budget allocations. Furthermore, initial costs
quoted by a key supplier were significantly understated and amendments have been required to the
specification. Whilst these costs have increased significantly since the supplier provided their original
quotation, primarily due to a lack of competition and time pressures, a decision has been made to
continue to progress with this supplier and reduce the specification to achieve affordability.
It is evident that the original budgets which were formally approved did not include allocations for costs
such as design and planning fees or library mechanical works (i.e. water installation, soil and waste pipes
etc). It would be reasonable to expect these costs to be incurred given the nature of the projects and, as
such, it was a significant risk to fail to account for them in the original budget. At the time of review, an
expected spend of £185k has been reported in the latest forecast for these budget lines alone. It is
evident, from review of project documentation, that some of these costs had been included in original
budget setting but were removed before presentation to Cabinet for formal approval.
Further costs have also been incurred on unforeseen issues such as, extensive roofing and electrical
works. Generally, in capital projects, such costs would have been covered by contingency budgets but, for
the Library project, the contingency allocations had been removed from the budget before it was
approved by Cabinet so, again, no monies were available to address these issues. An analysis of the
reasons for the financial pressures against original budgets (including costs which had not been accounted
for, those which were underestimated and those which were unforeseen) is explored further in section 4
of this report.
Following the formal approval of the funding and business case, external advice and feasibility reviews
provided in November 2016 did recommend that the project would not be achievable within the original
budget allocations – with estimates given of £1.2 million. It is evident that action was taken at this point
to present the reports, with financial implications, to the Project Board to consider whether the business
case should be re-visited before proceeding. Decisions were taken to value engineer the estimated costs
and to establish a realistic, acceptable budget requirement in order to request additional monies from
Cabinet in April 2017. One action taken was to project manage the works directly, rather than employing
a project management lead, to reduce costs. Specifications for elements of the builds have been
amended to effectively achieve the deliverables but at a more ‘basic’ standard than had been previously
costed. The Council’s consultants and surveyors have also been actively engaged in negotiating and
evaluating quotations from suppliers.
The Council’s finance team have worked with project officers to establish a comprehensive budget for the
project which is enabling close monitoring against each budget line. This has enabled much greater
transparency and control over all project costs and will highlight any emerging pressures.
It should be noted that there is no allowance within the current project budget for contingency, which
clearly poses a risk to the ongoing project delivery. In any complex capital project there is potential for
unforeseen issues and costs to be incurred and without any contingency budget there is a significant risk
that there is no funding to address such issues. An allowance for contingency had been included in the
approved budget for the Children’s Centre project but has since been removed from budget forecasts in
order to balance the forecast against the funding approved. This will not represent a true saving should
any unforeseen issues arise during delivery that cannot be absorbed within the agreed project funding. As
above, there was no allowance in the approved Library project budget for contingency.
The overall project management documentation has been reviewed and it is clear that the project now
has established governance arrangements and it is evident from recent project documentation that risks
and issues are being actively identified, managed and reviewed. All actions from meetings are recorded
and change control procedures are in place. Good use is also being made of in-house professional skills
and expertise – with senior officers from Finance and Property at all Project Board/Team meetings and the
appointment of an experienced Project Manager. Specialist advice and support has also been obtained in
the form of a quantity surveyor and architects to act as agents on the Council’s behalf. These governance
arrangements will need to continue to operate robustly to ensure that any emerging pressures on the
budget are actively identified and pro-actively managed. These arrangements will also assist to ensure the
Council obtains value for money.
Lessons should be learnt for future projects that the budget setting process for capital projects must be
suitably informed and robust. It should be the responsibility of the project sponsor to ensure that budgets
which are presented for approval incorporate all costs which the Council can reasonably be expected to
incur and that sufficient initial survey work has been undertaken to ensure the project is feasible. It is also
good practice to allow for a contingency element to cover those unforeseen issues which may arise once
further surveys are conducted and work commences.
