News: "Not acceptable" - council's incapability to control capital costs can't continue
Frank discussions have been held between elected members and council officers over large capital regeneration projects in Rotherham that keep going over budget.
A wide ranging review of how council-led projects are managed is set to take place as the authority wrestles with its largest ever capital investment programme having secured millions in funding for regeneration,
It comes after the cabinet approved a further £8m, including using various council pots to fill a funding gap following an increase in the total budget of the town centre markets and library redevelopment from £40.894m to £46.844m. The request for another £5.95m is a year after the council secured a further £6.5m from the South Yorkshire Mayoral Combined Authority (SYMCA) to cover previous budget increases.
Cllr. John Williams, Cabinet Member for Transport, Jobs and the Local Economy, said that he was "extremely frustrated and disappointed" that the town centre project was back before cabinet seeking further financial support.
Cllr. Williams told fellow cabinet members: "As part of some of the very frank discussions that myself and the leader [Cllr. Chris Read] have been involved in with senior officers, we have made it absolutely clear that this is not acceptable and that things need to improve in the delivery of big capital projects. The first step of that journey in terms of making that improvement is to be open and honest and transparent about the issues that have occurred.
"I am pleased that this report is set out in the way that it is. It is quite a frank and direct read, quite a difficult read in places, but I'm pleased we've taken that step."
In a series of challenges in the delivery of the project, the cabinet report highlighted an increase in demolition costs, inflationary increases linked to delays with extended periods of clarifications and amendments, and "an overestimation of project readiness" when the contract was awarded.
Williams added: "The issues clearly raise significant questions on both the original designs, on the project and cost management of the project, and on internal governance overseeing the delivery of this scheme."
The council's chief executive is commissioning an investigation into the markets and library project and recently told councillors that he is also set to conduct a separate independent "end-to-end review of the capital project processes with a focus on large-scale development projects with a view to identifying learning and developing recommendations on how to embed best practice going forward."
John Edwards, chief executive at Rotherham Council, said: "I'm looking at how can we improve and how can we look across. I'm looking to an independent external organisation, perhaps another local authority, to look at the process we have in that space and help us to develop the very best of practice going forward.
"We have lots of skilled staff across the council but there is no doubt that a stronger culture and process is necessary in order for us to enter into, and then see through, major projects effectively, in a timely way, and within budget."
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Simon Moss, Director of Regeneration and Environment at Rotherham Council, added that there had already been significant improvement in project and programme management in recent years. He said: "We've established new gateway processes, there's been lessons around contractual approaches and routes to market, and also around empowering the project manager and project sponsor to ensure that control and influence on key project decisions are aligned closely to those that are accountable to the project.
"On this particular project [the town centre markets and library], unfortunately some of the challenges were fundamentally "baked in" already and improvements since then have helped to identify and mitigate some of those issues, unfortunately rather than eradicate them, but I can offer my own assurances that significant lessons have been learnt and are being employed on other projects which we are seeing successfully delivered across the borough."
Cllr. Chris Read, leader of the council, said: "There will be people who are unhappy, angry about the cost, and worried about what that means for the scheme. The first thing to say, just to reiterate again, of course we cannot continue to spend bigger and bigger amounts of money on these capital schemes, that isn't acceptable to us, and it isn't acceptable to the taxpayer, and none of us should stand for it. So the decision that we are taking, today - this is not a blank cheque but it is the money that is necessary to bring them to fruition. We will ensure that those town centre schemes are delivered.
"The library should be open later this summer, so people should be able ti use those new facilities, and goodness knows we've waited something like 15 years for the library to be relocated back into the town centre so we'll deliver on that. The first stage, the market hall, should be operational in the coming months and we will make sure that that work is done.
"If we were to stop now we would leave ourselves with a half-completed project in the middle of town that would at some stage in the future require even more money to get back into some sort of good use, and we won't stand for that. Without investment in that markets complex that building would have come to the end of its natural life, it would have closed and hundreds of years of Rotherham as a market town would have come to a conclusion and we are not going to accept that either.
"The investigation is also really important. It is important that the council learns the lessons of the mistakes that have been made, that improvements are made in the way that major projects are organised, because, frankly, otherwise the taxpayer and this cabinet will once again be put in a position of not being able to rely on the information that is put in front of us. And that undermines us and it undermines the democratic process, and it means that we will not be able to do our best for our borough."
