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Agenda item

Site Cluster Programme Amendments

Report of the Strategic Director of Adult Care, Housing and Public Health

 

Recommendations:-

 

1.    That approval be given to the proposed revised funding profile for the Site Clusters Programme as set out in Appendix 2, which includes an overall increase to the project budget and a net additional impact on HRA reserves of £4.99m, and recommend to Council that the Capital Programme is revised accordingly.

 

2.    That officers be authorised to renegotiate the contract with Wates to a fixed maximum price contract, subject to the cost being containable within a revised funding envelope as set out in Appendix 1.

Minutes:

Further to Minute No. 24 of the meeting of the Cabinet and Commissioners held on 16th July, 2017, consideration was given to the report which detailed how the Site Clusters innovative development model was increasing and accelerating the amount of new housing and providing a range of additional benefits to Rotherham, including specialist accommodation and extensive employment and training opportunities. 

 

The programme was progressing very well and all 7 sites were now under construction and delivering to the agreed construction programme. 

 

At the point of reporting to Cabinet in 2017, the total scheme cost could only be estimated.  The sites were extremely challenging and extensive ground remediation work had been necessary to make them developable.  Other unforeseeable costs have arisen from utilities diversions and an industry-wide increase in the cost of materials and labour. 

 

The Council must now decide whether to reduce the programme to ensure the original budget was not exceeded, or to increase the budget to enable all 217 homes to be built, and to receive the full range of benefits afforded by this innovative partnership. 

 

It was suggested the contract be renegotiated to a fixed, guaranteed maximum price, which would ensure no further risk of cost increase for the Council. 

 

This report had been considered by the Overview and Scrutiny Management Board as part of the pre-scrutiny process who were in support of the recommendations, subject to the Section 151 Officer being requested to share the learning from this project in respect of the tender and contract agreement process and to ensure that larger scale projects undertaken across the authority were well managed and controlled.

 

Resolved:-  (1)   That the proposed revised funding profile for the Site Clusters Programme as set out in Appendix 2, which includes an overall increase to the project budget and a net additional impact on HRA reserves of £4.99m, be approved and Council be asked to approve the revision to the Capital Programme accordingly.

 

(2)  That officers be authorised to renegotiate the contract with Wates to a fixed maximum price contract, subject to the cost being containable within a revised funding envelope as set out in Appendix 1.

Supporting documents: