Sunday, October 11, 2009

Pedestrian Heart

The Echo, has been running hard with the report dealing with solicitors Ward Hadaway's advice on the EC Harris 2007 report regarding the Pedestrian Heart scheme.

As you might imagine, Tuesday's Cabinet meeting was dominated by an intial debate about the matter. I think it's fair to say that there was no meeting of minds, although I was faintly surprised that the Echo gave so much headroom to Mike Barker's silly "resignation" call to Council Leader John Williams. Labour members, in contrast to the Tories and LibDems, wanted the relevant all-party Scrutiny Committee to look at this issue and report back.

The Tories and LibDems, however, were happier with snap judgements and name-calling.

Risibly, the Tories are maintaining that they alone had the business acumen to bring forward improvements made by the Resources Scrutiny Committee last time. That claim was thwacked into touch at Cabinet by my colleague Ian Haszeldine. And as Bill Dixon had to remind everyone, the now-notorious NEC contract, which apportioned a 90/10 split between the Council and the contractors on cost overruns, was approved by a committee which included Labour and Conservative members. For sure, lots of hard questions were asked by councillors, but in the end they received the reassurances from the officers advising them.

The Council has been at pains to stress previously that mistakes were made, and every effort taken to improve standards of working. As paragraph 17 of the covering report from the officers notes, "The Council has previously and on numerous occasions acknowledged that this project has not been well managed. Significant changes have been made as a result of this project to the Council's process for handling capital projects."

I have been following this issue closely in the Echo, and I can't see where they have reprinted the Council's response to the 10 questions they posed in an edition last week. This may simply be an oversight on my part, but anyway, in the spirit of openess, here they are again;

Q1. Why does the council have so little correspondence and paperwork on a major town centre redevelopment scheme costing more than £6m? Is it normal practice not to keep files recording the authority's involvement in critical decisions (paragraph 1.5 of the report)?

The report details records were not fully maintained as part of the project management processes - we have been open about this and addressed it through new robust procedures.

All major capital projects (over £75k) are now managed by experienced staff - and records are maintained and reported to elected members and senior managers on a regular basis.


Q2. Why did the authority not finalise and execute a signed contract with the project's lead consultant, Gillespies (section 5)?

The sequence of events around the contractual arrangements are detailed in the report - ultimately, although contracts were not formalised this does not mean Gillepsies were not responsible for their element of work.

Q3.Turning to the New Engineering Contract (NEC). Who was responsible for drawing up the terms of a contract described in the report as "extremely low risk" (for the contractor) "with very limited incentive for efficient working"?

Again, the project management is cited as a weakness, and with the evidence and records available, we acknowledge this was not the most appropriate contract.

Q4. Why was the painshare/gainshare split of the NEC arranged so that the authority shared 90% of any savings or 90% of any additional costs? As the report says, the two percentage figures are frequently different, being favourable to the employer by placing overrun costs predominantly at the contractors risk (para 4.5). Why did this not happen?

Again, the project management is cited as a weakness, and with the evidence and records available, we acknowledge this was not the most appropriate contract.

Q5. If, as the report says, the authority hoped to bring the contract in under budget by omitting non essential areas of work if necessary, the decision to begin work on peripheral areas in October 2005 made this highly unlikely to happen. Who took the decision not to adhere to the planned critical path for the works through the main pedestrian area? Why was this decision taken? If the authority was concerned about disruption in the run up to Christmas why did the work start at all? Why did the authority ignore the advice of Birse and the consulting team that work not start in October 2005? (para 3.4)

Whilst Gillespies maintain it was our decision, we are not in a position to dispute it. However, throughout the project there was always the very genuine motivation of wanting to minimise disruption to traders - and this may have been a driver.


Q6. Why did the authority opt to replace the gas pipe in its entirety rather than immend the scheme? Does the authority acknowledge that choosing this course of action when the pipe did not require immediate replacement meant the cost could not be shared with a public utility, which would have significantly off-set the cost to taxpayers?

Again, records are not clearly maintained. However, the pipe would have needed replacement in 25 years, and at its exceptionally shallow depth, would not have allowed the steps in the design of the project to be delivered safely. Therefore, the decision to replace the pipe was taken.

Q7. If the authority opted to replace the pipe to avoid further disruption at some point in the future why did it not include such work in the original plan, thereby preventing a cost overrun when it had agreed a 90% painshare split?

Again, this refers to a regrettable sequence of events whereby the initial contract had weaknesses and in hindsight was not appropriate to the project.

Q8. How closely were council members involved in these decisions and how often were they briefed? Who was aware of the problems?

Decisions were brought to Cabinet - these have been documented already publicly and fully - in the press and in Council business and are detailed in the report.


Q9. Why did the council opt to spend more money on a report by Wardhadaway when its legal case was so weak? Did the council's legal department offer a view of the chances of a successful claim? If not, why not?

It was a recommendation by Resources Scrutiny Committee to review the Pedestrian Heart scheme to establish whether there was merit in pursuing the contractors for costs. The total costs were £40,000.

