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Croydon Council

For General Release REPORT TO: CORPORATE SERVICES COMMITTEE 27 MARCH 2013

AGENDA ITEM: 9

SUBJECT: THE QUEST ACADEMY, MONKS HILL SPORTS CENTRE AND EDGECOMBE COMMUNITY CENTRE REDEVELOPMENT CONTRACT AWARD

LEAD OFFICER: Tony Antoniou, Director of Regeneration & Economy

CABINET Cllr Dudley Mead, Deputy Leader (Statutory) (Capital MEMBER: Budget and Asset Management) & Cabinet Member for Housing Cllr Tim Pollard, Cabinet Member for Children, Families and Learners

WARDS: Selsdon

CORPORATE PRIORITY/POLICY CONTEXT: The Capital Delivery Hub – Education Team on behalf of Children, Families and Learner has a remit to deliver the Quest Academy incorporating the redevelopment of Monks Hill Sports Centre and Edgecombe Community Centre, based on funding provided by Education Funding Agency (EFA) and The Council. Which will: Achieve better outcomes for children and young people Promote economic growth and prosperity

FINANCIAL IMPACT SUMMARY: This report recommends the process for awarding the Contract for the construction of the new Quest Academy School, from the EFA Fixed Funding envelope for the sum of £13.284m plus £1.663m of the Council capital monies committed from the Capital Programme to fund the rebuilding of Monks Hill Sports Centre and Edgecoombe Community Centre.

FORWARD PLAN KEY DECISION REFERENCE NO.: n/a

1. RECOMMENDATIONS

1.1. The Corporate Services Committee are asked to note the previous appointment of a Preferred Contractor (Selected Panel Member) for the re- development of The Quest Academy, Monks Hill Sports Centre and Edgecombe Community Centre and commitment of £1.662m from The Council’s Capital Programme (with an additional £13.284m secured from EFA) for the Contract Sum and:

1.1.1 Agree that, once the Contract Sum Analysis is completed and to meet the necessary timetable for commencement and completion of the construction as detailed in para.3.15, the Executive Director of Planning and Environment, in consultation with the Executive Director of Corporate Resources and Customer Services and the Council Solicitor, be authorised to make the recommendation for Contract Award to the Deputy Leader (Statutory) (Capital Budget and Asset Management) and Cabinet Member for Housing, without prior report to this Committee.

1.1.2 Note that details of the Final Contract Award will be reported to this Committee at a future date (estimate June 2013 CSC)

2. EXECUTIVE SUMMARY

2.1 This report seeks agreement to the process for the Contract Award of The Quest Academy, Monks Hill Sports Centre and Edgecombe Community Centre re-development.

2.2 The Detail Section of this report set out the background to the scheme, approach to procurement and project progress which underpins the recommendations of this report.

3. DETAIL

3.1. The Quest Academy (the Academy) and Monks Hill Sports Centre (the Sports Centre) are located on adjacent sites in Selsdon. The Academy (formally Selsdon High School) was formed in May 2010. At the same time a Memorandum of Understanding (MOU) was agreed between the Council and the Coloma Trust which sets out the basis of the relationship between the parties with regard to sponsorship and development of the Academy.

3.2. The scheme which the Contract Award will cover provides a new build 6 Form of Entry Academy with a 215 place 6th Form and a new build replacement of the Monks Hill Sports Centre and Edgecoombe Community Centre. The Sports Centre is currently owned by the council and run by the Council’s procured Leisure Centre Operator and Manager, Fusion, and the Quest Academy has a licence agreement to use the facilities. The MoU provides that the parties are to discuss and agree arrangements for the longer term use, management and responsibility for the leisure centre currently on the site and any re-build.

3.3. The Edgecombe Community Centre (the Community Centre) is currently located in Monks Hill and is proposed to be re-located to be co-located with the new Quest Academy and Monks Hill Sports Centre site.

3.4. Partnership for Schools (PfS) – now known as the Education Funding Agency (EFA), have allocated a Fixed Funding Package to rebuild the Quest Academy. This is a set budget allocation formula based on the school size (pupil numbers) and totals £13,284,197 (Construction Budget) plus a further ring-fenced Client held budget of £1,070,400 for ICT and the Project Support Funding of £150,000; this provides a total Project Budget of £14.505m. The Council has also set aside £1.7m from the Capital Programme for the re- building of the Sports Centre and the Community Centre, which have been included within the Scheme.

