Depot Rationalisation: Bankhead

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Nov 18, 2013 (3 years and 8 months ago)

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Executive
Committee




D
ate:
1
1
September


201
2



Agenda Item No

12



Depot Rationalisation: Bankhead

Report by:
Steve Grimmond, Executive Director, Housing and Communities



Wards Affected:

all

Fife



Purpose

T
o provide an update on progress
with
Bankhead

Central

.



Recommendation

Committee is asked to

note the report


Resource Implications

This is an update report.
The previous report to PFAM Committee (February 2012)
approved a refreshed business case. The approved capital budget for the
program
me is £21.95M for property acquisition, refurbishment, infrastructure
improvements and energy efficiency measures.


This project remains self
-
financing. As reported in February, the upward pressure
on costs can be met within the revised business case and will be financed through
the early recovery of additional cashable savings. These savings added to the
capital receipts from the sale of redund
ant depots and the transformational
efficiencies attributable to the depot gives this project a 7 year pay back period.
Whilst additional borrowing may be necessary, every effort will be made to maintain
costs within the original budget.



Legal & Risk Im
plications

L
egal and risk
matters

are stated in the Risk

& Issues Log

for the programme
which
is
available on request.



Impact Assessment

The programme
has been approved
previously
by
PFAM
Committee. It forms

part of
the Corporate Improvement Programme and links to the
Reshaping the E
E
&
C

Directorate
,

Mobile and Flexible Working

and Office Rationalisation

programmes
.


Consultation

The pro
gramme

has formal
programme
management arrangements
.
Extensive
consultatio
n takes place with all stakeholders on a regular basis
.


1.0

Introduction



1.1

By way of
brief
background, a
fter development of a depot rationalisation
strategy during the period 2008 to 2010 and extensive consideration of all
the
options for providing a new facility for the first stage
-

central Fife
-

a
pprov
al
was given

by PFAM Committee

in June 2010

for
the acquisition of the former
ADC building at Bankhead, Glenrothes
and

its adaption into an integrated
depot facility for
ce
ntral
Fife operations
.

The activities concerned are cleansing
and waste management, landscaping and grounds maintenance, roads safety
and maintenance, buildings maintenance and renewal, vehicle maintenance,
supplies procurement and storage.
These services
are
currently
provided from
a range of facilities across Fife

which are not fit for purpose and costly to
maintain and
operate
.




1.
2


The strategic aims of the
Depot Rationalisation Programme
are
:




to identify, design and deliver an integrated fit for pu
rpose facility
at
Bankhead




for Bankhead to
act as a
major transformational
change enabler for
integrating

services
, reduc
ing

duplication

and

deliver
ing

optimum
business efficiencies

over the years ahead




for Bankhead
to act as
the

enabler

for rationalisation of depot

activity

in
east and west Fife

as part of the developing transformational change
process
.




to provide

depots where the health and safety of the public and our
employees is a priority




to reduce carbon emissions as far as
practicable


1.3

In February 2012, PFAM Committee
considered
the

latest of a number of
report
s with a
revised business case for Bankhead. This business case
approved a total project cost of

£21.95 mill
ion noting that the project remained
self financing

with a pay back period of 7 years. The benefits associated with
the project have been identified as:




Integrated service delivery from 6 services operating from one facility
with £3million attached to savings identified in the ‘Blue Book’




Cost avoidance
in maintaining dilapidated depots

(many of which
contained asbestos)

of £7million in the short
-
medium term for either
statutory compliance or basic property maintenance

or improvement
.




Capacity to derive further financial
, environmental

and cultural benef
its
from business integration and re
-
engineering over the short
-
medium
term

contributing to further financial savings.




Enhanced longer term investment and planning in the workforce and
the local community supported through its activities

ie a sustainable
long term business planning approach
.




Capital receipts of £4 million from sale of vacated depots



2.0

Programme Update




2.
1

Since approval was given in June 2010 to the purchase of the Bankhead
facility, the following has been achieved:




Fit out of
c.30,000 sq ft of office space, and the relocation of all
Property, Catering and Cleaning and Transportation support staff to the
phase 1 office
.




Completed redesign of the internal and external spaces of the facility
and cost estimates for providing same.

This
result
ed

in 26 iterations to
achieve

design, operational and cost compliance over a
n 18 month

period.




Obtaining planning permission and managing out risk and potential
costs.




Finalising project costs with the contractor, Building Services
.




En
suring energy efficiency aspects are taken into account to reduce the
carbon footprint of the new facility compared to the older ones.




Establishing a framework for implementing best practice Facilities
Management arrangements using the facility as an exem
plar for other
Council facilities.




Developing a move management plan and supporting business
continuity for both moves and implementation once operational.




Reviewing existing processes and changing them to ensure they are fit
for purpose for the new inte
grated facility and identifying associated
savings. Areas being examined currently include
central and Bankhead
stores

operations and ancillary depot support processes.






Undertaking options appraisal for use of surplus space


2.2

Next steps are as
follows:




Refitting phase 2 offices which will house Building Services s
upport
s
taff

in the
next

move phase followed by staff from other services. Work
commenced on this refit 2 months ago and will be complete by the year
end.

Moves will start thereafter o
n a phased basis.





Agree
ing
the final cost of the project with the contractor, Building
Services
during September

and let the contract
.




S
igning off the construction contract with Building Services for works to
commence in September 2012.




Continue developing benefits strategy to ensure business case
compliance


from the stores and the surplus space projects. The
former is at an advanced stage and will yield financial benefits from
process
and operational
improvements. The latter will yield

benefits as
current projects gain momentum: archiving and document storage,
museums and libraries storage
,

and third party use.




Continue developing the FM arrangements as described earlier.




Consider the utilisation of other depots in the context of Bank
head with
a view to seeking further savings through integration and efficiencies.


2.3

A
ll projects in the programme are compliant and are focussing on the benefits
expected of them. Planning permission
was granted
by Glenrothes Area
Committee
on
15 August

2012
. As well as removing one of the key risks in the
programme allowing development now to proceed, the terms of the consent
ha
ve

removed a potential cost from the programme provided for in the last
Business Case
as

a provisional sum of £750,000 for infr
astructure
improvements.
Whilst approval was given by PFAM Committee in February
2012 to a revised business case to meet a total project cost of up to £21.95M,
every effort is being made to maintain costs within the original overall budget.
The additional

financial headroom provided by the revised business case
exists to manage risk.


2.4

The wider benefits of the programme, involving investment in a sustainable
business strategy for local service delivery,
and
local employability involving
c.2000 staff an
d dependent and partnering local business
es,

remains a strong
driver to the success of this bold
transformational change programme
.
Being
used as an exemplar by the Scottish Futures Trust of integrated service
delivery and frequently visited by other local

authorities perhaps also provides
some indication as to the merits of the Council’s continuing approach

and
commitment to this programme.





Report
contact


Author Name: Iain McGregor

Asset and Facilities Management Services


Telephone: 08451 555555

ext
440
286

Email


iain.mcgregor@fife.gov.uk