REPORT TO:

Cabinet Member Technical Services Cabinet

DATE:

23rd September 2009

1st October 2009

SUBJECT:

Thornton Switch Island Link Commissioning Report/Revised Project Management/Programme & Scheme Cost Profile

WARDS AFFECTED:

Park, St Oswald, Netherton and Orrell, Molyneux, Manor, Sudell

REPORT OF:

Andy Wallis Planning & Economic Regeneration Director

CONTACT OFFICER:

Stuart Waldron Assistant Director 0151 934 4006 Stephen Birch Team Leader STPU 0151 934 4225 Nigel Wilkinson Assistant Director Capita Symonds 0151 934 4243

EXEMPT/ CONFIDENTIAL:

N/A

PURPOSE/SUMMARY: To advise Members of the receipt of a satisfactory Commissioning Report for Phase 1 of the ECI Contract for the Thornton Switch Island Link Scheme, approve revised Project Management arrangements, and note a revised programme and a Scheme Cost Profile.

REASON WHY DECISION REQUIRED: To keep Members fully appraised of progress and to seek approval to key project management arrangements to meet the Department for Transport requirements.

RECOMMENDATION(S): Cabinet Member Technical Services: - Notes the report and supports the recommendations to Cabinet. Cabinet: - Members note the submission of the Commissioning Report in accordance with the Contract. - Members note the partnering arrangement established for the effective delivery of the scheme. - Cabinet approve the revised Project Management arrangements and Project Board for the scheme. - The duties and responsibilities of the Contract Project Manager be delegated to the Assistant Director (Transportation & Development) Planning & Economic Regeneration Department. - Members note the revised programme for the scheme. - Members note the revised spend profile for the scheme.

KEY DECISION:

No

FORWARD PLAN:

No

IMPLEMENTATION DATE:

Following the expiry of the ‘call in ‘period for the minutes of the meeting

ALTERNATIVE OPTIONS:

IMPLICATIONS:

Budget/Policy Framework:

The budget remains as previously approved by Cabinet in May 2007, and included in the approved Capital Programme.

Financial: This is for a Sefton Council contribution of up to £5.912m, to a total scheme cost of £21.4m

CAPITAL EXPENDITURE

2006/ 2007 £

2007/ 2008 £

2008/ 2009 £

2009/ 2010 £

Gross Increase in Capital Expenditure

Funded by:

Sefton Capital Resources

Specific Capital Resources

REVENUE IMPLICATIONS

Gross Increase in Revenue Expenditure

Funded by:

Sefton funded Resources

Funded from External Resources

Does the External Funding have an expiry date? Y/N When?

How will the service be funded post expiry?

Legal:

N/A

Risk Assessment:

"Based on the project plan, full scheme approval will not be until December 2011. Current expectations are that the scheme will receive full approval in due course. However, there is a risk that the scheme may not receive full approval. In this event any costs incurred by the Council may be classed as abortive. Capital accounting rules require that abortive costs are charged to revenue which would require them to be funded from General Fund balances."

Asset Management:

N/A

CONSULTATION UNDERTAKEN/VIEWS FD 153– The Finance and Information Services Director has been consulted and his comments have been incorporated into this report.

CORPORATE OBJECTIVE MONITORING: Corporate Objective

Positive Impact

Neutral Impact

Negative Impact

1 Creating a Learning Community 4

2 Creating Safe Communities 4

3 Jobs and Prosperity 4

4 Improving Health and Well-Being 4

5 Environmental Sustainability 4

6 Creating Inclusive Communities 4

7 Improving the Quality of Council Services and Strengthening local Democracy

4

8 Children and Young People

4

LIST OF BACKGROUND PAPERS RELIED UPON IN THE PREPARATION OF THIS REPORT Cabinet Report – 14

th May 2009 – Thornton to Switch Island Link Acceptance of Early Contractor

Involvement Tender Cabinet Member Technical Services - 25

th March 2009 – 2009/10 Local Transport Plan Capital

Programme

1.0 Background

1.1 Cabinet on the 14

th May 2009, approved the award of an Early contract Involvement (ECI)

contract to design, develop and construct the Thornton Switch Island Link scheme to Balfour Beatty Civil Engineering Ltd. The contract includes Balfour Beatty’s partnership with Jacobs as design engineers. The official contract award date was 23 June 2009.