4. Detailed findings
Analysis of increased budget requirements
Budget setting – costs omitted from initial budgets
The budgets which were originally set for the two projects were developed by the Council’s Property team
which includes experienced property professionals. From review of the evidence provided, it is clear that
the original budget developed for the Library project totalled £305k but this was reduced to £220k before
it was presented to Cabinet for approval, by removing allocations for contingency and design fees and
halving the budget for temporary accommodation. Furthermore, it is evident that no feasibility studies or
surveys had been conducted before the budget figures were compiled for Cabinet approval.
Based on the analysis undertaken during this review, the costs in Table 2 had not been accounted for
within the original budgets which were approved by Cabinet (June 2016 for the Library and September
2016 for the Children’s Centre).
Table 2: Expenditure for which there was no allocation in approved budgets (based on budgets approved
in June 2016 and September 2016)
Description Spent/committed to date Current forecast total
Design fees (including architects and surveyors) £99,612 £99,867
Mechanical works for Library - £33,195
Internal decorations/alterations for Library - £16,444
Enabling works for Library £14,978 £14,978
Planning fees £3,197 £4,455
Library fixtures and fittings - £6,787
Children’s Centre move costs - £1,100
Contractor prelims - Library - £3,850
Modular build – data cabling £5,279 £5,279
IT costs - £1,000
Totals £123,066 £186,955
It would appear reasonable that these costs should have been expected given the nature of the project
and, as such, the financial implications should have been accounted for in the project budgets. As noted
above, there had been a budget originally set for design fees (of £35k) but this was removed on request
from elected members before the budget was presented for formal approval. It is understood that spend
on fixtures and fittings and shelving had also been excluded on the basis that old fixtures would be reused.
Whilst this has been followed where possible, this has not proven to be a suitable option in all cases
based on the state of some equipment. Such challenge in the initial planning stage, appears to have
resulted in additional pressure to minimise the estimated budget before presenting it for formal approval
and it is acknowledged by officers that the budget which was approved was not realistic. The project
sponsor should be responsible for ensuring that all project budgets are fully informed and robust before
seeking any formal approval.
Officers have advised that the budgets were set based on experience on other projects and estimates
based on pricing lists. As no feasibility studies had been conducted at that time, the budget setting was
not fully informed and the extent of the refurbishment and mechanical works required were unknown.
Whilst initial studies would have incurred early financial investment, this would have enabled informed
decision making from the outset of the project.
The finance team have advised that they did not receive a detailed budget breakdown until the
procurement stage had commenced. Until the procurement stage, it is understood that projected costs
had been based on average unit rates from other projects.
Budget setting – costs underestimated in initial budget setting
A failure to conduct sufficient studies at the outset of such a project presents the risk of a lack of
awareness of potential groundworks, drainage and electrical issues etc, all of which can present significant
additional costs. There is also an increased risk of uninformed estimates of costs if these are not
rigorously reviewed and subject to specialist advice at the outset. A key area of pressure on the Children’s
Centre project funding has been in relation to the cost of the modular build and the groundworks required
for its installation.
Based on evidence provided, multiple quotations had been sought in relation to the modular build but
only one formal response was received and other suppliers contacted declined to submit a quote. Officers
had provided details of the requirements including a floor plan and a topographical survey when seeking
the quotations but it became evident once the costs were further explored with the supplier that the
quote provided had not allowed for all requirements within the specification. Once amended to include
the Council’s requirements, such as glazed partitions and foundations, the quotation increased
significantly. The Council’s officers and appointed surveyors have undertaken a negotiation and value
engineering process with the supplier in order to reduce the costs but it is acknowledged that this will
reduce the quality and benefits of the final build. The higher cost designs had been based on a top
specification with top quality interiors and over engineered groundworks. Whilst the specification has
been reduced to enable affordability, the deliverable is intended to satisfy the key requirements at a more
‘standard’ level with some higher specification interior items.
The initial figure included in the approved budget for the modular build (including delivery, installation,
preliminary works, foundations, electrical and external works) was £329,950. The latest forecast, at the
time of reporting, is £519,721. This has been subject to value engineering by officers and has been
reviewed and negotiated by the consultants and agents, with the value for money being assessed by the
independent consultants. Table 3 shows the original budgets against the latest forecasts.
Table 3: Modular build original budgets and latest forecasts
Description Original budget
September 2016
Current forecast
total
Variance
against original
budget
Modular build £262,750 £245,500 £17,250
Delivery and installation £7,500 £25,000 -£17,500
Prelims, foundations and electrical £9,700 £203,780 £194,080
External works £50,000 £8,441 -£41,559
Mechanical - £37,000 £37,000
Links to library (now accounted for
under other budget lines, above)
£6,000 - -£6,000
Buggy park (now accounted for under
other budget lines, above)
£5,000 - -£5,000
Intruder and fire alarms - £9,650 £9,650
Access controls - £2,282 £2,282
Totals £340,950 £531,653 £190,203
It is understood that some early challenge from elected members in relation to the Children’s Centre
budget figures had been based on comparison to cheaper modular builds which had been used on other
sites as storage facilities – but such cheaper builds would not have satisfied the specification for the
intended use by the Children’s Centre and would not be fitting with the location.
It was also noted that the original budget had been set based on a modular build with a floor area of
150m² but before the budget was approved by Cabinet the floor area of the modular build had increased
to 200m². This amendment appears to have been applied between the initial report to the Council’s SMT
and the formal report to Cabinet in September 2016 but the budget allocation was not increased to reflect
this. As this was before the project was established there was no change control process and no evidence
to explain this change has been provided.
Unforeseen issues and costs encountered during the project
By the nature of complex capital projects, there is a risk of unforeseen problems and associated costs
arising during delivery. This is usually the purpose of the contingency budgets, to enable such issues to be
addressed as they arise.
On this project, particular issues have been encountered with the roofing of the Library building and the
Library’s electrical wiring. These issues had not been identified at the outset of the project and, as such,
insufficient funding had been allocated to cover the costs. In September 2016, following an architectural
review, an additional £60,000 was requested and approved by Cabinet based on these additional roofing
and electrical works required. The budgets and current forecast in relation to these works are provided in
Table 4.
Table 4: Financial implications of unforeseen issues
Description Original budget –
April 2016
Current forecast total Variance against
original budget
Roofing £64,000 £81,618 £17,618
Electrics – Library (including
lighting)
£33,000 £83,780 £50,780
Upgrade to electrical supply - £11,681 £11,681
Ceiling replacement - Library £18,000 £20,963 £2,963
Tank removal – change request - £963 £963
Reception desk - £2,420 £2,420
£115,000 £201,425 £86,425
It was noted during the review, that in relation to specific issues arising, such as removal of the tank, a
documented change control process has been applied and the financial implication has been logged within
the project management reports. This demonstrates an effective mechanism for managing any change in
scope and ensuring any additional spend, beyond the original business case, is formally approved and
should be enforced for all amendments to the scope throughout the delivery stages.
Value engineering and budget amendments
In order to assist in managing the financial pressures of the additional costs set out above, a number of
savings have been achieved against other budget lines and extensive value engineering has been
undertaken by officers and the consultants. The main savings currently forecast are set out in Table 5. It
should be noted that this leaves no contingency allocation for the delivery stages of the project which
could pose a risk and may not be a true saving should any difficulties arise.
Table 5: Areas of saving in latest budget forecast
Description Original budget –
September 2016
Current forecast total Variance against
original budget
Library windows and doors £21,000 £15,773 - £5,227
Asbestos removal £10,000 £6,670 -£3,330
Savings achieved on temp
accommodation for Library
£15,000 £14,362 -£636
Contingency £52,642 - -£52,642
£98,642 £36,805 -£61,835
In addition to those reduced budgets reported in Table 5, there are a number of items which have not
been commissioned or have been amended from the original specification in order to support the budget
position. The key areas are set out in Table 6.
Table 6: Items included in approved budgets, for which spend has not been incurred or forecast
Description Original budget – approved in
September 2016
Current
forecast total
Variance against
original budget
External works – gardens £36,000 - -£36,000
£36,000 -£36,000
Overall impact
The variances highlighted in Tables 2 to 6 are summarised in Table 7, to demonstrate the basis for the
overall £369,000 additional budget sought and approved by Cabinet (£60,000 in September 2016 and
£309,000 in April 2017).
It should be noted that this does not include every budget line variance but is intended to provide an
overview to demonstrate the key reasons for the main variances against the original, approved budgets.
