GreenhamParishCouncil–ControlTowerReviewResponse 1
GreenhamParishCouncilBDOControlTowerReview
ManagementResponse
24May2017
GreenhamParishCouncil–ControlTowerReviewResponse 2
GreenhamParishCouncilResponse&ActionPlanResultingFromBDOAuditReportOverview
InApril2014,GreenhamParishCouncilpurchasedtheformerairfieldcontroltoweronGreenhamCommonwiththeintentiontoconvertintoadedicatedvistors’centreandcelebrationofGreenhamCommon’shistory.Theprojectfacedanumberofcomplicationsresultingindelaystotheplannedopeningofthesite.BDOwerecommissionedtoundertakeaninternalaudittoreviewtheproject’sgovernanceprocessesandprocedures,thefinalauditandrecommendationsbeingdeliveredinJanuary2016.
Theauditidentifiedanumberofdeficienciesinthecontrolsforthemanagementofalargecapitalprojectsuchastherefurbishmentofthecontroltower.13recommendationsweremadetoimproveprojectcontrolsandbringdeliverybackontrack.
GreenhamParishCouncilhaveactedontheserecommendationsandthefollowingresponsesetsoutthemeasuresnowinplaceorintheprocessofbeingimplementedtoaddressprojectmanagementshortfalls.
AreasIdentifiedRequiringManagementResponse
The13recommendationstoimproveprojectcontrolswere:
1) Theneedforaclearlydefinedscheduleofworksthathavebeenaccuratelycosted,providingtransparencyoncostsandcompletiondates.
2) Employmentofacapableprojectmanagerforthedurationoftheproject3) Formaltenderingprocessandduediligenceofcontractors.4) EnhancedreportingfromtheControlTowerCommitteewithscrutinyfromfull
council5) Formalcommunicationplantoupdatethepublicontheprogressofthe
refurbishmentprogramme.6) Increasedfinancialtransparencytopreventperceptionoffavourabletreatment.7) Reviewofworkomittedtoensurehealthandsafetycomplianceandproject
objectivesarebeingmet.8) Reviewthefuturebusinessplanforthebuildingandseekprofessionaladviceon
commercialstructure.9) TheControlTowerCommitteeTermsofReferenceshouldbereviewedandupdated.10) Membersshouldreviewtheirrolesandresponsibilitiesforperforminggovernance
andoversight.Theroleoftheclerkistobereviewed.11) Committeestructuresneedongoingscrutinyandconsideration12) Recordsandminutesofallmeetingtoberecorded.13) Identifyandactonanypotentialconflictofinterest.
GreenhamParishCouncil–ControlTowerReviewResponse 3
RESPONSEANDACTIONUNDERTAKENTheneedtoadoptamorerobustandcautiousapproachtoprojectevaluation,monitoringandcontrolisacknowledged.Thecomplexityandsizeofaprojectthissizeneedsprofessionalprojectmanagementskillsandmethodologytocorrectlyinitiate,executeandcontrolprojectactivity.TheCouncil’sprioritywastoreviewtheprojectinitiationandpreparationphasestoensureaccuratecostingsanddevelopadetailedprojectplan.Toachievethis,thefollowingactionshavebeenimplemented:
• AbuildingsurveyorwasengagedinApril2016toidentifyfutureworksandprovide
someinputforfuturecostings.Thescheduleofworksproducedisattached;
• Aspartofregularscopeandriskmanagement,areviewoftheseworksandcostingwasconductedinJanuary2017toestablishgreaterdetailandprovideenhancedbreakdownofcosts;
• RecruitmentofaprofessionalprojectmanagementfirmbeganinApril2017;oncein
place,aprojectmanagerwillbetaskedwithreviewingremainingworksanddevelopingadetailedscheduleofcostsandworktobecompleted;
• Aspartofroutineriskandsensitivityanalysis,anumberofcontingencyplanshave
beendevelopedtomitigateagainst,forexample,reducedfuturefundinganduncertainrevenuesinthefirstyearofoperation;
BDORECOMMENDATION1
Theneedforaclearlydefinedscheduleofworksthathavebeenaccuratelycosted,providingtransparencyoncostsandcompletiondates.
Thereisanimportantneedtorecognisethatsignificantdecisionsrequiringlargefinancialoutlayshouldfollowaformalprocessofconsiderationandevaluationbeforecommittingtoaproject.GoingforwardstheCouncilshouldensurethatthereisaclearlydefinedscheduleofworksthathavebeenaccuratelycosted,thereforeprovidingcompletetransparencyontheexpectedcompletiondatesandrunningcosts.Thecouncilshouldundertakesensitivityanalysistoidentifytheprobabilityandmagnitudeofanysevereunforeseeneventstotheexpectedcostsoftheprojects.
GreenhamParishCouncil–ControlTowerReviewResponse 4
• Theprojectbudgetcarriesa10%contingencyfundtocaterforunforeseen
circumstances.
ResponsibleOfficer:ChairofControlTowerCommittee
ImplementationDate:ProjectManagerassignedJune2017
GreenhamParishCouncil–ControlTowerReviewResponse 5
RESPONSEANDACTIONUNDERTAKENAsperrecommendation1above,GreenhamParishCouncilarefullycommittedtoemployingasuitablyqualifiedprojectmanagergoingforward.Thiscommitmentisillustratedbythefollowingactions/measures:
• RecruitmentofaprofessionalprojectmanagementfirmbeganinApril2017;oncein
place,aprojectmanagerwillbetaskedwithreviewingremainingworksanddevelopingadetailedscheduleofcostsandworktobecompleted.
• Adetailedjobdescriptionfortheprojectmanagerroleisattached(appendix1).
Withinthisroletheneedtodevelopadetailedcostingfortheremainderoftheprojectishighlighted.Theimportanceofhighlightingkeydatesandprojectelementswhichcouldaffecttheprojectoutcomeisalsodetailed.
• RecruitmentofanewCouncilClerkwithexperiencemanaginglarge,publicsector
projects,inordertoassistwithprojectmanagerrolerequirementsandrecruitment.
ResponsibleOfficer:ChairofControlTowerCommittee
ImplementationDate:April2017
BDORECOMMENDATION2
Employmentofacapableprojectmanagerforthedurationoftheproject
ForthedurationoftheprojecttheCouncilshouldconsidertheemploymentofacapableprojectmanagertopreventanyfurtherdelaysorfinancialslippage.Aformalisedscheduleofworkstocompletetheproject(withaccuratecostings)shouldbepreparedwiththeCounciltakingownershipforon-goingscrutinyintheachievementofkeymilestones
GreenhamParishCouncil–ControlTowerReviewResponse 6
RESPONSEANDACTIONUNDERTAKENThefailuretoundergoarigoroustenderingprocessintheearlystagesoftheproject,inpartduetotimeconstraints,iswellrecognised.Moreover,theneedtoensurevalueformoneywhenspendingpublicmoneyisattheforefrontoftheproject’stenderingprocessevidencedbythefollowing:
• TheroleofprojectmanagerhasbeenputtocompetitivetenderusingtheContracts
Finderwebsite.Therolehasthereforebeenadvertisednationallyandhasbeenoverseenbythecouncilclerktoavoidrisksofcouncillorsfacingconflictsofinterest.
• Aspartoftheformaltenderassessmentcriteriaforpublicsectorcontracts,bidders
havebeenaskedtoprovideevidenceoffinancialviabilitytoensuretheirabilitytoadequatelycompletethework.
• Althoughtheprojectisunlikelytoawardanymorecontractsabove£10,000,wheresuchacontractisrequired,asimilarprocessofformalpublicsectorinvitationtotender,independentlyoverseenbythecouncilclerk,isexpected.
ResponsibleOfficer:ChairofControlTowerCommittee
ImplementationDate:April2017-ongoing
BDORECOMMENDATION3
Formaltenderingprocessandduediligenceofcontractors
Itisrecommendedthatlargercontractsareplacedonthegov.ukcontractfinder.Thisisdesignedspecificallyforthelocalauthoritiesandotherpublicsectorbodiesseekingcontractorsforover10k
Duediligenceshouldalsobeundertakenonallsupplierstoensuretheirfinancialandoperationallegitimacy–therebyreducingthereputationalrisktothecouncilintheeventofsupplierfailure.
GreenhamParishCouncil–ControlTowerReviewResponse 7
RESPONSEANDACTIONUNDERTAKENThereportrecognisedthatareportingprocedurehadbeenputinplace,whichprovidedfullCouncilwithreportsofhighquality.Goingforwardthisreportingprocedurewillcontinue.Inaddition,withtheappointmentofaprofessionalprojectmanager,reportsaretoinclude:
• Progressandexpenditureagainstbudget.Anyvariationfromthecostschedulewill
berequiredtobereportedtofullcouncil.
• Riskandmitigation.Aspartofthenewprojectcontrols,monthlyreportingtoFullCouncilwillincludeareviewoftheprojectriskregister,ensuringappropriateriskmitigationandownership.