1.2 The client management of the scheme is through the Planning and Economic Regeneration Department Strategic Transportation Planning Unit with Capita Symonds engaged as the Client’s Agent to provide the client with technical and project management support.

1.3 As indicated in the Cabinet report on the 14 May 2009, the contractor must provide a Commissioning Report. This was submitted on the 22

nd July 2009, and provides details on

programme, scheme costs and governance arrangements.

1.4 The purpose of this report is to seek approval to: - Acknowledge receipt of the Commissioning Report in accordance with the Contract. - Note the Partnering Charter developed to promote the effective and efficient delivery

of the project. - Revised Governance arrangements now a Contractor/Design Consultant has been

appointed with Capita Symonds appointed as Client’s Agent. - Revised Programme and Funding Profile.

2.0 Commissioning Report

2.1 The contract is split into two phases: Phase 1: Period from the Contract Date to the issue of Notice to Proceed to Construction further to DfT full approval. The Phase is further divided as: Phase 1A: The period from the Contract Date to the publication of Draft Orders/Submission of Planning Application. Phase 1B: The period from publication of Draft Orders to the issue of the Notice to proceed to construction. Phase 2: The period from the issue of the Notice to Proceed to Construction to the issue of the Completion Certificates for the Works by Sefton Council.

2.2 The purpose of the Commissioning Report is to outline the proposed methods that the project team intend to use in the execution of the Contract during primarily Phase 1, with indication/outline proposals for Phase 2. The project team comprises of: Balfour Beatty, Jacobs, the Council as Client and Capita Symonds as Client’s Agent.

2.3 The report contains: - A detailed assessment and methodology to be used in preparation of all aspects of

the design; - Methodology on how the target costs will be prepared; - A review of the existing survey information and proposals for further data collection;

- An assessment of the need for further consultations; - A programme for Phase 1 with an explanation of the assumptions; - An outline programme for Phase 2; - An explanation of the basis on which the programme has been prepared; - Proposals for staff resources and the use of sub-contractors to deliver Phase 1 - A financial programme for Phase 1, and; - A risk register. A similar report will be required at the commencement of Phase 2.

2.4 The draft report was submitted by Balfour Beatty on the 22nd July 2009. Further to comments

and amendments by the Client/Capita Symonds a final version was approved by the Project Board on the 8

th September 2009.

2.5 The full report has not been appended to this report, but is available for inspection by

members on request.

2.6 Partnering Charter

2.7 The ethos and purpose of entering into Early Contractor Involvement for the design and build of the scheme is to encourage the efficient and timely delivery of the scheme through effective partnership working across the range of roles and responsibilities of the Contractor/Design Engineers and the Client/Client’s Agent involved.

2.8 An initial Partnering Workshop was held on the 15th July 2009, from which a Partnering

Charter has been developed and agreed by all involved. This will form the basis to monitor and assess the effectiveness of the partnership during the progress of the scheme. The approved Partnering Charter is attached as Annex A for information.

2.9 Cabinet Member Technical Services took the opportunity to attend part of the workshop to meet key members of the project team.

2.10 Recommendation - Members note the submission of the Commissioning Report in accordance with the Contract. - Members note the partnering arrangement established for the effective delivery of the scheme.

3.0 Governance arrangements

3.1 Cabinet Member Technical Services and Cabinet on the 31st January 2007 and 8

th February

2007 respectively approved an Approval Process and Project Management Arrangement for the scheme.

3.2 The project management arrangements included were applicable to delivering the Business Case for DfT Programme Entry and subsequent award of an ECI Contract to design and construct the scheme.

3.3 As part of the Business Case the Council had to demonstrate effective project management arrangements would be put in place. Proposals were developed in accordance with The Office of Government Commerce (OGC) Project Management Methodology “Managing

Successful Projects with Prince 2” which is recognised by the Department for Transport and already used within the Council. This requires management levels and key responsibilities to be formally recognised.

3.4 The methodology requires the formation of a Project Board to direct and control the project within the requirements of the Council’s Constitution and formal approval processes.

