Building Works Contract Award - Local democracy and decision

Officer delegated decision
Variation to Capital Maintenance Programme 2013/14 – Building Works Contract Award–
Various Schools – United House
Wards: All
Report Authorised by: Strategic Director Delivery - Sue Foster
Portfolio: Cabinet Member Children & Families: Councillor Imogen Walker
Contact for enquiries:
[email protected]
Alfred Akpo-Teye, Programme Manager, BGR
Report summary
This waiver report seeks retrospective approval for the variation of the contract for the Capital
Maintenance building works contract with United House Ltd, to the value of £223,652.99.
United House are currently carrying out urgently required building maintenance and repair
works at various schools in the Borough as part of the ongoing Capital Maintenance Programme
2013/14 and 2014/15. The works range from window replacement to sanitary services renewal,
and are all urgently required works that risk the health & safety standards required at the
schools.
The Council has secured capital grant allocations from the Department of Education for
2013/14 and 2014/15. The expenditure associated with these capital allocations can be slipped
into 2015/16. Works are now almost complete for the 2013/14 programme. Instructions were
issued and implemented for additional work to most schools in the 2013/14 programme. Two
schools in the 2014/15 programme have had specific packages prioritised and brought forward
into the 2013/14 programme due to the urgent requirement to address the issues. The variation
to meet this requirement is £223,652.99.
The existing contract has a client held contingency which will not be utilised for this variation at
the current time. The purpose of this client contingency is to address unforeseen issues that
have not been identified in non-intrusive surveys to date.
Financial summary
The funding for this project is reported within the Capital Projects Investment Programme. The
overall available allocation for the capital maintenance programme is £5.2m, and is being
phased over 2 years – (2013/14; 2014/15). The current available allocation for the capital
maintenance programme is £3.2m out of which £2.5m has been spent and committed to date.
The subject of this report is a variation to the works package for the first year of the programme
which is underway. The additional works which have been brought forward were originally
planned for the second year of the current programme. This increases the contract for this
2013/14 year, whilst not jeopardising the overall programme budget or prioriotised works for the
2014/15 programme.
The corresponding project code is 912440, of which there is sufficient funds within to cover the
additional amount of £223,652.99 required for this award.
Recommendations
1. To note the variation to the contract with United House Ltd for the Capital Maintenance
Programme 2013/14 Building Works for the sum of £223,652.99.
2.
Context
2.1
The Capital Maintenance Programme Building works project forms part of the current
Capital Maintenance Programme, which is designed to carry out essential maintenance
and repairs to schools across the Borough. Additional urgent works have been identified
so as to address serious disrepair, ensure continued delivery of the curriculum in the
schools identified and ensure that the cost of identified defects do not escalate.
2.2
Having previously appointed Potter Raper Partnership as the technical consultant for the
Building works section of the 2013/14 and 2014/15 programme, they were engaged to
carry out detailed feasibility surveys of all the schools identified within the Building works
section of the programme. These compared condition data held on the asset
management database (Technology Forge) against current condition. Works were
identified as urgently required where areas are in serious disrepair and and at the end of
their useful life. These items, if left unaddressed, would require constant and expensive
regular maintenance and would also lead to health and safety issues.
2.3
The urgent building works being undertaken help to support the delivery of the
Community Plan 2013-16. These works will provide for improved school facilities,
making them a more efficient and safer enviroments and improving the ability for “All
young people to have opportunities to achieve their ambitions.
2.4
The imperative to carry out these works means that officers are seeking an exemption
from contract standing orders. A waiver is therefore being sought from contract standing
orders based on a combination of ‘urgency’ and ‘demonstrable best value’
2.5
This is a Gateway 3 waiver report.
3.
Proposal and Reasons
3.1 Due to the additional urgent works (variations) identified within the on-going 2013/14
programme with United House, and the need to bring forward works that were originally
planned for 2014/15, a revised works package for this current year’s allocation has been
finalised. The contract with United House has increased by £223,652.99 from
£1,424,962.00 to £1,648,614.99. The revised completion date for the associated
building works programme is now 17th April 2015.
3.2
This is the second variation for this contract. The first variation for £266k was for the
2013/14 programme delay and associated costs. Original contract was for £1,158,067.00
and this increased from £1,158,067.00 to 1,424,962.00 due to associated Programme
Variation costs to delays to mobilistaion. This is now increasing to £1,648,614.99 for
repropgrammed and additional works.