3.5. As the monies for the Academy have been committed via PfS, the Council were required to use the PfS Contractors Framework. The Contracts and Commissioning Board approved the use of the Partnerships for Schools Consultants Framework on the 21st of December 2011 (minute reference: CCB0477/11).

3.6. The PfS/EFA Contractor Framework utilises a Local Competition model comprising the following stages:  Feasibility Study Establishes the Education and Project Brief, local requirements and defines a Control Option that demonstrates the scheme is deliverable and affordable within the Funding Envelope available, has addressed any issues. Sign-off at this stage confirms the project is ready to move to procurement. EFA approval is required before progression to PITT stage  Preliminary ITT (PITT) Initial shortlisting from the PfS Contractor’s Framework to select 2 contractors from the ‘panel’ of 12 to take forward to ITT stage. This stage allows for the design to be developed while still in a competitive tendering process and informs the details that will form the ITT submission  Invitation to Tender (ITT) & Evaluation Following a number of structured engagement sessions with the Project Team (Coloma Trust, Technical Advisors and LBC); the short-listed contractors develop & submit detailed designs and cost plans for evaluation to determine the Selected Panel Member. At the end of this stage, the two Contractors are required to submit their proposals of how the Education and Project Brief will be met and delivered along with full cost information; which must be within the approved funding envelope.  Selected Panel Member and the Final Business Case Completion of the ITT results in the appointment of the Selected Panel Member who works with the Project Team to progress detailed design to produce more detailed Contractor’s Proposals which are fully scrutinised. A Final Business Case is produced by the Technical Advisors and issued to the EFA for review and approval. At this stage all risks (i.e. Planning and management arrangements) must be addressed and the costs confirmed before any approval will be given. In this instance, the Final Business Case will also include the Sports Centre and the Community Centre. Approval allows Contract Award to be complete  Contract Award Awarding the construction contract

3.7. The Contracts and Commissioning Board previously confirmed the procurement strategy of incorporating the re-development of the Sports Centre and the Community Centre into the scope of works required from the Academy Re-development Project. This provides the Council with an established, compliant and robust procurement structure which requires clear cost details to be provided to demonstrate the scheme is deliverable within the funding envelope, demonstrates Value for Money and will offer financial benefits from the ‘economies of scale’ of running the projects in parallel.

3.8. The Council is the Procuring Agent, as required under the PfS Contractors Framework and retains the Client Project Management function/duties, with technical support provided by the Technical Advisor Role, in line with the EFA Scope of Services.

3.9. Mace were appointed as Technical Advisor for the project to offer advice and technical assistance to the Council; funded as part of the Project Support Funding. Duties include developing the PITT and ITT competition documents, implementing the effective use of the PfS Framework as detailed above, technically evaluating the contractor submissions and managing the construction project when on site.

Procurement Strategy

3.10. As detailed in para 3.6, the PfS Contractor’s Framework dictates a concise process to be undertaken to ensure deliverable, cost effective solutions are presented and delivered. As the table below shows, the Academy, the Sports Centre and the Community Centre Redevelopment Project is well advanced in this process:

Stage Timescale Status Feasibility Study 02 April – 19 October Complete 2012 Preliminary ITT (PITT): 03 September – 02 Complete (Appointed Leadbitter November 2012 and Wates Construction as the two short-listed panel members) ITT (& Evaluation) : 08 November 2012 - 18 Complete Select Panel Member January 2013 (Appointed Wates Construction) Final Business Case (& 18 January – 25 May Underway Contractor’s Proposals) 2013

Contract Award 17 May 2013 Underway Start on Site 20 May 2013 Completion of School 01 September 2014 Building Practical Completion of 19 December 2014 full scheme (landscape) 3.11. Wates Construction Ltd were appointed as the Selected Panel Member following the completion of the ITT Stage and the project has now progressed into the Final Business Case Stage which will result a Final Business Case being produced and issued to the EFA for approval. Contractors’ Proposals will be produced as part of this process and a full assessment of the scheme and proposed costs will be undertaken to ensure the contract sum remains within the funding envelope.

