Item 9(A) 11Th October 2017

Item 9(a) 11th October 2017

Glasgow City Region City Deal

Cabinet

Report by Director of Regional Economic Growth

Contact: Kevin Rush Tel: 0141 287-4613

PMO Evaluation: Inverclyde Council – Outline Business Case Inverkip

Purpose of Report:

To report on the PMO evaluation of Inverclyde Council’s Outline Business Case for Inverkip. The Business Case has been considered by the Chief Executives’ Group who agreed that it should be submitted to Cabinet for approval.

Recommendations:

It is proposed that the Cabinet:

1. agree that Inverclyde Council be invited to develop a Full Business Case;

2. note the Executive Summary at Appendix 1 and the Project Risk Register in Appendix 2; and

3. note that no funding is requested at this stage.

1 Purpose

1.1 To inform the Cabinet of the results of the PMO evaluation of Inverclyde Council’s Outline Business Case September 2017 for the Inverkip project. The Business Case has been considered by the Chief Executives’ Group who agreed that it should be submitted to Cabinet for approval.

2 Review

2.1 The submission of this business case for appraisal is considered as confirmation that Inverclyde Council approves the inclusion of this business case as part of the City Deal programme as stated in the current Glasgow and Clyde Valley City Deal Assurance Framework (10 March 2015) in section 4.1.1.

2.2 The project has been reviewed against the business case criteria outlined within Assurance Framework dated March 2015.

2.3 The Cabinet approved Inverclyde’s Strategic Business Case in October 2015 with a funding allocation of £260,000.

2.4 The Executive Summary for the project is attached as Appendix 1. The business case seeks funding for upgrading transport network A78 in four locations which will be an enabler to the development of a key site in Inverclyde, the former Inverkip Power Station.

2.5 Inverkip is an Outline Business Case and as such Inverclyde is now invited to prepare a Full Business Case.

2.6 The development of the full business case, monitoring and evaluation of the Inverkip project will continue to inform the overarching Programme Business Case.

3 Financial

3.1 The total cost of the project is £3.25m. At the SBC stage £0.260m was previously awarded and £4k has been spent to date. A full financial analysis has been carried out as part of the evaluation of the business case for the project funding.

3.2 This is an Outline Business Case for the Inverkip Project and is not seeking any further funding at this stage.

3.3 The drawdown of funding will be completed on the basis of actual and eligible expenditure, in association with the grant drawdown principles outlined within the Assurance Framework.

4 Benefits Realisation

4.1 The Inverkip OBC provides details of the anticipated project outputs and outcomes that will be delivered by the project, including land remediated, housing units, private sector investment, and commercial floorspace.

5 Recommendations

5.1 It is recommended that Cabinet

1. agree that Inverclyde Council be invited to develop a full business case;

2. note the Executive Summary of the Business Case at Appendix 1 and the Project Risk Register in Appendix 2; and

3. note that no funding is requested at this stage.

APPENDIX 1: Executive Summary

Introduction

This document sets out the Executive Summary from the Outline Business Case for Inverclyde Council’s project under the Glasgow City Region City Deal. The project involves:

 Upgrading of key transport network capacity on the A78 at four locations in and around Inverkip (See Fig1)  The provision of development of a Major Area of Change site identified within the Local Development Plan whilst also securing access and safety improvements  Investment in vacant and derelict land assets and land incapable of utilisation for economic purpose without infrastructure investment and support.

The site of the former Inverkip Power Station is identified within the current Local Development Plan as a Major Area of Change, Whilst the owners of the site, Scottish Power Generation Limited have removed a significant element of the built infrastructure on the site, floor slabs and below ground infrastructure still exist on the site along with berthing infrastructure in the Clyde. Transport Scotland have indicated that for the project to proceed on the site, four elements of road infrastructure require to be upgraded and this renders in the Major Area of Change site unviable. City Deal funding will act as an enabler to site development including 650 houses and 6000m2 of commercial space, through the provision of the 4 roads elements.

The outline business case confirms to Cabinet that project funding of £3.25m is required to support infrastructure investment in excess of £100million, re-develop the brownfield site and providing business space, leisure and housing. No additional release of funding is sought beyond that approved at SBC with the submission of this business case.

Off-site roads Infrastructure constraints impact adversely on the capacity to advance the development of a Major Area of Change site restricting economic investment capable of supporting sustainable settlement growth of the two local centres at Wemyss Bay and Inverkip.

TABLE 1 Investment Strategic Outline Business Costs Business Case Case Stage (OBC) Stage (SBC)

City Deal £3.250 £3.250 million Funding / IC million

Scottish £0.00 £100m+ leverage Power/Iberdrola development investment ScottishPower/Iberdrola

TOTAL £3.250 £3.250 million million

The project demonstrates a strong fit with national, regional and local economic policies and is a major element within Inverclyde’s Economic Strategy as a Major Area of Change. The site is specifically identified within the Inverclyde Economic Development and Regeneration Single Operating Plan 2014-2017 Spatial Focus (Section 4.4) and as a key strategic site (Section 4.4.1) highlighting the re-development opportunity to create potential for additional housing and limited commercial accommodation. In the absence of network improvements to the A78 development will not proceed.

The project will make a significant contribution to economic growth, remove the most significant vacant and derelict land site from the V&DL Register, secure third-party investment and support growth across the City Region.

The project delivers important outcomes within the Inverclyde Economic Development & Regeneration Single Operating Plan and Local Development Plan and is supported by all key stakeholders. Development of the site is currently constrained by significant cost abnormalities that impact adversely on the viability of development. The existing A78 roads infrastructure and specifically the existing junctions and merge/diverge slip roads constrain the ability of the development to proceed. Off-site Infrastructure constraints impact adversely on the capacity to advance the development of a Major Area of Change restricting economic investment capable of supporting sustainable settlement growth of the two local centres at Wemyss Bay and Inverkip.

Inverclyde is confronting the challenges of deprivation and economic exclusion that result from long-term changes to Inverclyde’s industrial base and industrial re-structuring. The loss of major industries and support services/supply chains has resulted in constrained capacity and limited economic opportunity with resultant low levels of employment, a small business base and lower than average earnings.

There are high levels of public sector dependency for employment as well as significant out- commuting to the wider Glasgow city region. These are positive and welcome but a sustainable economy needs local jobs and economic drivers that can support the demand for local goods and services and sustain the local business base. The underlying structure of the Inverclyde economy remains weak and over reliant on the public sector to generate employment. Based on available forecasts there is a real danger that the long-term growth rate of the Inverclyde economy will remain below that of Scotland unless significant restructuring of the economy takes place.

The Economic Strategy identifies a clear need to diversify the business base and to stimulate greater economic activity in Inverclyde to sustainably increase levels of employment, income and Gross Value Added (GVA) and to build economic resilience.

A Memorandum of Agreement between the Council and developer will ensure a coordinated approach to investment and:

 secure the redevelopment of a large, strategic brownfield site and Major Area of Change (Local Development Plan)  address constrained housing availability, extend housing choice and promote mixed use wider community facilities  deliver small enterprise / commercial facilities that support area regeneration.

Strategic Need for the Project

Inverclyde Council and its economic development partners within the Single Operating Plan are focussed on delivering investment and development in the area that addresses: Economic disadvantage and inclusive growth within communities (National Regeneration Strategy 2011 / Inverclyde Single Operating Agreement 2014) Sustainable Economic Investment with strong focus on SME’s (Inverclyde Economic Regeneration Strategy (2014-2017) Regenerating Key Economic Sites and Communities (Inverclyde Economic Regeneration Strategy (2014-2017)

Inverkip is identified as a Major Area of Change (LDP). Inverclyde Council has been seeking to facilitate investment at Inverkip through active economic engagement and positive land-use planning. These include:  Mixed Use Development Zoning in the Local Plan 2006  Promotion of Major Area of Change in Local Development Plan 2014.  Supporting and facilitating a Development Masterplan for brownfield land  Developing clear partnership delivery arrangements with Riverside Inverclyde (Ri)  Facilitating private/public sector dialogue on infrastructure and investment with: Transport Scotland / Major Landowners / Service and Utility Providers / Communities FIG 2

The Inverclyde Economic Development and Regeneration Single Operating Plan (2014-2017) identifies the areas strategic challenges and opportunities with specific reference to:

Improving Economic Infrastructure (Section 3.5) focussing on:  Developing key sites within the A8 Corridor and associated with the Clyde waterfront  Increasing Inverclyde’s capacity to diversify the business base  Regenerating Disadvantaged Areas (Section 3.6) focussing on:  An area based, partnership approach to regeneration  Addressing Population Decline (section 3.7)  De-population is a major economic issue with a need to stabilise population

Inverclyde Council has secured, through positive engagement, a masterplan to promote a high quality mixed-use development and secure positive investment in a major brownfield site capable of securing significant regeneration benefits.