Table 7: Overall financial implications
Description Variance against
original budget
Costs not included in original budget setting £186,955
Underestimated costs on modular build £190,203
Roofing and electrical issues £86,425
Areas of savings against original budget -£61,835
Budget lines not applied -£36,000
£365,748
Current position
At the time of reporting, delivery against the revised project budget remains a key risk and further
possible additional costs continue to arise and are being logged and discussed at Project Board. It is also
evident that much work is underway to manage the risk and mechanisms are operating to ensure the
financial implications of any changes or issues are logged and accounted for.
Additional costs have arisen since the last budget approval, including data cabling and further electrical
works, but there is evidence that a thorough review of the budget position has been undertaken, with
assistance from Finance, and a number of savings have also been identified. It should be noted, however,
that some of these savings will reduce the quality and outcomes of the project. Examples include changes
to the library shelving and lower quality materials on flooring and ramps – which are likely to reduce the
lifespan of some items and may incur further costs following the transfer to business as usual. The savings
on the change in materials for the ramp, for example, may require this to be replaced in an estimated 10
years, rather than 25 years.
Change requests and optional costs are risk assessed and the financial implications are logged. These are
presented to the Project Board for information and decisions on actions to be taken.
Based on the latest projections, which have included input from external consultants, the budget of
£989,000 remains challenging and requires ongoing close management.
Review of Project Management arrangements
Procurement and financial controls
Due to the challenging time pressures on the project delivery, formal approval has been sought for
exemptions from the Contract Procedure Rules for the key areas of procurement. The highest value
contracts are in relation to the modular build and refurbishment works, for which a formal exemption has
been approved and assurance has been given by independent legal and property professionals over the
value for money secured.
Other high value spend has included the architects and consultants who have been appointed by the
Council. Formal approval to directly appoint the architects was given in the form of a delegation by
Cabinet in September 2016. An overview of the key procurements on the project to date is provided in
Table 8.
Table 8: Key contracts on the project and procurement routes followed
Supplier Value Procurement route Notes
Portable Offices (modular build) To be confirmed
(contract not yet
signed)
Quotations sought
from multiple
companies – only
one quotation
received
Metcalfs (Library refurbishment) £303,000
Contract signed
Single tender
Exemption form
approved by key
officers and Members.
Assurances given by
independent legal
professional over
value for money
secured and
confirmation that this
was an appropriate
route to follow in the
best interests of the
project.
Weston Allison Wright
(Architects)
£30,481
to date
Directly appointed -
no alternative
quotations sought
Delegation formally
approved by Cabinet
in September 2016 to
directly appoint.
Supplier Value Procurement route Notes
FK Howard (quantity surveyors) £14,500
committed to date
Directly appointed -
no alternative
quotations sought as
each order was
valued at under
£10,000
Treated as two
separate orders, both
under £10,000.
Second phase of work
commissioned
following additional
support required.
As shown in Table 8, the key expenditure on the project has not been consistently subject to competition
but this has been formally approved via exemptions in the highest spend areas. It is also understood that
where competition has been sought there has been a limited market available. It should be noted that the
appointment of the quantity surveyors was based upon two orders, both under £10,000, but there is a risk
that this could be challenged as disaggregation of spend – given that any spend exceeding £10,000 must
be subject to multiple quotations. In this case, it would have been advisable to seek alternative
quotations or seek an exemption for the second phase of work given the need to maintain continuity with
the same supplier. Given the wider scale of the project, this is not a significant contract but is noted as an
area for improvement in transparency and competition on lower level spend.
Where key areas of expenditure have been committed this has been recorded on the financial system via
the raising and approval of a purchase order. This is in accordance with the Council’s financial procedures
and good practice to ensure that budget forecasts are accurate and any known expenditure has been
accounted for.
A thorough review and breakdown of the budget has been supported by the Finance team and this has
provided a transparent and comprehensive basis for monitoring this spend during delivery.
Governance and decision making
The Project Board includes a number of senior officers and has been meeting on a regular basis since
September 2016, with clear action points agreed. Key decisions on the project have been subject to
formal approval via Cabinet and delegations have been sought, where required, to enable progress to be
made on the project. It is noted that since December 2016 the Project Board has also included elected
members.
