Issue - meetings

To provide the Cabinet with an update that the demolition works at the former Cummins factory site are complete and seeking additional funding for the project overspend with the contract and additional monies for ongoing project management support from Avison Young. 

Purpose of report

To inform the Cabinet that the demolition works at the former Cummins factory site were complete whilst seeking additional funding for the project overspend with the contract and additional monies for ongoing project management support from Avison Young.  

Decision

That Cabinet:

1.    Approves the additional costs from the demolition contract with GF Tomlinson of £52,249.11 along with £49,000 for ongoing project management support.

2.    Approves a reserve movement of £100,000 from the Local Priorities Reserve to the Regeneration Reserve in order to provide funding for the costs outlined in resolution 1.

3.    Approves the funding of these additional costs from the Council’s Regeneration Reserve, having approved recommendation 2.

Alternative options considered and rejected

The Council was contractually required to settle the final invoice with GF Tomlinson. It could have decided not to progress with external project management support, but the Council did not have in-house expertise to support the progression of such a complex project.

Reason for decisions

The Council was contractually required to pay GF Tomlinson the remainder of the contract sum as the works had been instructed and completed. The initial sum granted for £1.3 million had no contingency monies built into it for unforeseen works, such as asbestos removal.

The Council did not have the internal knowledge or resources to internally project manage this complex infrastructure/construction scheme. The lack of knowledge and continuation of a project manager would be a risk to the Council.

In the report to the Finance, Economic Development and Corporate Services Overview and Scrutiny Committee in September 2022 it was identified to the Committee at that time that the contract was overspent due to unforeseen works that were not included in the original contract

Cabinet on 18 October 2022 approved an additional £192,630.23. The final account (after detailed scrutiny) showed a contract overspend requiring Cabinet to approve the sum of £52,249.11 to pay this final invoice and conclude the contract.

Project Management support had been ongoing from Avison Young with weekly meetings with the Head of Corporate Projects, Policy and Performance yielding advice regarding the complex demolition works required to the site.

Cabinet approved the sum of £49,000 to continue this support due to the complex nature of the site and the lack of internal resource within the Council that had knowledge and skillset in this area.