3.5 The Project Board established to proceed to Programme Entry was made up of appropriate Council Officers, however with the award of the ECI Contract, certain roles need to be undertaken by the Contractor/Design Consultant and Capita Symonds. Consequently, a revised Project Board structure is proposed in Annex B.

3.6 The Board will be made up of senior key representatives from agencies/organisations involved and a Senior Council Representative will continue to chair and manage the Board. To ensure best use is made of expertise throughout the organisations, key members of the Core Teams (i.e. staff from the Council/Balfour Beatty/Jacobs and Capita Symonds) that are responsible for the day to day delivery of the work programme have been identified and will support the Project Board as required.

3.7 3.8

The Council’s Finance Department have been involved in the Project Management process, but as the scheme has now moved forward to the delivery stages, a representation from the Finance Department will be included in the Project Board. The Project Board will generally meet on a quarterly basis,

3.9 Under the formal contract the Contract Project Manager is designated as the Deputy Chief Executive and Strategic Director of Regeneration & Environmental Services. To facilitate the effective day to day management of the contract it is proposed to delegate the responsibilities of the Contract Project Manager to the Assistant Director (Transportation & Development) Planning and Economic Regeneration Department. Within established formal reporting arrangement, senior managers and Members will be fully appraised of progress and consulted on key decisions.

3.10 Recommendation i) Cabinet approve the revised Project Management arrangement and Project Board for the scheme. ii) The duties and responsibilities of the Contract Project Manager be delegated to the Assistant Director (Transportation & Development) Planning & Economic Regeneration Department.

4.0 Scheme Programme

4.1 For the Commissioning Report the Contractor/Design consultant has reviewed the scheme programme overall. The following key programme dates have been agreed:

Key Deliverable

Phase 1

Date

Commissioning report Complete Preliminary Design Public Exhibition Acceptance of Environmental Statement/Revised Economic Assessment Submit Planning Application/Draft Statutory Orders Complete (Completion of Phase 1A) LPA Consideration of Planning Application Period for Public Inquiry – Planning Appln/Statutory Orders Inspectors/Secretary of State Decision Revised Business Case to DfT Complete Design Contract for Construction DfT Approval to Proceed (Completion of Phase 1B)

22 July 2009 December 2009 February 2010 March 2010 1st April 2010

July 2010 January 2011 June 2011 September 2011 December 2011 December 2011

Phase 2 Commence Construction Scheme Open to Traffic

February 2012 November 2012

Comments i) The Public Exhibition in February 2010 has been proposed by the Contractor, as an

effective means of informing a wide group of residents/stakeholders of progress with the scheme, the impending Planning Application and their opportunities to input to the process. A detailed communication Strategy has been developed for the scheme to keep the general public informed, but primarily to aid good communication with residents land owners etc directly affected by the scheme.

ii) The Planning Application will be determined by the Planning Committee as Local

Planning Authority. If approved, the proposal will be referred to Government Office North West for consideration of the need for a Public Inquiry.

iii) The Department for Transport Major Scheme approval process has three stages:

Programme Entry (achieved September 2008), Conditional Approval – completion of statutory planning processes, Full Approval – Construction Contract Tender completed/site works ready to commence.

With Early Contractor Involvement, and recommended by the Department for Transport, the Conditional and Full Approval can be sought at the same time. This

increases the level of work funded by the Council, at risk should the scheme not be approved. On going dialogue with the Department for transport will reduce the level of the risk.

4.2 Recommendation Members note the revised programme for the scheme.

5.0 Scheme costs

5.1 Cabinet on the 17th May 2007, approved a council contribution to the scheme of £5.912m over

the financial years 2008/09 to 2012/13.

5.2 The report to Cabinet on the 2nd October 2008 further to Department for Transport granting

Programme Entry revised the spend profile for this funding. The report to Cabinet Member Technical Services in March 2009 on the LTP Capital Programme provided an updated spend profile pending the appointment of the contractor and a more detailed assessment of scheme costs and spend profile. An updated profile is provided below.

October 2008

March 2009 August 2009

Total Approved £’m

Spend to Date £’m

Spend Profile £’m

Spend Profile -£’m

Spend to Date £’m

Spend Profile £’m

2007/08 - - - - - -

2008/09 0.830 0.080 0.830 110 0.114 0.114

2009/10 0.958 0.958 1.478 0.051 1.122

2010/11 0.512 0.512 0.712 0.712

2011/12 1.597 1.597 1.597 1.949

2012/13 2.015 2.015 2.015 2.015

Total £5.912m 0.080 5.912 5.912 0.165 5.912

5.3 For 2009/10, further to the appointment of the ECI Contractor, expenditure will considerably

increase as detailed work towards submitting the Planning Application has commenced.

5.4 5.5

For the Commissioning Report the Contractor has reviewed scheme costs in detail for Phase 1 with an overview for Phase 2. The spend profile given above takes account of DfT requirements for contingency elements to be incorporated, the required commitment from the Council as scheme promoter and defined eligible/non eligible cost for DfT funding.

The spend profile has been modified as the project has developed. Expenditure originally identified in 2008/09 has been carried forward as a result of DfT approval for Programme Entry not being received until September 2008 and re programme of works in conjunction with ECI contract.

5.6 Further refinement of the scheme costs and cost profile is ongoing and this will continue to be reported to Cabinet.

5.7 Recommendation Members note the revised spend profile for the scheme.

Annex B

Thornton Switch Island Link Scheme ECI Phase 1 - Project Management Proposals –September 2009

Management Levels

Role Responsibilities

Corporate Management

Strategic Direction/

Set Business Context

Link to Cabinet and Council for Formal Approvals

Cabinet Member Technical Services/ Cabinet

Director of Planning and Economic Regeneration

Project Board

Directing the project

Directing and controlling project management: Board Member

Core Team Support

Senior Responsible

Owner: • Responsible for project direction

• Monitor and control progress

• Organise/ chair Project Board

• Monitor financial expenditure

• Review outcomes

• Report to Corporate management

Assistant Director PERDs

(Transportation and Development)

Client Agent – Capita Symonds

Assistant Director /Projects Director

Sefton Finance Department

Sefton Project Co-

ordinator – Team

Leader STPU

Senior User: • Promote and ensure project will meet

desired outcomes and be clearly defined

• Represent user issues/ fit for purpose.

• Link to user management

Local Planning Manager

(Strategy and Information Services)

Principal Planner

Local Planning

Senior Supplier • Agree objectives for supplier activities

• Ensure resources available

• Contribute supplier opinions

• Brief non technical management on

supplier aspects

Balfour Beatty Project Director

Jacobs Design Director

Balfour Beatty

Operations Manager

Jacobs Project

Manager

Project Management • Managing the delivery of the project

• Plan and monitor the project through the

monthly progress meetings

• Prepare and monitor Project Plans

• Give direction for Work Packages

• Co-ordinate preparation of formal

submissions

• Manage allocated funding

• Prepare and report to Project Board

Balfour Beatty Project Manager Client Agent

Capita Symonds

Project Leader

Note: Key Core Team Members identified will attend Project Board meetings as requested.

Thornton Switch Island Link

Project Board Management Structure / Reporting Arrangements – September 2009

Chief Executive

Sefton Cabinet Margaret Carney

Cabinet Member

Technical Services

Cllr John Fairclough

Deputy Chief Executive &

Strategic Director Regeneration

Alan Moore

Director of Planning

& Economic Regeneration

Andy Wallis

TSIL PROJECT BOARD

Project Manager Senior User Senior Responsible Owner

(Chair)

Senior Suppliers

Balfour Beatty Local Planning Assistant Director Balfour Beatty Jacobs

Project Manager Manager (Transportation & Development) Project Director Design Director

Mike Ryding Steve Matthews Stuart Waldron Paul Brown Peter Kirk

Client Agent – Capita Symonds

Assistant Director- Nigel Wilkinson

Projects Director – Paul Grogan

Sefton Finance Department

Strategic Finance Manager – Mike Martin

Core Team Support

Client Agent Principal Planner Sefton Project Co-ordinator Balfour Beatty Jacobs

Capita Project Leader Local Plans Team Leader – STPU Operations Manager Project Manager

Colin Jolliffe Ingrid Berry Stephen Birch Drag Barnett Norman Leyland