Frameworks Scotland Three Years In

Jacqueline KilcoyneCapital Projects ManagerHealth Facilities Scotland

Introduction to Framework

Framework Objectives

Overview of Current Position

Outcomes

Going Forward

Frameworks Scotland is a strategic partnering approach to the procurement of capital schemes across NHSScotland with a value in excess of £1m.

PSCP Framework

BAM

Laing O’Rourke

Interserve

Morrison Healthcare

Robertson Dawn Health

Professional Services Frameworks:-

Project Manager Cost Advisor Supervisor CDM Co-ordinator Healthcare Planner

NHS Partnering Workshop –

April 2007Difficulties Expressed and Discussed included:• Increased construction costs and cost uncertainty• Construction market saturation• Difficulty attracting bidders/collating tender lists• Programme delays• Drive to improve quality of capital schemes• Paying more for their project than they had been led to

believe would be the case when they accepted the contractor’s tender

• Receiving their project late• Taking ownership of buildings which fail to meet the

functional requirements of the users, and• Ending, all too often, with an adversarial and litigious

relationship with the chosen contractors

Aims and Objectives of the Proposed Framework

Improvements in design Improved quality Improved client satisfaction Improved Health and Safety performance Sustainability Retain, recruit and train a skilled workforce Reduce procurement and lead in times by at least 3 months Cost efficiencies A Framework for professional services Appointment of a minimum of 3 (maximum of 5) ‘One stop shop’ PSCPs

▪

41 Projects

18 Complete15 On site8 In development

▪

£386 million

▪

12 Boards

Frameworks Scotland – A National Framework

Frameworks Cash Flow

Frameworks Scotland Projected Spend October 2011

0

65,932,643

144,114,071

47,401,141

2,115,00013,577,654

135,513,487

0

20,000,000

40,000,000

60,000,000

80,000,000

100,000,000

120,000,000

140,000,000

160,000,000

2009 / 2010 2010 / 2011 2011 / 2012 2012 / 2013 2013 / 2014 2014 / 2015 2015 / 2016Year

Valu

e £m

NHS Highland –

New Migdale

Hospital, Bonar Bridge

NHS Lanarkshire –

Monklands

Hospital

NHS Greater Glasgow and Clyde –

A&E Expansion, Glasgow Royal Infirmary

NHS Grampian –

Whinhill

Medical Practice

NHS Dumfries and Galloway –

Crichton Midpark

Hospital, Dumfries

Frameworks Scotland Audits –

PSCP

Carried out by PriceWaterhouseCoopers

PSCP Head Office audit and project audit

Financial systems and procedures are effective

Costs allocated correctly

Overall positive and successful audits

Frameworks Scotland Audits -

PSC

Carried out by PriceWaterhouseCoopers

PSC Head Office audit

Hours charged related to underlying records.

Rates charged were contract rates.

Overall positive and successful audits

Cost Analysis of Frameworks Projects

10 completed projectsTarget price £1.5 - £4.5m

3 projects in constructionTarget price £21m, £35m, £81m

Initial Report

Key Trends and Value for Money

Analysis of Frameworks Projects Key Trends and Value for Money

BREEAM

Limitations of data- 3 projects achieving ‘Excellent’ rating - 2 projects achieving ‘Very Good’ rating

Recognised percentage increases (BRE)- Excellent 3.3% - 7.0% increase in Capital Cost- Very Good 0.1% - 5.7% increase in Capital Cost

Framework Projects - BREEAM Excellent 1-4% - BREEAM Very Good <1%

Analysis of Frameworks Projects Key Trends and Value for Money

Programme

Traditional (Completed Projects)- Less than 50% of projects analysed

finished on programme

Framework- 8 out of 10 projects finished on time- 3 further currently on programme

Analysis of Frameworks Projects Key Trends and Value for Money

Refurbishment (within live hospital environment)

Average cost per m2 £1,500 for Framework projects compared with £1,900 for traditionally procured projects

Influencing Factors

1. Risk – Effective risk management and ownership.

2. Recognition of market conditions 3. PSCP/Supply Chain involvement

Analysis of Frameworks Projects Key Trends and Value for Money

New Build

1. Health Centres Centres -- like for likelike for like

2.2. Dental Centres Dental Centres –– VariedVaried

Contributing factors include:-

- Remote location - Size of project- Abnormals - extensive car parking

- foundation design

3. Mental Health - Comparable

4. Care of the Elderly - Marginally less than average - equates to

£1.1m saving

Analysis of Frameworks Projects Key Trends and Value for Money

Pain Gain Share

£172,871 £654 £59,106 £242,637 £210,531

£118,597 £9,469 (£156,781) £152,111 £60,476

£1,1

78,5

75

£667

,718

£27,

515

Objectives Improved Quality

Feedback from recent Users event indicated improved quality.

- end product & project management - minimal / no defects- end users aspirations - maintain ongoing healthcare delivery needs.

Objectives

Client satisfaction

Very positive feedback at Users event for both the process and end product.

- team solution - working relationships - Risk management and allocation

Average KPI score of 78% for most recent quarter

Objectives

Reduced Procurement Times

- PSCP appointment in 4 weeks has reduced appointment timescales.

- Early constructor involvement has reduced risk and assisted project planning.

Objectives

Cost Efficiencies

- Initial Cost Analysis Report has demonstrated efficiencies.

- Cost certainty through the programme noted by users as being a priority.

Objectives

- Feedback that NHSScotland Boards consider Health & Safety performance has improved.

- Most recent KPI result average score of 83% for satisfaction for Health & Safety on site management and commitment.

Objectives

Improvements in design

- Most recent KPI for results for overall NHS satisfaction with design is 82%.

Going Forward

• End of Year 3 of 4 year Framework (with option to extend for 2 years).

• Consultation with Key Frameworks Scotland Users.

• Consultation with Welsh Health Estates.• Consultation with NHSScotland Boards. • Ongoing consultation with Legal Advisors

around maximising the use of the Framework.

Going Forward

- Strategic Programmes of Work

Refurbishment

Backlog Maintenance

Risk Reduction

Going Forward

Improve - Not stand still - Share best practice

Across the Framework - Collaboration and team approach- Deliver efficiencies

Scottish Spending Review 2011 & Draft Budget 2012

Managing Pressures and Cuts in Public Expenditure

“….there will require to be an ongoing focus on delivering efficiency savings and increasing productivity building on past success. The Scottish Government is delivering a number of initiatives to ensure that available resources are utilised as effectively as possible. The Frameworks Scotland national construction framework will ensure efficient delivery of new and refurbished projects”.