Inverclyde performs below average when considering the critical macro-economic indicators for the Glasgow City Region and Scotland.

 Jobs in Inverclyde are generally low in volume and value. The occupational profile is lower value and lower skilled compared to the Scottish average, with fewer 'higher level' jobs.  Wages are broadly comparable to the national average but job density is only at 0.66 per head (compared with the City Region average of 0.77 and the Scottish average of 0.79) (Nomis 2015) and a high dependence on the public sector.  There are less people in employment, less self-employed and more people unemployed – there is a real need for more jobs, especially those that are accessible to the current population  Inverclyde has a smaller business base (43.2 head of population per business in 2015) than the Glasgow City Region City Deal area (34.8) and Scotland (31.1)  Inverclyde has a small and relatively narrow business base, with a reliance on a small number of larger employers, a lack of medium sized firms, and an over reliance on the public sector to provide jobs.

Overall population demographic data and skills data indicates:

 The population in Inverclyde is both declining substantially and aging significantly – there is a need for more jobs (and other supporting factors) to retain a balanced population structure with enough young and working age adults  Skill levels of Inverclyde residents are well below the sub-regional and national comparators but a relatively skilled workforce is still available in the area. This needs a longer-term approach, with success demonstrated by the ongoing improvement in skills levels over recent years for younger adults. There is now a need to create employment that will help to retain and grow this more skilled population base.

The Economic strategy seeks to address the issues of a small and relatively narrow business base, with a reliance on a small number of larger employers, and an over reliance on public sector jobs and focus on three key sectors with the potential for growth. Cruise tourism is a sector witnessing strong and sustainable growth. Investment in a new dedicated quay berth and landside facilities would support major growth in activity and support national, regional and local policies to boost tourism numbers, spend and market penetration whilst supporting local regeneration efforts.

The project will deliver important area network infrastructure improvements that support private sector investment and release the constraint on a designated area of major change. Investment by the private sector at circa £100+million will drive new employment including construction activity and create new commercial/business space.

City Deal funding will address transport infrastructure capacity and bring forward investment in a large vacant and derelict site.

Current Position

Inverclyde Council and Transport Scotland have identified a range of issues with the road Network in North Inverkip, Brueacre and Inverkip slip roads and junction standards for some time with a range of interim measures adopted with limited success.

A partnership approach to investment offered opportunity to address a constraint on development whilst progressing a public infrastructure improvement delivering benefits that accord with the Route Action Plan (Transport Scotland); Regional Transport Strategy; Community Council concerns and critical will unlock a regionally significant scale of economic development.

Options Inverclyde Council with Transport Scotland and Scottish Power/Iberdrola have investigated a range of options to develop the facilities and create the enabling infrastructure for economic investment.

The option appraisal sets out the evolution of the project and the testing / validation process to assess a range of transportation alternatives and options. It outlines that a range of potential options have been identified and considered in developing the preferred option based on a Detailed Transportation Assessment (Atkins) and discussions with Transport Scotland / Transportation Services within Inverclyde Council.

Do Nothing Retain existing arrangements with no further capacity or junction improvements and look to future Local Development Plan or alternative finance measures Transport Scotland / TIF / Infrastructure Fund to fund

Traffic Signalised Junction with Speed Controls Promote a new traffic Signalised Junction together with associated A78 Speed Controls and/or other speed reducing measures on the Trunk Road

New Roundabout Junction and Junction Improvement Preferred Option Promote a new roundabout Junction to Brueacre and Main Street with all associated traffic management measures together with pedestrian and cycle facilities to support enhancement for all transport modes and improve accessibility

Re-align A78 & Create new Roundabout Promote wider upgrading including dual entry roundabouts to secure additional long term capacity and access.