Q10. What new measures are in place to ensure this does not happen again?

Key changes have been made, as described.

12 comments:

ianh said...

ianh said...
Nick...
Ultimately this whole sorry mess must bring about questions of responsibility and accountability.

You have predictably pointed to the failure of the Scrutiny Commiittee to raise concerns at the appropriate time.
As i stated on Mikes blog last week:
"I am however concerned that the scrutiny committee model means that the ruling party can in effect make the opposition complicit in their actions.
IE, without (apparently) having full access to the facts , the all-party scrutiny committee failed to effectively bring dbc to account at the time of the mistakes.
Now, several yrs on the mistakes and incompetence have again been highlighted but dbc fall back on the fact that the scrutiny committee did not act at the time.
This is true, but surely this brings into the question the appropriatness of the Scrutiny system when dealing with details involving legal contracts etc."

Irrespective of the above, the ultimate responsibilty must lie with the elected cllrs who get paid, via their allowances,to take responsibility for their portfolios.
Ulitmate responsibilty must then lie with the council leader, who on a number of occassions has now shown that he is incapble of getting the big decisions right.

As far as i am aware, no-one, cllr or officer, has taken responsibility for their mistakes, or proved that they are accountable for their actions.

Darlington Councillor said...

Thanks, Ian.

This might seem like I'm splitting hairs, but I'm not making any kind of attack on scrutiny - the committee I referred to was responsible for shortlisting and then selecting the contractors.

I mentioned it only because (according to themselves) the Tories have assumed god-like powers of foresight all of a sudden, and apparently would have been able to pick up on the problems in advance. Well, from what we can see from the committee which awarded the '90/10' contract, Tory members are just as fallible as Labour councillors.

There is a whole big debate about accountability and where it lies that is very prevalent in national government too - you tend to find that in opposition, parties (of all colours) call for ministerial heads to roll, but then have a change of tack when actually in office themselves and difficulties with detailed contract management come to light.

ianh said...

Thanks Nick,
So no individual at DBC is accountable nor will accept responsibilty for the "mistakes" of cllrs or un-named officers?

I have to say, had this been a private business, rather than one funded by the unfortunate council tax payer, heads would have rolled years ago!
oh, and the ceo would have been held to account (by the shareholders) for his employees mistakes.

Paul Cain said...

Councillor

Your reply boils down to:

Yes, we screwed it up, but no we're not going to take responsibility.

While we're at it, we're going to use a fiasco like this to make political points.

Making political points is more important to us than wasting vast sums of public money.

As Ianh says, if this had been a privately-owned company, there would have been blood on the carpet.

But this is the town hall, run by you lot and the usual rules of decency and accountability do not apply.

You're a disgrace.

Anonymous said...

Have to agree with Ian H and Paul.

Anonymous said...

Come on guys give Nick Wally a break, what else do you expect from the self appointed chief apologist of a failed Labour Council? Admissions of fault, fallibility or even shock horror being part of the problem?

Let’s remember Nick Wally’s part in the Eastern Transport Corridor fiasco (which followed immediately after the ped heart), how he promised to control costs on this very blog then when it all went wrong and cost the Council tax payer £100,000’s extra it wasn’t his fault, in fact it wasn’t anyone in the Labour groups (despite him claiming over £17,000 for managing the portfolio, not bad for doing nothing).

Cllr Nick Wallis is at best a liar and spin doctor, it’s a shame he doesn’t focus his obvious talent for misinformation into a more important field namely saving the long suffering Council tax payer the wastefulness of his parties actions.

Expect no change either in attitude or rhetoric, Cllr Nick Wallys long past changing his bombastic arrogant ways. The real people at fault are the fools who voted this creature into office in the first place, the bloods on their hands, only grease and slimes on his!

ianh said...

Sorry, but i do tire of these abusive and tpically anonymous emails.
I have frequently disagreed strongly with Nick on a number of subjects affecting our borough but see no need to descend to personal abuse.
At least Nick bothers to put his views across on this blog, giving all of us the opportunity to give ours.
Lets stick to the subject and avoid the abuse.

miketually said...

Well said ianh.

Anonymous said...

The answer to Q7 is just waffle. The gas pipe work could have been included in the original contract under a provisional sum. Just ask any junior quantity surveyor! And as regards to a contractor saving a client some money, it must be a joke! or someone is not living in the real world. Obviously any contractor on a job is out to make money, savings are unheard of.

Anonymous said...

According to it's web site DBC is accredited ISO 9001 which covers the compliance of agreed procedures that are related to the management of projects etc, assuming that these procedures were in use it would be safe to say that some of the "lost paperwork" should be around somewhere either as multiple copies or electronic form!

Anonymous said...

Question 9
Quite amazing that the legal dept. tried to collect information from contractors against which they may persue for costs. Would anyone in their right mind provide information that would incriminate themselves. Not on tyhis planet anyway!

Anonymous said...

So the legal paperwork has gone missing, by some coincidence that would mean that all of the copies of each piece of paper that was produced in the begining has now disappeared. How could that happen?
What does the scrutiny system think of it?