Images: Henry Boot Construction / LinkedIn
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A wide ranging review of how council-led projects are managed is set to take place as the authority wrestles with its largest ever capital investment programme having secured millions in funding for regeneration,
It comes after the cabinet approved a further £8m, including using various council pots to fill a funding gap following an increase in the total budget of the town centre markets and library redevelopment from £40.894m to £46.844m. The request for another £5.95m is a year after the council secured a further £6.5m from the South Yorkshire Mayoral Combined Authority (SYMCA) to cover previous budget increases.
Cllr. John Williams, Cabinet Member for Transport, Jobs and the Local Economy, said that he was "extremely frustrated and disappointed" that the town centre project was back before cabinet seeking further financial support.
Cllr. Williams told fellow cabinet members: "As part of some of the very frank discussions that myself and the leader [Cllr. Chris Read] have been involved in with senior officers, we have made it absolutely clear that this is not acceptable and that things need to improve in the delivery of big capital projects. The first step of that journey in terms of making that improvement is to be open and honest and transparent about the issues that have occurred.
"I am pleased that this report is set out in the way that it is. It is quite a frank and direct read, quite a difficult read in places, but I'm pleased we've taken that step."
In a series of challenges in the delivery of the project, the cabinet report highlighted an increase in demolition costs, inflationary increases linked to delays with extended periods of clarifications and amendments, and "an overestimation of project readiness" when the contract was awarded.
Williams added: "The issues clearly raise significant questions on both the original designs, on the project and cost management of the project, and on internal governance overseeing the delivery of this scheme."
The council's chief executive is commissioning an investigation into the markets and library project and recently told councillors that he is also set to conduct a separate independent "end-to-end review of the capital project processes with a focus on large-scale development projects with a view to identifying learning and developing recommendations on how to embed best practice going forward."
John Edwards, chief executive at Rotherham Council, said: "I'm looking at how can we improve and how can we look across. I'm looking to an independent external organisation, perhaps another local authority, to look at the process we have in that space and help us to develop the very best of practice going forward.
"We have lots of skilled staff across the council but there is no doubt that a stronger culture and process is necessary in order for us to enter into, and then see through, major projects effectively, in a timely way, and within budget."
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Simon Moss, Director of Regeneration and Environment at Rotherham Council, added that there had already been significant improvement in project and programme management in recent years. He said: "We've established new gateway processes, there's been lessons around contractual approaches and routes to market, and also around empowering the project manager and project sponsor to ensure that control and influence on key project decisions are aligned closely to those that are accountable to the project.
"On this particular project [the town centre markets and library], unfortunately some of the challenges were fundamentally "baked in" already and improvements since then have helped to identify and mitigate some of those issues, unfortunately rather than eradicate them, but I can offer my own assurances that significant lessons have been learnt and are being employed on other projects which we are seeing successfully delivered across the borough."
Cllr. Chris Read, leader of the council, said: "There will be people who are unhappy, angry about the cost, and worried about what that means for the scheme. The first thing to say, just to reiterate again, of course we cannot continue to spend bigger and bigger amounts of money on these capital schemes, that isn't acceptable to us, and it isn't acceptable to the taxpayer, and none of us should stand for it. So the decision that we are taking, today - this is not a blank cheque but it is the money that is necessary to bring them to fruition. We will ensure that those town centre schemes are delivered.
"The library should be open later this summer, so people should be able ti use those new facilities, and goodness knows we've waited something like 15 years for the library to be relocated back into the town centre so we'll deliver on that. The first stage, the market hall, should be operational in the coming months and we will make sure that that work is done.
"If we were to stop now we would leave ourselves with a half-completed project in the middle of town that would at some stage in the future require even more money to get back into some sort of good use, and we won't stand for that. Without investment in that markets complex that building would have come to the end of its natural life, it would have closed and hundreds of years of Rotherham as a market town would have come to a conclusion and we are not going to accept that either.
"The investigation is also really important. It is important that the council learns the lessons of the mistakes that have been made, that improvements are made in the way that major projects are organised, because, frankly, otherwise the taxpayer and this cabinet will once again be put in a position of not being able to rely on the information that is put in front of us. And that undermines us and it undermines the democratic process, and it means that we will not be able to do our best for our borough."
Images: Henry Boot Construction / LinkedIn