FIGURE 3 MAIN STREET JUNCTION FIGURE 4 BRUEACRE SLIP

Project Elements and Funding

Investment Costs Strategic Business Case Outline Business Case Stage (SBC) Stage (OBC)

City Deal Funding / £3.250 million £3.250 million IC

Scottish £0.00 £100million leverage Power/Iberdrola investment

TOTAL £3.250 million £3.250 million

Cost allowances Strategic Business Case Outline Business Case Stage (SBC) Stage (OBC)

Capital Investment £2.500 million £2.500 million

Optimism Bias £0.25 (10%) £0.375 (15%) Contingent Sums £0.10 (4%) £0.250 (10%) Fees & Consenting £0.400 £0.400

TOTAL £3.250million £3.250 million

Project Scope

The scope of the project involves the development of a new commercial (6000m2) and residential district (650 houses) secured through investment in upgrading four existing infrastructure components, identified below, that constrains development of the site and surrounding area.

The A78 at Wemyss Bay and Inverkip (Brueacre) presents a long-standing issue in terms of capacity of the road infrastructure to meet all road user needs; transport user safety, development access and capacity for the infrastructure to service economic development in the west Inverclyde area and without the investment from City Deal, this Major Area of Change site will not be developed.

Inverkip will be implemented and delivered by Scottish Power under a standard NEC Contract suitable for transport infrastructure work contracts.

Scottish Power and its consultants have the expertise to project manage transportation projects of this scale and complexity and will appoint a Design Team through competitive tender. The broad breakdown of capital costs (inc. OB) are as follows:

 Inverkip North £900,000 Inscribed 36m diam 3 leg junction  Brueacre Junction Northbound Slip £400,000 Slips to DMRB specification  Brueacre Junction Southbound Slip £400,000 Slips to DMRB specification  Brueacre Junction £800,000 5 leg junction

Development Elements (Inverkip Site Re-development)

 Development of 650-675 mixed tenure housing as an extension to Wemyss Bay in accord with the Local Development Plan. Site areas and densities are as follows: o Main Street: 4.9ha; 40 units/ha Total 196 units o Harbourside: 1.4ha; 35 units/ha Total 49 units o Streets and lanes: 10.7ha; 25 units/ha Total 268 units o The Hill: 5.7ha; 28 units/ha Total 160 units  Development of Mixed Use Leisure / Retail and Enterprise facilities supporting tourism, local SME business activity  Remediation of c20+ha of brownfield land within the wide site 43ha site  Provisional provision of up to 6,000m2 commercial space o Class 4 business/ space GFA up to 500m²; o Local food/ non-food retail unit GFA up to 1000 m²; o Restaurant/ pub/ hotel GFA up to 500m2: o Community facility GFA up to 3000m2 o Boat yard- berths for yachts GFA up to 600m2  Provision of 10,000m2 of public realm / leisure facility / harbourside  Provision of 1.3km linear metres of coastal connected/linked footpath/cycleway  Retention of and enhancement of 25ha of Green Network

Project Governance and Project Management Arrangements

Inverclyde Council as lead sponsor and client for the works has developed a formal governance agreement (Memoranda of Agreement) with ScottishPower /Iberdrola to advance the project and site re-development.

A multi-disciplinary Project Board has been established within Inverclyde Council to establish a partnership based management team to deliver the project. The Inverkip Board meets on a six weekly basis to oversee project delivery.

External consultancy support has been appointed by Scottish Power under Inverclyde’s procurement protocols and currently includes the following, all of whom bring a host of experience in a number of similar projects:

 Peter Brett Civil Engineering  Turley Masterplanning / Planning  Marine/Coastal Arch Henderson  Property GVA

Project Contribution to the City Deal Economic Case

Delivering sustainable growth within a diversified economy that can generate additional gross valued added benefits (GVA), jobs and enterprise opportunity are the project’s core objectives.

The project directly contributes to the economic outcomes set out in the City Deal Infrastructure Fund: Economic Case by delivering a significant uplift in GVA, net additional employment and net additional tax revenues beyond that required to satisfy the City Deal GVA requirement.

City Deal Economic Benefits It is anticipated that when the main development scenario is completed, it will provide:

• £6m Inverclyde/£10m Scotland additional net GVA per annum; • £110m investment • 6,000 m2 occupied commercial floorspace; • 200 Inverclyde/ 250 Scotland net additional full time equivalent (FTE) positions; • 950 Inverclyde/ 2,600 net PYE (person year equivalent) construction employment • £34m Inverclyde/ £116m Scotland net GVA construction. • £3m Inverclyde/ £5m Scotland net wages per annum • £22m Inverclyde/ £71m Scotland net construction wages • £400k annual non-domestic rates • £900k annual council tax