3.12. The Procurement Strategy has determined the Sports Centre and the Community Centre are included in the EFA defined Academy Contract Award process as detailed above. The Council funded elements will therefore be subject to the same intense scrutiny as the Academy proposal. The process ensures the costs are in line with the competitive Contractor’s Framework Rates while the scheme still meets the Education Brief.

3.13. Due to the nature of the EFA Academies Procurement Strategy and the requirement of the Department for Education to have the school building open for the new school year in September 2014, the timeframe between the Contract Sum being finalised and the start on site date does not allow for the Contract Award Report to be presented to this Committee at the end of this stage. Therefore, the above recommendations seeks approval for the Executive Director of Planning and Environment, in consultation with the Executive Director of Corporate Resources and Customer Services and the Council Solicitor, be authorised to make the recommendation for Contract Award direct to the Deputy Leader (Statutory) (Capital Budget and Asset Management) and Cabinet Member for Housing. Details of the Contract Award would be presented to this Committee for noting subsequent to that.

3.14. Given the requirements of the EFA Academies Procurement Strategy, the Selected Panel Member must ensure the scheme does not exceed the funding envelope approved, which includes the Council monies allocated for the new Sports Centre and Community Centre. The role of the Technical Advisors and the EFA includes the close scrutiny of this through-out the Final Business Case Stage.

3.15. Consultation

3.15.1. The Council’s Children’s Families and Learners and Sports and Leisure Team have been consulted on the procurement approach and proposed Contract Award. They are in agreement the scheme proposed meets their requirements as detailed in the Feasibility Study.

3.15.2. The EFA have been closely involved and consulted through-out the Procurement Process and will be the Authority to sign-off the Final Business Case; a detailed process to ensure the Contractor’s Proposals are robust, risks effectively addressed and costs in line with the Contractor’s Framework Rates. 3.15.3. The stakeholders of Edgecoombe Community Centre have been consulted on the scope of the project and confirmed their endorsement.

4. REASONS FOR RECOMMENDATIONS/PROPOSED DECISION

4.1. As detailed in paras 3.10 – 3.14, the Procurement Strategy undertaken has been in line with the PfS Academy Framework which has an established Procurement Process and timescale which the Council are required to follow for this scheme. Due to the timescales between the issue of the Contractor’s Proposals and the start on site date (set to meet the EFA timescales and ensure the new school building can open for September 2014) there is insufficient time for the Contract Award to be presented back to this Committee and still meet these deadlines. It is therefore recommended the Executive Director of Planning and Environment, in consultation with the Executive Director of Corporate Resources and Customer Services and the Council Solicitor, be authorised to make the recommendation for Contract Award to the Deputy Leader (Statutory) (Capital Budget and Asset Management) and Cabinet Member for Housing, without prior report to this Committee

4.2. The recommendation is with the additional risk mitigation that in line with the EFA Process, the monies available for the Contract Award are fixed and cannot be exceeded so the Selected Panel Member must ensure their Contractor’s Proposals are in line with the Funding Envelope as well as the Education Brief. If it is not, the EFA will not sign-off the Final Business Case and the Contract Award cannot take place. ;he Contract Award for the Academy, Sports Centre and Community Centre needs to be made between recommendation proposed is to address the

5. 5. ANY OPTIONS CONSIDERED AND REJECTED

5.1. As detailed in para 3.6, due to the nature of the PfS Academies Framework Procurement Process, alternative tenders have been submitted through PITT and ITT. These were fully assessed in line with the EFA Assessment Criteria and Wates Construction Ltd was appointed as the Selected Panel Member. The Final Business Stage requires Contractor’s Proposals to be submitted by the Selected Panel Member and are to fully demonstrate how the original Education Brief will be met and at what cost; clearly presenting the proposals are fully compliant. These details will inform the Final Business Case which the EFA must approve. Only at this point does the successful Contractor get appointed.

6. FINANCIAL AND RISK ASSESSEMENT CONSIDERATIONS Revenue and Capital Consequences of Report Recommendations

Current year Medium Term Financial Strategy – 3 year forecast 2012/13 2013/14 2014/15 2015/16 £’000 £’000 £’000 £’000 Revenue Budget available Expenditure Income Effect of decision from report Expenditure Income Remaining budget Capital Budget 1350 8309 6391 available Expenditure Effect of decision 10,031 4,916 from report Expenditure 115 Remaining budget 1235 (1722) 1475

6.1.1. Effect of the Decision:

The Delegated Authority to award the Contract will enable the construction of a new Sports Centre and new Community Centre as part of the development to provide a new Academy (secondary school age). The Council’s capital programme has committed a total of £1.7m to achieve the improved community facilities, which with this decision will see £1.662m committed against the Contract award and funds expended in 2013/14 and 2014/15, following Contract Award via Delegated Authority.

