Hospital Redevelopment Partnership Group

HRPG 19 December 2016

HOSPITAL REDEVELOPMENT PARTNERSHIP GROUP MINUTES / ACTION POINTS of a meeting held at Ministry of Health offices, 6 Hazeldean Business Park, Addington, Christchurch on Monday, 19 December 2016 at 1.00pm

Members Evan Davies (Chair), Margaret Wilsher, Tony Lanigan Ex-Officio members Michael Hundleby, David Meates Attendees Tony Lloyd, John Hazeldine, Marbeth Isaac, JiM Coard, Lynn Archibald - Minutes (MoH), Rob Ojala, Angela Mills, Brad Cabell (CDHB)

Bryan Spinks (Proj-X) item 3.0 Leonie Kelly, Adrian McLay (Turner and Townsend Thinc), Jenny Fisher (Holmes Consulting) item 5.0 Alistair Burke (Johnstaff) items 6.0 & 7.0 Neville Robb (RLB) item 6.0 Annabel Frazer (Destravis) and Bruce Wattie (PWC) item 8.0 Adam Flowers (CCM Architects) item 4.0 Neil O’Donnell (RLB)

Item Discussion/Decision/Action

1.0 WELCOME AND APOLOGIES Murray Cleverley 2.0 PREVIOUS MEETING OF THE HRPG

2.1 Review of minutes The Minutes of the HRPG meeting held on 22 November 2016 were accepted as a true and correct record with the following noted:

Item 4.0 ASB. February/March 2017 is the date in which fit out of wards can be included in the pre-determined price. If a decision is not made by this date then the cost of this work will have to be renegotiated. .

Who 3.0 BURWOOD

3.1 Project Manager’s Report Bryan Spinks spoke to the updated Proj-X report for the period to early December 2016.

Code of Compliance is expected prior to Christmas with Practical Completion on track for early next year. Site management over the Christmas period will be the responsibility of the contractor.

Following a request from Leighs Cockram for TL early release of their performance bond the HRPG felt it was acceptable to release this bond now as the Ministry still holds in excess

Private and Confidential - Circulation restricted to Hospital Redevelopment Partnership Group ONLY Page 1 of 8 Item Discussion/Decision/Action of $xxx in retentions. HRPG requested that the Ministry’s legal view be sought to the early release of the performance bond.

David Meates and Rob Ojala joined the meeting.

4.0 PARKSIDE The PWC report dated 14 December 2016 and Destravis Group report # 6 dated December 2016 were taken as read.

Annabel Frazer and Bruce Wattie briefed the Partnership Group on progress to date. PWC have completed/partially completed draft documents for Strategic, Economic, Financial, Commercial and the Management case and are awaiting key inputs as outlined in their status report. Given the complexities around the options, the next steps were to ensure these were described appropriately and the attributes documented, together with risks around financial case. PWC advised until these were completed they would not release the draft TL documents to any external parties as in their experience this led to unnecessary debate and concern.

The Chair requested that Tony Lloyd consult with the DHB to confirm population demographics and on a plan of consultation with clinicians and to formulate a programme plan to be circulated to the HRPG.

Rob Ojala, on behalf of the CDHB, expressed concern as to progress towards completion of the planning process.

It was noted that a recently completed fire report may impact the business case financially. Brad outlined the contents of the report and explained that he thought that the cost could be up to $150m to rectify. RLB have only just received this report and will work through the implications in the new year.

Going forward agenda item to be changed to “Christchurch Campus”.

5.0 ASB 5.1 Seismic Movement The report from Holmes Consulting dated 8 December 2016 was provided in response to a request that formal advice be sought from structural engineers on the expected performance of the ASB in various earthquake scenarios. HRPG 19 December 2016

Jenny Fisher from Holmes Consulting, joined the meeting to brief the Partnership Group on the seismic performance of the ASB.

The ASB had been designed, taking into account all knowledge gained from previous earthquakes, to be operational after a major event (1:500 years).