In determining the benefits, it is assumed that the major infrastructure works will start on site early in 2020, once the offsite infrastructure works are complete, with work completed in 2032 when the site will be fully developed. FIGURE 5

APPENDIX 2: PROJECT RISK REGISTER

CITY DEAL PROJECT RISK REGISTER

Project Title: Inverkip Development Member Authority: Inverclyde Council Project Location: Inverkip Project Sponsor: Riverside Inverclyde Programme Manager: Aubrey Fawcett

Date Updated: Aug-17 Last Reporting Period: OBC Oct SP-IBD additional input / Design Team sought

Objectives &

Projects OBJ Partner objectives are incompatible impacting on Heads of Terms require conclusion partner agreement Project programme IC / SP- with investment programme set OBJ01 Open impacted 4 2 8 8 IBD against grant support (City Deal). 0.5 4 4 Oct-17 Partner boards fail to conclude partner agreement Heads of Terms require conclusion Project doesn’t IC / SP- with investment programme set OBJ02 Open proceed 5 2 10 10 IBD against grant support (City Deal). 0.5 5 5 Oct-17

CON Contractual Developer Scheme fails - Oct-17 Partnership Partnership and agreement not Development Early dialogue to develop robust secured Objectives cannot IC / SP- basis for partnership and Business CON01 Open be met 5 2 10 IBD Case 1 10 10 City Deal funding Oct-17 is not secured Scheme fails. IC /ScottishPower/Iberdola need to Partner Objectives IC / SP- jointly develop Business Case and CON02 Open cannot be met 5 1 5 5 IBD rationale for intervention 0.5 2.5 2.5

ENV Environmental 0 0 0 EIA Scoping Potential need to Oct-17 identifies modify project significant scope and design. environmental Programme delays impact not caused by Initial Environmental Scoping capable of mitigation IC / SP- identifies no major or significant ENV01 Open mitigation requirements 3 2 6 6 IBD issues 0.25 1.5 1.5 Statutory Need to adjust Oct-17 Consultees scheme concerns with key components to be Planning Report supportive. All elements of compliant & statutory consultees contacted. No development address stakeholder IC / SP- significant issues or in principle ENV02 Open concerns 3 3 9 9 IBD objections raised 0.5 4.5 4.5 Contaminated Oct-17 land or other land issues identified within the Viability of development site proposed Desk Studies and historical site creating abnormal development IC / SP- remediation actions are reviewed ENV03 Open development costs impacted by cost 3 3 9 9 IBD aagainst updates SI. 0.5 4.5 4.5 Protected species Requirement for Oct-17 and/or habitat protected species identified on-site licenses or othe or in Clyde mitigation with cost Early commitment to walkover / programme IC / SP- Phase 1 Habitat and Protected ENV04 Open impliations 3 3 9 9 IBD Species Survey 0.25 2.25 2.25 Developer Oct-17 assessment and site contamination risk assessment Cost and required relative programme and to PCB's / viability issues on Asbestos / Other residential housing Review contamination assessment legacy securing NHBC and specialist risk assessment and ENV05 Open contamination standard. 4 4 16 16 SP=IBD Peer Review. 0.25 2,25 Protected species Requirement for Oct-17 and/or habitat protected species identified on-site licenses or othe or in Clyde mitigation with cost Early commitment to walkover / programme IC / SP- Phase 1 Habitat and Protected ENV04 Open impliations 3 3 9 9 IBD Species Survey 0.25 2.25 2.25

FIN Financial 0 0 0 0

Inherent Inherent Resid Risk Description Inherent Inherent Resid Resid. Date Movement Risk Ref Status Risk Category Probabilit Risk Owner Controls Action Risk Impact Rank Impact Rank Checked in Period y Score Score Challenge Impact Concept is Oct-17 unsupported by strategic funders / Strong support evidenced at Transport Scotland partner meetings. Strategic and consenting IC / SP- engagement with Transport FIN01 Open authorities Scheme fails 5 3 15 15 IBD Scotland. 0.25 3.75 3.75 Economic case Oct-17 (OBC/FBC) & Undermines / needs assessment weakens project Economic impact and needs not satisfied justification and IC / SP- assessments advanced though SBC FIN02 Open SBC 4 3 12 12 IBD /OBC /DBC completed. 0.25 3 3 Increase in capital Impact on Oct-17 costs as technical economic assessment justification. advances. Further assessment Inadequate as OBC/DBC. Optimism Bias Change in scope, Detailed Economic and specification, IC / SP- Cost/Benefit and VfM Case to be FIN03 Open programme 4 3 12 12 IBD advanced. Full reporting at OBC 0.75 9 9 State Aid conflicts Oct-17 restrict funding and partnership Private /public approach sector partnership IC / SP- FIN04 Open not viable 5 3 15 15 IBD No State Aid issues 0.25 3 3 Oct-17

