Agenda item

(Contracts Delivery Portfolio – Cllr R Balcombe) To recommend the additional £1,031,046 allocation within the capital programme for construction of Operations Hub at North Weald Airfield.

That the Cabinet recommended to Council the approval of the additional £1,031,046 allocation within the Capital programme for the construction of the Operations Hub at North Weald Airfield.

The Contracts Delivery Portfolio Holder (Councillor R Balcombe) introduced the report. Stage one of the contract was almost complete with the successful delivery of the interim facility and the completion of the permanent design and associated pricing. However, the temporary facility incurred additional costs above those estimated and included additional temporary fencing, drainage repairs and higher costs for the temporary workshop. The anticipated costs for the permanent facility were higher than originally estimated particularly the drainage arrangements, which were £608,000 over the tendered allowances. Other items included additional design fees, additional preliminary works and ground risk allowance.

In reply to Councillor G Wiskin on whether this was cheaper than using an external operator or had the project been 20% underfunded, the Contracts Service Director (J Warwick) explained the works were more than the original estimate because of the complex drainage requirements on site. The Council did not have a waste depot; therefore, a facility was required. If EFDC had gone out to procurement for a waste contractor as opposed to setting up Terra Verde Services (TVS) Ltd, a waste depot would still be required. EFDC could pay to provide this or ask a waste contractor to provide one, but this cost would then be factored in the contract price, which would mean EFDC would still pay for a waste depot. The Leader clarified the Council had undertaken a tender process for the building works, not TVS.

Councillor S Murray supported bringing waste collection in-house. If EFDC had gone the other route with Biffa would the Council still have built a hub? The Service Director confirmed this was the best option for the Council’s taxpayers. Councillor S Murray was concerned that £608,000 was a lot extra than the tendered amount. The Service Director replied that drainage requirements incorporated into the permanent facility would encompass washdown facilities and fuel was on the complex.

Replying to Councillor Jon Whitehouse the Service Director explained that contractors did not have access to do groundwork surveys, so the drainage issues were only identified afterwards. The Strategic Director & Chief Operating Officer (J Gould) remarked that a briefing note could be included in the minutes. Please see briefing note below:

“The contributing factors for the final contract sum being higher than the initial cost estimate are:

•   The initial estimate was undertaken without the benefit of any formal drainage design and as such was based on a crude £/sqm calculation.

•   The initial estimate was undertaken without the benefit of any ground investigation information (ground is clay - limited opportunity for soakaways).

•   The initial estimate was undertaken without the benefit of any existing drainage system condition information.

•   The design that was produced has required the use of large (below ground) attenuation tanks which have been necessitated by the ground conditions/ existing drainage system and the proximity to the Airfield (no bodies of open water are permitted in close proximity to the Airfield).

•   The use of a crated attenuation system has increased the amount of excavation and amount of material to be taken off site or placed elsewhere on site.”

Councillor M Owen asked if the Council would pay for third party drainage, to which the Portfolio Holder replied, yes, the Council must provide a hub for waste operations, but Biffa was the only other operator with a hub.

Replying to Councillor S Murray, the Strategic Director & 151 Officer (A Small) advised that the revenue income from £1 million would have been between £45,000 to £60,000, which the Council could have used on revenue expenditure.

The report set out the options considered, if any, and the reasons for the recommendation and the decision.

Decision:

That the Cabinet recommended to Council the approval of the additional £1,031,046 allocation within the Capital programme for the construction of the Operations Hub at North Weald Airfield.