Jenny confirmed that the building would perform well in earthquakes similar to the event in Wellington and had been designed to achieve the Serviceability Limit State (SLS), the additional Serviceability Limit State (SLS2) which will provide an operational hospital post a 1:500 year event; the Ultimate Limit State (ULS) where there may be damage but can be repaired and the Collapse Limit State (CLS) which is where the building could not be economically repaired but will preserve life. Based on the data from Wellington’s earthquakes, Holmes would not change the way the ASB is designed.

5.2 Project Manager’s report The Turner & Townsend Thinc report for December 2016 was taken as read.

On the subject of seismic resilience, it was noted there has been a Building Code change for suspended ceilings with current design documented for 10 kilos and over now reduced to 7.5 kilos. The project team are seeking pricing in order to comply with the new standard.

Leonie spoke to the Turner Townsend report noting the project is 33% through the construction contract with 19 months to go. A claim for 25 days delay for changes in the issue for construction drawings has been received and will undergo assessment.

Adrian McLay briefed the Partnership Group on the alternative bracing system the builder had put forward. This system was the same fly bracing system used at Burwood. This alternative bracing system has enabled the project to maintain programme and realise

Private and Confidential - Circulation restricted to Hospital Redevelopment Partnership Group ONLY Page 3 of 8 Item Discussion/Decision/Action savings.

With regard to key project risks - migration planning and operational readiness - the DHB noted they were awaiting updated programmes from Woods Harris and approval of resource to appoint migration resource.

Depth of experienced resource for the commissioning of a building of this size was flagged as a possible risk. The DHB are aware they need another 8-12 people and this was a point of risk, however the personnel they do have, have a significant level of experience.

5.3 Financial Report The Rider Levett Bucknall Construction report 37 dated 30 November 2016 was taken as read.

Referring to work outside of project scope/budget (page 47 of 203) Rob referred to the Christchurch Campus planning process and the key assumption that there were 64 beds on the 8th floor of the ASB. From his perspective there remains a degree of uncertainty as to status of these beds given these have not been included in the current project budget estimate.

The Chair confirmed at this stage the HRPG did not have the budget to reinstate wards and additional funds would be required from the TL Crown to reinstate them. However, with any request Ministers would want to know if there were other likely requests and with the uncertainty over whether Crown funding would be requested for Princess Margaret Hospital Mental Health services, and with the uncertainty of the Christchurch Campus business case and Programme of Works quantums this could not be answered adequately.

5.4 Health and Safety Referring to a recent conviction under new legislation of Auckland Council for their admitted lack of oversight of their sub contractors’ maintenance protocols and programme the Chair recommended the Partnership Group need to take a view, as a governance group, of what they need oversight of. An example would be ensuring maintenance programmes of on site cranes are documented and undertaken in the way in which they are documented and having an engineer prepare schedules to validate they have undertaken inspections of areas. HRPG 19 December 2016

Item Discussion/Decision/Action The Chair sought an appropriate approach as to the levels of oversight the Partnership Group would be required to have in order to comply with legislation.

The Lucas Health and Safety report for November 2016 was taken as read.

6.0 SITE CO-ORDINATION A second meeting between the three stakeholders has occurred with the fourth not in attendance. Some levels of conflict have arisen due to traffic access which could result in the relocation of the Outpatients portacoms if left unresolved. A meeting with Otakaro/DHB has taken place resulting in a request to resolve the overall co-ordination of the sites. An agreed solution is being worked through to ensure Outpatients project is not delayed and hospital traffic is not affected. 7.0 OUTPATIENTS 7.1 Project Manager’s report The Johnstaff report # 13 dated 13 December 2016 was taken as read.

An extension of time claim for 42 working days has been lodged by Leighs related to steel delay in off shore fabrication and independent certification requirements. The preliminary view is this claim has limited merit.

7.2 Stage 2 Pricing Jim Coard presented options and recommendations for the Partnership Group’s consideration, as outlined in his memo dated 19 December 2016.