The decision will also provide Delegated Approval for the Council in its role as Procuring Agent, to go into Contract for the new Academy on behalf of the EFA and Coloma Trust. All monies related to this element of the commitment will be met by the EFA allocated funding envelope (Contract Award of £13.284m) and will have no financial implication for the Council. Contact will be made with the EFA to change the funding envelope to meet the proposed delivery for 2013/14 in order to ensure that there is no financial implication to the Council.

6.1.2. Risk: The principal risk is that the Contract Sum will exceed the approved funding envelope. This is mitigated by the EFA Academy Procurement Process where the Contractor has already committed to competitive rates as part of the tender process to be on the Framework, which their proposals for individual schemes must be in line with and this has been further tested through the PITT and ITT stages. The Contractor is required to take responsibility for projects risks that can incur additional costs. Furthermore, as part of the detailed design development undertaken as part of the Final Business Case Stage, scheme costs are closely monitored, with the Contractor required (under the Framework Arrangements) to identify Value Engineering Options and manage a transparent Change Control Process. The Technical Advisors with support from the EFA monitor this process to avoid risk of the final Contractor’s Proposal being in excess of the approved funding envelope or not meeting the requirements of the Feasibility Study.

A delay to the Contract Award will run the risk of delaying the completion of the new Academy building in time for the September 2014 new term start; this may result in losing the EFA funding and risk impacting on pupil numbers and retention. This risk is proposed to be mitigated by seeking approval for Delegated Authority to Award the Contract within the programme deadlines and maintain the tight programme that will achieve the critical milestones.

A delay to the Contract Award will also result in delaying the replacement of the Sports Centre; the existing building is beyond its life and will become a financial drain on the Council to maintain. The mitigation are the steps to replace and the Procurement Strategy seeks to enable this at the earliest possible opportunity.

The EFA require the management arrangements of the Sports Centre and Community Centre to be resolved before signing off the Final Business Case; should this not be resolved the Authority have the risk of the Final Business Case sign-off being delayed. This risk is being mitigated by early Officer discussions with the Stakeholders and confirmation the management arrangements of both facilities will remain as per current; namely the responsibility of the Authority.

6.1.3. Options:

The option of do nothing has been discounted at an early stage due to the commitment of the Academy Funding Envelope being made by EFA. To do nothing with regards to the Sports Centre and Community Centre would mean buildings at the end of their life become financial burdens to the Council and cease to be assets for the community.

The Option to procure the new Sports Centre and Community Centre outside the EFA Academies Procurement Process was explored but identified would result in greater costs incurred by the Council as a result of doubling up on costs i.e. design fees, survey fees, pre-lims and Contractor over-head costs. Furthermore, due to the close proximity of the existing Sports Centre building to the existing Quest Academy School building the Council would either have to have two contractor’s on site, which brings potential conflicts and associated costs or the works the Sports Centre would be delayed for a further 18 months (while the Academy was being constructed).

The option to delay the Contract Award to enable coordination with the Council’s Committee Cycle has been considered but will cause a two month delay on the programme and result in the school building not being ready for the new school year in September 2014. Such a delay is not acceptable to the EFA and risks funding being withdrawn as well as the school’s pupil intake being further negatively affected. For these reasons this option has been discounted

6.1.4. Future Savings / Efficiencies:

The principal efficiency in the Procurement Strategy proposed is the joined up nature of the three elements that make up the scheme. As a result of adding the Sports Centre and Community centre to the Academy scheme and associated procurement process the scheme has benefited from economies of scale and avoided doubling up on costs.

Furthermore, as part of the EFA Procurement Process the Contractor is required to identify value engineering options that do not reduce quality but identify priorities and the most effective way of doing things to ensure the end result is fit for purpose; in the short and long term.

(Approved by: Helen Sach, Head of Corporate Finance, CRCS)

7. COMMENTS OF THE COUNCIL SOLICITOR AND MONITORING OFFICER

5.1. The Council Solicitor comments that the overall procurement process as detailed in this report meets the requirements of the Council’s Tenders and Contracts Regulations and its statutory duty to secure best value under the Local Government Act 1999.