Health & H&S Safety 0 0 0 0 Transportation Requires design Oct-17 improvements not changes with supported by Road implications on Safety Audit cost, programme IC / SP- H&S01 Open and consenting 4 2 8 8 IBD Early engagement with TS 0.25 2.25 0 Former Power Oct-17 Station site has residual Requires additional contamination/ remediation with ground water or imliation son cost, other issue programme and IC / SP- H&S02 Open restricting housing consenting 3 2 6 6 IBD Desktop study 0.25 2.25 0 Major accident at Oct-17 junction or associated with site impacts on perceptions and Public support and design statutory IC / SP- Appropriate transport H&S03 Open specifications obligations change 3 1 3 3 IBD management plan 0.25 2.25 0 Road Safety issues Oct-17 emerge in traffic Secure early dialogue with management / Transport Scotland on the detailed final scheme that Design requirement IC / SP- elements of scheme, programme H&S04 Open are unacceptable to satisfy DMRB 3 2 6 6 IBD and contract delivery. 0 0

Inherent Inherent Resid Risk Description Inherent Inherent Resid Resid. Date Movement Risk Ref Status Risk Category Probabilit Risk Owner Controls Action Risk Impact Rank Impact Rank Checked in Period y Score Score Challenge Impact Marine structures Oct-17 and marine piles require specialist sub-sea working with H&S / cost Specialist and programme assessment IC / SP- Secure agreement on furure use H&S05 Open risks required 2 4 8 8 IBD and retention as boardwalk 0 0

Information IT Technology 0 0 0 0 Digital and utility networks not provided for requires work / within design servicing post works IC / SP- IT01 Open proposals completion 1 1 1 1 IBD Full survey prior to works 0.25 2.25 0 Oct-16

People / P/S Social 0 0 0 0 Wider Oct-17 stakeholders and community interests not fully Major objections to Consultation supportive to date engaged in the planning application IC / SP- requires clear engagement strategy P/S01 Open process and road orders 3 2 6 6 IBD to be developed with local interests 0.5 3 3 Public rights of Oct-17 way and access identified/asserted managing future within site. access and coastal IC / SP- early engagement on Masterplan P/S02 Open walk 1 2 2 2 IBD with local communities 0.5 1 1

Physical / P/A Assets 0 0 0 0 Insufficient land Oct-17 available within Adopted Highway Impacts on Complete detailed title Search and to allow scheme programme and IC / SP- confirm sufficient for all works P/A01 Open scheme content. 4 2 8 8 IBD including mitigation 0.5 4 4 Transport Scotland Oct-17 require construction phasing to minimise disruption to A78 Programme IC / SP- DMRB compliant scheme and/or P/A02 Open route management 3 2 6 6 IBD early agreement on any deviations 0.5 3 3

Inherent Inherent Resid Risk Description Inherent Inherent Resid Resid. Date Movement Risk Ref Status Risk Category Probabilit Risk Owner Controls Action Risk Impact Rank Impact Rank Checked in Period y Score Score Challenge Impact Development site Oct-17 sub-bases / culverts / b/g structures more onerous and Detailed further ScottishPower/Iberdrola reporting impact on extent investigation IC / SP- on site investigation requires Peer P/A02 Open of development required 4 3 12 12 IBD review 1 12 12

POL Political 0 0 0 0 Planning Consent Development for Housing requires planning Development approval and requires satisfactory Consent requirements and confirmation purification of IC / programmes require incorporation POL01 Open conditions 3 3 9 9 SPG into OBC / FBC 1 9 9 Oct-17 Political interests Oct-17 determine project represents poor lack of political Development Agreement requires value for public support (SGov / IC / IC / public benefit from public POL02 Open investment TS / Community) 3 3 9 9 SPG investment 0.5 4.5 4.5 LDP process fails Oct-17 to support Mixed Use in this location and/or masterplan Consent requirements and place issues not Scheme fails to programmes require incorporation POL03 supported secure approvals 3 3 9 SP-IBD into OBC / FBC 1 9