Option 1 For categories 2 and 3 trades, incorporate the $XXXXXXX risk allowance into provisional sums to address unresolved technical and operational queries associated with tender recommendations and enable LCL to finalise their stage 2 proposal as soon as possible and let the time critical subcontracts early in the New Year. While this option brings the stage 2 tendering process to a close within the required timeframe, the provisional sums present a pricing risk to the project as they may be insufficient to cover eventual trade costs.

Private and Confidential - Circulation restricted to Hospital Redevelopment Partnership Group ONLY Page 5 of 8 Item Discussion/Decision/Action Option 2 Instruct LCL as a variation to the stage 1 contract (as per the façade package and secondary steel) to proceed with engaging the recommended tenderers for the time critical subcontracts, while the balance of the non-time critical tender recommendations is resolved as soon as possible in the New Year. The time critical trade packages (Fire Protection, Mechanical, Electrical and Lifts, *Plumbing and Hydraulics) are category 1 trades, and have been technically and financially agreed, representing a savings of $XXXXX (not including façade and secondary steel savings) against budget.

*Plumbing and Hydraulics were inadvertently omitted from the critical trades. This was noted verbally by Jim Coard to the Partnership Group prior to endorsement.

Recommendation The Partnership Group agreed to endorse Option 2 and LCL will be instructed to engage the Fire Protection, Mechanical, Electrical, Lift sub-contractors and Plumbing and Hydraulics as variations to stage 1 in order to maintain the project programme.

7.3 Health and Safety The Lucas Health and Safety report for November 2016 was taken as read.

8.0 ENERGY CENTRE

8.1 Project Manager’s report The Johnstaff report dated December 2016 was taken as read.

9.0 CDHB

9.1 Programme of Works The following reports were noted:

Overview Summary dated 19 December 2016 Appendix 1: Project Progress Summary Report Appendix 2: Project Status Reports

It was noted that in item (v) reference was made to the engagement of Dr Erica Seville and Professor Ken Elwood to develop and test a revised prioritisation framework. The DHB confirmed this was to review the decision making framework to ascertain if there was a better way to apportion/assess buildings with the amount of money available. HRPG 19 December 2016

The HRPG requested that recommendation (vi) be removed as the HRPG have no visibility on the financial status of the CDHB.

9.2 Facilities Development The Facilities Development report for the period 7 November – 5 December 2016 was noted.

9.3 Facilities Development Project Monthly Reports for Maia Health Foundation, Canterbury DHB ICT Workstream, Canterbury DHB Infection Control, Workforce Transition Project were noted.

10.0 NEXT MEETING Planning update. Date to be confirmed. The meeting concluded at 2.51pm.

Private and Confidential - Circulation restricted to Hospital Redevelopment Partnership Group ONLY Page 7 of 8 Reports/Documents Distributed prior to the Meeting - Minutes of Previous Meeting 22 November 2016 - Burwood Project Director’s Report early December 2016 - ASB Project Director’s Report for period 16 November to 7 December 2016 - RLB Burwood Financial Cost Reports for ASB No. 37 and Outpatients No. 15 - Lucas Safety report ASB and Outpatients - November 2016 - Ministry of Health/Johnstaff – Outpatient Status report dated 13 December 2016 - Ministry of Health/Johnstaff – Energy Centre report dated 12 December 2016 - Programme of Works Overview Summary dated 19 December 2016 - Appendix 1: Project Progress Summary report dated 28 November 2016 - Appendix 2: Project Status reports - CDHB Facilities Development Project Monthly report for period – 7 November to 5 December 2016 - Maia Health Foundation 2 December 2016 - Canterbury DHB ICT Workstream 28 November 2016 - Canterbury DHB Infection Control December 2016 - Workforce Transition Project 28 November 2016 Late Papers - Agenda (revised) - Destravis Group status report # 6 December 2016 - PWC status update 14 December 2016 - Outpatients Stage 2 pricing 19 December 2016

Note: Additional Reports were circulated for Information. They did not form part of the meeting Agenda. - FF&E forecast report for period 1 November 2016 to 1 December 2016 - Risk Management Register as at 9 December 2016