(Approved by: Gabriel MacGregor, Head of Corporate Law on behalf of the Council Solicitor and Monitoring Officer)

8. HUMAN RESOURCES IMPACT

8.1. There are no direct HR implications arising from this report

(Approved by: Atia Williams on behalf of the Director of Workforce, Equalities and Community Resources) 9. EQUALITIES IMPACT ASSESSMENT (EIA)

9.1. An Equalities Impact Assessment was undertaken in March 2010. Generally the impact of the proposals was deemed to have a ‘positive’ or ‘no’ impact as the project will see significant improvements in community facilities facilitating improvements in the standards of teaching and learning, enabling improved outcome of students and teachers. Due to the co-located strategy of the project, it will also support improved health and well-being of local people and greater community cohesion.

10.ENVIRONMENTAL AND DESIGN IMPACT

10.1. The scheme proposed is required to achieve BREEAM Excellent and will achieve the Council required high levels of Carbon Reduction.

10.2. The scope of the works seeks to maximise the opportunities of the existing site arrangements, namely re-use of existing entry points to avoid changes to traffic and people movements and using the topography of the site to facilitate a new building design that meets the user’s needs. This will ensure there is limited needs for excessive landscape modification which can impact on the wider environment.

10.3. The contractor will provide a Construction Management Plan as part of the Planning Approval; this will clearly set out how the construction works will be undertaken to ensure negative impact on the local area and environment are fully considered and steps taken to mitigate. They will also be required to provide details on Site Waste Management Plans that will facilitate reductions in waste.

(Approved by Bob Fiddik, Head of Sustainable Development)

11.CRIME AND DISORDER REDUCTION IMPACT

11.1. As part of the Planning Application process, Secure by Design Advisors have been consulted and the scheme sought to respond to feedback as necessary to ensure the new buildings and landscape support secure design and safe- guarding of users. 11.2. The scheme seeks to provide improved community facilities to develop greater community engagement and cohesion. The aim is through greater engagement in school and leisure there will be a positive impact on crime and disorder in the area.

12.CUSTOMER IMPACT

12.1. The project will provide a new purpose built Academy for secondary school aged-pupils, a sports centre and community centre. Through effective design and timely progression will result in positive customer impact.

12.2. The new Academy will provide a high quality learning environment with facilities fit for supporting 21st century Teaching and Learning; resulting in teachers having resources to maximise the opportunities for their teaching and improving pupils development and attainment; setting them in good stead for their future achievements.

12.3. The co-location of the new Sports Centre will both support the effective delivery of the School’s Curriculum, supporting health and well-being in schools and in providing the local community with a purpose built quality sporting environment. Both will ensure positive customer impact.

12.4. The inclusion of the new Community Centre will also see greater opportunity for community engagement, development and cohesion; another positive impact for the customer.

12.5. In partnership with the Coloma Trust the new Academy, Sports Centre and Community Centre will be promoted through-out the construction works in readiness for their opening. The Academy will be raising awareness of the new Academy building through-out the school admission process which commences from Spring 2013. Steps will also be taken to raise awareness of the temporary arrangements for the Sports Centre, as well as those for the new sports and community centres to maximise interest and therefore use when they open.

12.6. The Council’s Head of Press and Public Relations has been consulted on these steps and will continue to facilitate the arrangements to ensure messages are effectively shared.

13.HUMAN RIGHTS IMPACT

13.1. Article 2 of the First Protocol of the European Convention provides a right to an effective education, though in the UK this is limited by reservation to the extent that is necessary and within public spending limits.

14.FREEDOM OF INFORMATION (FoI) / DATA PROTECTION CONSIDERATIONS

14.1. There are no specific Data Protection considerations arising from this report. The Council’s Procurement Strategy and Tenders and Contracts Regulations are accessible under the Freedom of Information Act 2000 as part of the Council’s Publication Scheme. Information requested under the Act about the specific procurement exercise which is subject of this report, held internally or supplied by external organisations, will be accessible subject to legal advice as to its commercial confidentiality, or other applicable exemption, and whether or not it is in the public interest to do so.

CONTACT OFFICER: Name: Paula Goy Post title: Senior Project Manager Telephone number: 62204

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