No evidence has been identified of any decisions made to commit expenditure outside of formal
delegations and where exemptions from contract rules have been sought there is a full audit trail readily
available.
Risk and Issue Management
There is a risk and issues log for the project which has been regularly updated and is a standing agenda
item on each Project Team meeting. Risks are also regularly discussed at the Project Board level, where
representatives from the Project Team and professional leads are present and able to contribute to the
identification and management of these risks.
The risk of budget pressures is identified within the Risk Log and assessed as a ‘red’ risk, with an action to
monitor and report spend carefully throughout the project. Where risks have been identified and logged,
it has been noted where they will be likely to incur a cost implication, albeit a value is not always stated. It
would be advisable to reflect an estimate of potential costs to ensure the impact is fully understood, given
the lack of contingency allocation.
Issues encountered on the delivery of the project are also being actively logged and monitored.
Project resources
In managing a complex capital project it is important that a suitable range of skills and experience are
involved in supporting its effective delivery. This project is benefiting from officers with professional
expertise including experienced, senior officers from Finance and Property services. Legal professionals
have also contributed on key stages of the project.
Consultants and quantity surveyors have also been appointed to provide independent, specialised input
on the review and negotiation of quotations and support project delivery.
The Finance team has been actively engaged in the project and maintain detailed commitment records
and forecast outturns.
5. LESSONS LEARNT AND NEXT STEPS
The findings of this review have been discussed with senior management and a number of lessons have
been learnt.
The review has highlighted that since the project governance arrangements have been established the
weaknesses and pressures have been highlighted and action is being taken to manage the financial
pressures. The review has particularly highlighted weaknesses in the project initiation stage which should
be addressed for any future projects to ensure that the business case and budget have been suitably
scrutinised and informed before any formal decision making takes place.
It is understood that senior management are developing a list of key areas to be addressed in light of the
findings and Internal Audit can advise on this, as appropriate.
6. LIMITATIONS TO THE SCOPE OF THE REVIEW
The Auditor’s work does not provide any guarantee against material errors, loss or fraud. It does not
provide absolute assurance that material error; loss or fraud does not exist.
Library and Children’s Centre Project – Management Response
Lessons Learnt
The review highlighted a number of areas where lessons have been learnt. The
purpose of this document is to provide assurance to the Committee that changes
have been made as a result.
The weaknesses identified by the review were mainly encountered during the project
initiation phase and can be summarised into three key areas:
1. Establishment of formal project governance arrangements
The Project Board was established in September 2016, after the formal approval of
the project. Elected Members were not invited onto the Board until later, in
December 2016.
The Project Management Framework that is now in place for all projects of this scale
and profile, requires Project Boards to be established earlier to oversee the project
initiation and feasibility work. These Boards include as a minimum the relevant
Portfolio Holder and some instances the Ward Member or a Scrutiny Representative.
2. Budget Setting
The review identified that the project was brought forward for formal approval too
soon, with the budget based on preliminary figures. Furthermore, feasibility studies
were not undertaken early enough.
The project governance arrangements that are now in place manage the risk of this
situation occurring again. A project board overseeing the initiation phase will provide
more effective challenge to the development of the plans and budget.
One issue identified by the review was that Finance were not closely involved until
the procurement stage of the Library and Children’s Centre. Project Boards include
a representative from Finance, ensuring that there is now much earlier engagement.
3. Effective challenge of proposals
There is an acceptance on the part of the management that more should have been
done to ensure that all relevant costs were included in the budget presented for
approval. It is also accepted that there should have been a more robust response to
the challenge from elected members to reduce costs. This could have been achieved
through an evidence based approach, such as feasibility studies, surveys etc.
The project governance arrangements that are now in place ensure that plans and
budgets are presented for formal approval once they have been thoroughly
scrutinised and authorised to progress. Project Boards have collective responsibility
for deciding when a project is ready to seek formal budget approval.
In addition to this, there is now monthly reporting to Strategic Management Team on
the status and risk of all corporate projects. This provides an additional layer of
challenge outside of the project boards and allows for the independent escalation of
issues.
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