3.3
The
cost breakdown
for the revised 2013/14 programme including the
instructions/variations to on-going works and the two new additional schools in the
2014/15 programme are detailed within the appended report from Potter Raper
Partnership, the Authority’s representative.
3.4
United House are best placed to deal with the extra works set out, having works already
on site saving on pre-liminary costs in some cases and providing value for money. They
are well versed with the schools in question and the costs are in line with the original
tender. The option to vary the current contract with United House represented the most
appropriate means for procuring the additional works. The Council are able to benefit
from pre-tendered rates from the substantive tender, a contract that is fit for purpose and
the facility for United House to progress with the remedial works with urgency. Potter
Raper Partnership have conducted an appraisal of the variations costs and confirmed
that the variation proposal represents value for money.
3.5
A waiver from standing orders is therefore sought based on a combination of urgency
and demonstrable best value to vary the existing contractual arrangement with United
House to carry out the adidtional urgent remedial work.
4.
Finance
3.1
The funding for this project is reported within the Education Estates Capital Projects
Investment Programme. The overall available allocation for the capital maintenance
programme is £3.2m. The programme has been phased between the financial years
2013/14 and 2014/15. The corresponding project code is 912440. The variation for this
award is £223,652.99. There are sufficient funds available within the £3.2m assigned to
deliver the Capital Maintenance works to cover this additional amount needed.
5.
Legal and Democracy
5.1
Where authorisation is sought for a substantial variation of an existing contract it should
be treated as a waiver of the Council’s Contract Standing Orders. The level of delegated
authority for approval is based on the total value of the variation, not the original contract
value. The authority to approve a waiver for variations valued at between £100,000 and
£500,000 is reserved to the Strategic Director, Delivery, following recommendation by
the Procurement Board.
5.2
The Council’s Contract Standing Orders sets out the rules and procedures for all
purchases of goods, services and works. For all contracts over £100,000, there is a
requirement to hold formal tenders and to ensure that all tenderers have the economic
and financial standing, technical ability and resource capacity to fulfil the requirements of
the authority. The proposed variation seeks to increase the value of a contract which
was procured by competitive tender through Construction Line. Waivers of the
requirement to further tender the additional works may be granted in circumstances
where the requirement is urgent and demonstrably in the Council’s best interests, which
the authors have explained apply to this contract.
5.3
Under the regulations, contracting authorities must comply with the Public Contracts
Regulations 2006 and publish a contract notice in OJEU only if the estimated value of
the works contract exceeds £4,322,012. In this case both the original contract and the
value of the variation singly or together are below the threshold
5.4
The Council’s Constitution requires that all key decisions, decisions which involve
resources between the sums of £100,000 and £500,000, and important or sensitive
issues, must be published on the website for five clear days before the decision is
approved by the Director or Cabinet Member concerned. Any representations received
during this period must be considered by the decision-maker before the decision is
taken.
6. Consultation and co-production
6.1
7.
All the schools remain supportive of the works being carried out and the schools
involved continue to be consulted through regular written updates, progress meetings
and communications with the Head Teachers and their nominated representatives.
Risk management
A risk log has been maintained of the main risks associated with this procurement. The
main risks are set out in the table below. Officers have put in place sufficient measures
for to minimise the likelihood and impact of these risks being manifested.
Risk
Risk
Rating
Countermeasure
Project does not deliver to the
aspirations of the stakeholder
Medium
Full understanding of aims and
objectives outlined at commencement
of project. Roles and responsibilities
aspirations defined and agreed with
school.
Changes to the design brief
during works due to unknowns
that cause increase to cost and
programme
Medium
Allow client held contingency to cover
additional items. Build in additional
time contingency to programme.
None availability of specified
equipment and long delivery
times.
Low
Ensuring that works contract is
awarded as soon as possible to allow
enough time for sourcing and ordering
of equipment.
Discovery of unknown asbestos
Medium
Sufficient risk assessment undertaken
with detailed method statements in
place to enable correct working
methods of removal.
Carry out
additional surveys by specialist
company to update records.
Activities arranged by Schools
that effect running of works
contract
Low
Sufficient consultation with schools as
to works programme. Agreements in
place with schools.
Health & Safety risks and issues
for construction site operatives
and staff during the construction
phase.