PRO Professional 0 0 0 0 Procurement fails Scheme fails to Oct-17 to secure secure approvals competent and adverse professional team impacts on IC / SP- PRO01 Open programme / cost. 3 2 6 6 IBD Promotion of scheme 0 0 Professional team Oct-17 lack the skills and project Scheme fails to management secure approvals expertise to and adverse address client impacts on IC / SP- nature of work allows high level of PRO02 Open requirements programme / cost. 4 1 4 4 IBD confidence in professional team 0.25 1 1 Competition IC / SP- IBD No competition identified but PRO03 Open requires review 4 1 4 State Aid compliance 0.25 1 Oct -17

Inherent Inherent Resid Risk Description Inherent Inherent Resid Resid. Date Movement Risk Ref Status Risk Category Probabilit Risk Owner Controls Action Risk Impact Rank Impact Rank Checked in Period y Score Score Challenge Impact Legal challenge IC / SP- IBD Awareness of legal Oct - PRO04 Open challenge 4 1 4 State Aid compliance 0.25 1 17

REG Regulatory 0 0 0 0 Transport Scotland Road Order and Oct-17 approval and Road agreement TS Orders not critical. Project PD elements require confirmation granted can't proceed as IC / SP- and dialogue advanced with REG01 Open presently conceived 2 2 4 4 IBD statutory/regulatory bodies 0.75 3 3 Reduced Planning Consent Development Oct-17 for Housing requires planning Development approval and requires satisfactory Consent requirements and confirmation purification of IC / SP- programmes require incorporation REG02 Open conditions 3 3 9 9 IBD into OBC / DBC 1 9 9 Planning authority Oct-17 impose conditions and / or S75 limiting Impact son viability IC / SP- early dialogue with the planning REG03 Open development of project 3 1 3 3 IBD authority 0.5 1.5 1.5 Wider Inverkip Oct-17 and Wemyss Bay Operational Proposals demonstrate betterment traffic circulation / traffic over existing and safer, more management management IC / SP- accessible network with benefits REG04 Open required review 2 2 4 4 IBD across all modes 0 Statutory Need to adjust Oct-17 Consultees scheme concerns with key components to be Planning Report supportive. All elements of compliant & statutory consultees contacted. No development address stakeholder IC / SP- significant issues or in principle REG05 Open concerns 2 3 6 6 IBD objections raised 0 State Aid advisory Oct-17 panel require open market compliance with No State valuations State Aid impacts Aid impacting on on Partnership IC / SP- REG06 Closed viability Agreement 1 3 3 3 IBD State Aid issues should be clarified 0.5 1.5 1.5 issues

REP Reputation IC enter into Oct-17 development agreement and project doesn't loss of reputation to IC / SP- secure early understanding REP01 Open proceed IC and City Deal 2 1 2 2 IBD between IC and SPG 0.75 1.5 1.5

Inherent Inherent Resid Risk Description Inherent Inherent Resid Resid. Date Movement Risk Ref Status Risk Category Probabilit Risk Owner Controls Action Risk Impact Rank Impact Rank Checked in Period y Score Score Challenge Impact IC enter into Oct-17 Development Agreement and SP-IBD radically Reputation loss to IC / SP- secure early understanding REP02 Open amend project IC and City Deal 3 2 6 6 IBD between IC and SPG 0.75 4.5 4.5 Partnership interest no longer supported. Private partners withdraw. Determine not to proceed under Reputation loss to IC / SP- secure early understanding City Deal IC and City Deal 1 4 4 4 IBD between IC and SPG 0.75 4.5 Oct-17

Schedule / S/T Timescales 0 0 0 0 Project Oct-17 programme Programme reflects current amended by understanding on statutory statutory consents Delay and costs IC / SP- consultations. Project Execution S/T01 Open /requirements risks 2 3 6 6 IBD requires detailing in OBC 0 0 Project timescales Cost increases, Oct-17 unrealistic and reduction in require extending partner/stakeholder Detailed GANTT Programming support/ impact on IC / SP- including dependencies needs S/T02 Open outcomes 3 2 6 6 IBD addressing 0 0 Project Partners Oct-17 fail to provide information to City Deal allow SBC to programme IC / SP- S/T03 Open proceed. unachievable. 3 2 6 6 IBD Programme to be confirmed 0 0