ResponsibleOfficer:ChairofControlTowerCommittee&ClerktotheCouncil
ImplementationDate:June2017
BDORECOMMENDATION4
EnhancedreportingfromtheControlTowerCommitteewithscrutinyfromfullcouncil
TheControlTowerCommitteeshouldcontinuetoproducemonthlyprogressreportshighlightingKeyareasforconsideration.TheseshouldbereviewedinfullbytheCouncilandchallengedprovidedwherethereareareasofconcern
The report should specify any deviations from the original project plan andfactorthis intothebudgetcalculationstoprovideamoreaccurateassessmentofoverspend.
GoingforwardstheCouncilshouldworktogethertoachievethe
GreenhamParishCouncil–ControlTowerReviewResponse 8
RESPONSEANDACTIONUNDERTAKENTheneedtoengagewithallstakeholdersisrecognisedasvital.Generatingandmaintainingpublicsupportfortheprojectisvitalfortheproject’ssuccessinthelongerterm,whilstkeepingotherpartnersandgrantfundersinformedastoprojectprogressisanessentialpartofprojectoversight.Anumberofmeasureshavebeentakentoaddressthis:
• AllmeetingoftheControlTowerCommitteenowtakeplaceatatimewhere
membersofthepublicaremorelikelytobeabletoattend.
• Thecontroltowercommitteewillonlyexcludethepublicandmediafrommeetingswherediscussionsareofaconfidentialnaturesuchasemployment,contractmatters,whenanyitemcouldbreachDataProtectionorwhereprofessionaladvicehasbeenreceivedsuggesting“Part2”tobeappropriate.
• ACommunicationPlanfortheprojecthasbeendeveloped(attachedappendix2).
• AspartoftheCommunicationPlan,asurveyofpublicopinionhasbeenimplemented.Thisextensivesurveyisbeingundertakenwithaviewtoengagingandupdatingthepubliconthecurrentstatusoftheproject.Thesurveyhasbeenpublicisedinlocalpressandonthecouncil’swebsite.1
1ThePublicSurveyendson6May2017.Resultsareexpectedsoonafterandwillbepublicisedonthecouncil’swebsite.
BDORECOMMENDATION5
Formalcommunicationplantoupdatethepublicontheprogressoftherefurbishmentprogramme.
ThecouncilshouldconsiderpreparingaformalcommunicationplantoupdatethepublicontheissuesthathaveariseninthedevelopmentandrestorationofTheControlTower.
TheControlTowerCommitteeshouldensurethereisfulltransparencyformeetingsandnotprecludeallkeydecisionsuntilthePart2element.
GoingforwardstheCouncilshouldworktogethertoachievethecommongoalofdeliveringtheprojecttoitsagreedtimescale.Failuretodosowillfurtherincreasetheriskofdelaysandprojectcostsmaycontinuetoescalate.
GreenhamParishCouncil–ControlTowerReviewResponse 9
• SocialmediaforTheControlTowerhasbeenre-activatedandisprovidingafeedofinformation.
ResponsibleOfficer:ChairofControlTowerCommittee&ClerktotheCouncil
ImplementationDate:March2017
GreenhamParishCouncil–ControlTowerReviewResponse 10
RESPONSEANDACTIONUNDERTAKEN
Theawardoffuturecontractsofmorethat£10,000valuewillbesubjecttoanopentenderprocess,usingappropriatetenderportals(e.g.thegovernmentContractsFinderwebsite)toensureopennessandensurethereisnoperceptionoractualityoffavourabletreatment.
ResponsibleOfficer:ClerktotheCouncil
ImplementationDate:April2017
BDORECOMMENDATION6
Increasedfinancialtransparencytopreventperceptionoffavourabletreatment.
Thecouncilshouldensurethatitadherestothefinancialregulationstherebyensuringthatservicesarebeingobtainedfromlegitimateandreputableorganisationsbutalsotoensurevalueformoneyisobtained.
Anyongoinguseofcompaniesforconsultingandplanningworkaswellascompliance(eitherecologicalorregulatory)shouldbeverycarefullyconsideredtodemonstratetherearesufficientsafeguardsandsegregationofdutiestopreventtheperceptionoffavourabletreatment.
GreenhamParishCouncil–ControlTowerReviewResponse 11
RESPONSEANDACTIONUNDERTAKEN
Partoftheprojectmanager’srolewillbeathoroughhealthandsafetycompliancereview.Thecouncilisalsocurrently(May2017)undertakingawholesaleriskassessmentofallitsactivitiesandareviewofriskinthecontroltowerprojectwillformpartofthis.