Medium
The Contractor must provide a
Construction Health & Safety Plan to
be in place before works commence
on site.
The contractor must ensure sufficient
supervision, instruction and training
and carry out a Risk Assessment to
be provided to the lead consultant
before works commence on site.
The CDM Co-ordinator must ensure
that the Health & Safety Plan is kept
up to date. Accident reporting and
RIDDOR records should be provided
at the bi-weekly site meetings.
The contractor must make proper
arrangements for welfare facilities and
organise
site
inspections
in
accordance with health & Safety
legislation.
Contractor does not perform as
required
per
contract
to
programme and cost.
Medium
Close management of contract by the
appointed contract administrator and
Client PM to ensure contractor
delivery. Liquidated damages in place
to recoup contracted client % costs.
8.
Equalities impact assessment
8.1
An equalities impact assessment has been carried out for the programme of works on
the Primary Schools and this has been rated as ‘LOW’.
9.
Community safety
9.1
While work during the school hours naturally creates additional H&S risk, the
construction will be safeguarded against children accessing the site though effective site
management and full conusltation and liaison with the school staff. There are no further
community safety implications, and the project is directly addressing the urgently
required works at the schools which if not done could lead to an increased ongoing risk
of safety issues at the schools.
10.
Organisational implications
None
10.1
Environmental
The works specified within this contract are essential building maintenance works and
are urgently required. The improvement works will reduce the need for constant repairs,
improving and extending the life of the fabric of the schools. It will mean more efficient
use of the school buildings, providing benefits in the short, medium and long term.
10.2
Staffing and accommodation
There are no direct Staffing implications, but the improvements to the accommodation
will benefit all users, making the school facilities a safer and much improved
environment.
Procurement
9.3
There is no GW2 Strategy report for this project, and therefore this paper is submitted as
a waiver report.
A paper based tendering exercise was carried out for this project for the original award.
Contract variation would ensure continuity of supply.
9.4
Health
None
10
Timetable for implementation
10.1
The table below shows the stages, milestones and deadlines for the implementation of
this ongoing contract.
#
1
2
3
4
5
6
7
Item Description
Cabinet Member Briefing
Procurement Board Approval Main Contract
Contractor Appointed
Works started on site
Procurement Board Variation (this report)
Practical Completion
End of defects period and release of retention sums
Date
March 2014
May 2014
June 2014
July 2014
26th March 2015
May 2015
May 2016
Audit trail
Consultation
Name/Position
Mike Pocock / Delivery
Director – Business Growth &
Regeneration
Lambeth
cluster/division or
partner
Business Growth &
Regeneration
Date Sent
Date
Received
Comments in
para:
20/02/15
08/02/15
Throughout
Sue Foster / Strategic
Delivery Director
Alan Fleming / Programme
Director
Peter Dawes / Commercial
Manager
Finance clearance
Business Growth &
Regeneration
Business Growth &
Regeneration
Business Growth &
Regeneration
Business Partnering
David Thomas, Legal
clearance
Democratic Services
clearance
Departmental Procurement
Procurement Board
09/02/15
11/3/14
Throughout
16/02/15
16/02/15
Throughout
17/02/15
20/02/15
Throughout
16/02/15
24/02/15
Enabling: Integrated
16/02/15
Support: Legal Services
Enabling: Corporate
16/02/15
Affairs: Democratic
Services
Enabling
16/02/15
Date of Meeting
tbc
18/02/15
3 & Financial
summary
4
17/02/15
4
Report history
Original discussion with Cabinet Member
26/02/15
CMB 25/03/14
Report deadline
Date final report sent
Report no.
Part II Exempt from Disclosure/confidential
accompanying report?
Key decision report
Date first appeared on forward plan
Key decision reasons
N/A
N/A
N/A
NO
Background information
Original ODDR reports for Main Contract and
Previous variation
NO
N/A
Appendices
Appendix 1: Statement for final account from
Potter Raper Partnership
I confirm I have consulted Finance, Legal, Democratic Services and the Procurement
Board and taken account of their advice and comments in completing the report for
approval:
Signature ______________________________________ Date ________________
Post Allan Woodcock, Assistant Project Manager, BGR
I approve the above recommendations:
Signature ______________________________________ Date ________________
Post Sue Foster,Strategic Delivery Director