ResponsibleOfficer:ChairofControlTowerCommittee
ImplementationDate:onappointmentofPMinJune2017
BDORECOMMENDATION7
Reviewofworkomittedtoensurehealthandsafetycomplianceandprojectobjectivesarebeingmet.
Thecouncilshouldformallyriskassesstheworksthathavebeenomittedtoensurethattheydonotposeahealthandsafetyrisknorwilltheirexclusionimpactsignificantlyontheoriginalobjectivesoftheprojectsenttograntfundingbodies.
GreenhamParishCouncil–ControlTowerReviewResponse 12
RESPONSEANDACTIONUNDERTAKEN
Afullcomprehensivebusinessplanhasbeendevelopedandisattached.Keypointsofmethodologytoaddresstheauditreport’sconcernsare:
• ThecashflowmodelsfortheControlTowerworkonthebasisthatthecaféelement,
officespaceandstoragespaceisletonacommercialterms.Topresentarealisticcaseinthecashflowmodels,adviceonrentslikelytobeachievedforthespaceattheControlTowerandonannualrunningcostswasobtainedfromlocalprofessionals.
• Theexpenditurefiguresareallbasedonknownrunningcostsassociatedwiththebuilding(heatingoil,water,telecoms,etc).Estimatesforexpenditureonbuildingmaintenance,electricsupply,andwastecollectionarebasedpartlyonfiguresfromTheGreenhamCommonTrustwhichhasextensiveexperienceinthemanagementofcommercialandpublicbuildingsandpartlyonfiguresestimatedbymembersoftheControlTowerCommitteewithexperienceinthesubject.
• ProfessionaladviceisbeingtakenontheappropriatestructureoftheentitythatwilloperateTheControlTower.Engagementwithsolicitorsregardingformationoftheoperatingentitybeginsweekcommencing1May17.Onceoptionsforformationofthatoperatingentityareestablished,thecouncilwillactivelyworkwithHMRC.
ResponsibleOfficer:ChairofControlTowerCommittee
ImplementationDate:June2017
BDORECOMMENDATION8Reviewthefuturebusinessplanforthebuildingandseekprofessionaladviceon
commercialstructure.
Thecouncilshouldreviewthecommercialplanindetailtoensureitissatisfiedwiththemethodologyusedtheprinciples/assumptionsinitsrationale.Wherethereareconcernstheseshouldbereflectedtoensureanaccuratemodelisproduced.
ThecouncilshouldseekprofessionalguidanceregardingthefuturecommercialstructureoftheenterpriseoverseeingthecommercialactivitiesattheControlTower.
ThecouncilshouldproactivelydiscusstheapproachwithHMRCtoensurecompliancewithVATregulations.
GreenhamParishCouncil–ControlTowerReviewResponse 13
RESPONSEANDACTIONUNDERTAKENThetermsofreferencefortheCTChavebeenreviewedandareupdatedonaregularbasiswhichclearlyspecifiesthecomposition,rolesandresponsibilities(includingkeydeliverables)andreportingagreedbyfullcouncil.AcopyoftherevisedtermsofreferencefortheControlTowerCommitteeisattachedandisavailabletobeviewedontheGreenhamParishCouncilWebsite.
ResponsibleOffice:ChairofGreenhamParishCouncilandClerktotheCouncil
ImplementationDate:March2017(ongoing)
BDORECOMMENDATION9
TheControlTowerCommitteeTermsofReferenceshouldbereviewedandupdated.
Thetermsofreferenceshouldbeupdatedtoclearlyspecifythecomposition,roleandresponsibilities(includingkeydeliverables)oftheControlTowerCommittee.Thisshouldincludethefrequencyanddetailoftheupdatestobeprovidedtoensureappropriateaccountability.
GreenhamParishCouncil–ControlTowerReviewResponse 14
RESPONSEANDACTIONUNDERTAKENTheabsenceofqualifiedindividualsinthefirstpartoftheconstructionprojectisrecognised.TheappointmentofaProjectManagerisdesignedtoovercomemanyoftheproblemsencountered:
• TheCouncilhasidentifiedinthejobdescriptionfortheProjectManageraclear
reportingstructurewheremembersofthecouncilperformanoversightrole.
HighlightedintheroleprofilefortheProjectManageristheneedto:
• Establishacommunicationscheduletoupdatestakeholdersincludingappropriate
representativesoftheControlToweroperatingcompanyontheprogressoftheproject
• Monitorandreviewallexpenditureagainstbudgets
• MonitorcashflowprojectionsandreportpotentialvariationstoGreenhamParish
Councilonaregularbasis(bi-weekly)
Thefuturebuildschedulehasbudgetedforsuitableprofessionaladvicetobesoughtinareasincluding:
• Provisionofdetailedsitedrawingstomeetfuturelistedbuildingandplanningneeds
• Promotionoftheopportunitiestooperatethecaféandoccupyanofficeandthesubsequentdraftingofcontracts.
• LegalfeesfordraftingcontractbetweenGreenhamParishCouncilandtheoperating
entity
• FeesforregisteringtheoperatingentitywiththeCharityCommission.
BDORECOMMENDATION10
Membersshouldreviewtheirrolesandresponsibilitiesforperforminggovernanceandoversight.Theroleoftheclerkistobereviewed.
TheCouncilshouldremindmembersoftheirrespectiverolesandresponsibilitiesforperforminggovernanceandoversightrolesandtheClerkshouldensurethatprofessionalguidanceandsupportisprovidedwhenrequired.
GreenhamParishCouncil–ControlTowerReviewResponse 15
TheroleoftheClerkisthatofasupervisoronbehalfofTheCouncil,notanactiveprojectmanager.AnewClerkhasbeenrecruited,however,whohasextensiveprojectmanagementexperiencetoenablethemtofulfilasupervisoryrole,providingprofessionaladviceandguidancewhenrequired.
ResponsibleOfficer:ChairofControlTowerCommittee&ClerktotheCouncil
ImplementationDate:April2017
GreenhamParishCouncil–ControlTowerReviewResponse 16
RESPONSEANDACTIONUNDERTAKENAnumberofgovernancestructureshavebeenimplementedtounderscoretheneedforoversightbyFullCouncilinlinewithStandingOrders:
• TheChairmanoftheControlTowerCommitteeisrequiredtoreporttoGreenham
ParishCouncilonaregularbasis.Itemsreportedtobechallengedandopenconstructivediscussionencouraged.
• The‘ControlTowerReport’iscirculatedtoCouncilmembersinadvanceofmeetings
toallowadequatetimeforscrutiny.
• SignificantdocumentsproducedbymembersoftheControlTowerCommitteewhichmayhaveimplicationsforGreenhamParishCouncile.g.businessplans,budgetsarecirculatedindraftformandcommentsencouraged.
• TheClerkmanagesthedistributionofdocuments,sharingbydefaultratherthanbyrequestorexception.
ResponsibleOffice:ClerktotheCouncil
ImplementationDate:April2017
BDORECOMMENDATION11
Membersshouldreviewtheirrolesandresponsibilitiesforperforminggovernanceandoversight.Theroleoftheclerkistobereviewed.
WhilsttheCouncilhavetakenappropriateactiontoformalisetheCommitteestructuresinplacethereneedstobeon-goingscrutinyandconsiderationofthegovernancestructuresinplacesurroundingtheprojecttoensureallCouncillorsaresatisfiedwiththerevisedarrangements.
GreenhamParishCouncil–ControlTowerReviewResponse 17
RESPONSEANDACTIONUNDERTAKENMinutesfromtheControlTowerCommitteehavebeenmaintainedsinceitsinceptioninAugust2015.Thenewclerkensuresthiscontinues.MinutesfortheControlTowerCommitteearecirculatedtoallcouncilmembersindraftformpriortoapproval.ApprovedMinutesarepublishedontheCouncil’swebsite.SignedminutesandcopiesofanyconfidentialmeetingnotesproducedbytheControlTowerCommitteeareheldattheClerk’sOffice.
ResponsibleOffice:ChairofGreenhamParishCouncil
ImplementationDate:Ongoing
BDORECOMMENDATION12
Recordsandminutesofallmeetingstoberecorded.
RecordsandminutesshouldbemaintainedofallworkinggroupsandCommitteestosupportthedecisionsbeingmadeandtoensurethatthemeetingwasquorate.
GreenhamParishCouncil–ControlTowerReviewResponse 18
RESPONSEANDACTIONUNDERTAKEN
Therecommendationisacknowledgedandamorerobustapproachisnowbeingtakentoidentifyingconflictsofinterestandensuringanysuchconflictisproperlyrecordedintheminutes.Thisshouldaddressthisissuegoingforward
ResponsibleOfficer:ChairofGreenhamParishCouncil/ClerktotheCouncil
ImplementationDate:April2017
BDORECOMMENDATION13
Identifyandactonanypotentialconflictofinterest.
TheCouncilshouldensurethatallconflictsofinterestareappropriatelyidentifiedandrecordedandmitigatingactionistakenwhereitisfelttoimpactupontheachievementoftheCouncil’sobjectives.