The report was noted.
Burns presented the report to inform the Committee of the Swansea Bay City Deal
Quarterly Monitoring report for both the Swansea Bay City Deal Portfolio and
its constituent programmes/ projects.
Burns also explained that the quarter 4 financial report is not present as it
needs to go through program board and joint committee and considered for Joint
Scrutiny Committee at a future date.
feel there are substantial risks on the RAG status as stated on page 2 of the
report and wanted to know what the mitigations were.
agreed that there are seven red risks and advised that the risk register has a
mitigation in place for each risk. Some of the risks aren’t controllable by the
Swansea Bay City deal and a watching brief is kept on those. Officers explained
that for the ones under control of Swansea Bay City deal there are mitigations
in place, at least for monitoring of the risks. There are also mitigations such
as course corrective action in some cases.
were concerned about private sector funding contribution not being in line with
business case projection and the slippage in delivery programme against key
milestones. Officers explained that at a portfolio level, private sector funding
is a red risk as £600,000,000 of funding is private sector funding. This is why
at a portfolio level it is at a red risk, however, no project within the
portfolio is identified as a red risk.
explained that in relation to the slippage, all infrastructure project’s
nationally have been affected by delays caused by issues such as contract
negotiations taking longer and increased costs. A construction impact
assessment is ongoing to try monitor and mitigate against rising construction
costs and slippage which tend to coincide.
referred to the amount of value engineering, especially the waterfront
refurbishment where it is refurbishment rather than re-build. Officers advised
that a change management process would need to take place, this would mean
also asked about whether some projects would start suffering because of these
explained that they can only when things go out to tender do projects know if
there is a problem. The construction impact assessment highlights a gap of
£31,000,000 that needs to be plugged. Officers advised that the mitigations
against that are value engineering and gaps are also plugged by the host
authority. Officers advised that they are looking at what mitigations can help
were informed that on each of the project statuses included in the report.
Officers explained that there are 9 headline projects and programmes and within
those are 35 projects. Of these 3 are complete and in operation, 17 are in
delivery and build started. This equates to approximately £400,000,000 of
investment. Officers also highlighted that 15 of the 35 are in pre-commencement
asked about the homes for power stations and asked if the risk should go to
amber from red as there is only one member of staff left to employ. Officers
explained that it was just a lag due to the timing of the report and they are
now fully staffed. The next report will be updated with a green for this
asked for more clarity on the project status or Generalized Activity
Normalization Time Table (GANT). Members sought
clarity if it was the status of the business cases or the status of projects.
clarified that it was the delivery of projects such as procurement activity,
these could be pre-commencement stage, going into build.
pointed out an issue with the diagram on the report. Officers clarified that
the diagram in the report was not complete, and they would course correct the
report for the next meeting.
requested clarity on the project status reports and indications of what the
risk mitigations are so that the committee can appreciate the status of aspects
of the City Deal better.
also asked for an update on the number of total jobs created as mentioned in
the appendix. Officers said that they believe the number is currently 550, an
increase on what the report states of 536. Officers advised that jobs need to
have run for at least a year to confirm they are longer lasting jobs before
they can be included. The number of jobs created is much higher in all likelihood. Officers stated that only after an
independent economic assessment on the impact on City Deal will they be able to
ascertain the true impact on job creation.
were advised that the economic and job impact is yet to be scoped out until
certain milestone evaluations have been done. This hasn’t been instigated by
Joint Committee yet. governance and process must be gone through first before
this can be instigated.
advised from an investment perspective they are up to 22% of the overall
investment target which is £271,000,000 and the updated reports that will come
through will hopefully progress that as they go through the year.
asked to clarify if this report was a snapshot in time and wondered whether the
£31,000,000 figure was an arbitrary figure due to the number of estimates
included. Officers confirmed this was a snapshot in time and said there were
quite a few procurements not in a stage where they could estimate the gap.
also stated that the figure is a minimum as the price of things will be
unlikely return to a level of two or three years ago and it’s difficult to
ascertain how much things have gone up until procurement.
also wanted clarification on whether this included the materials as well as
employment costs as well. Officers confirmed it included everything.
enquired how much was allocated to the builds alone, having commissioned quite
a few companies to start the build process on several projects. Officers didn’t
have the figures to hand but can find that detail out.
asked how many tier 1 contractors are based in Wales
(had a head office based in Wales). Officers were uncertain but didn’t believe
many would have a head office in Wales although they are based here during the
builds and are talking about a longer-term presence in the area in the future.
Officers said they can look at asking these tier 1 contactors about this.
said that one of the early Committee discussions was the hope that contractors
would be grouped together so that they can burden the liability of the costs
associated with the build and put in a tender that would be a viable to be a
tier 1 contractor among 3 or 4 of them. Members advised that, that hasn’t come
wanted to know if was down to the market in Wales or if that was a failure on
the City Deal to ensure that the projects were packaged as a whole site tender
rather than packages of tenders.
advised that they are a collection of tenders and gave the example of the
waterfront in Swansea. These will be the hotel, Arena and Kingsway and the
Matrix and Precinct, they are all separate packages within the same business
case. Officers explained that these would be broken down into subprojects
within a project or program but even with some of the projects they would go
over the scale thresholds that some local suppliers would be able to tender
were concerned that for benefits realisation, especially for jobs that
especially men in the construction sector are used to working away and stay
somewhere during a week and go home at the weekend. The members expressed the
concern that when that project is finished what are the jobs going to be
stated that so far most of the spend and benefits has been around construction
and if that is not benefitting Welsh companies and Welsh workers then it must
be questioned what the benefit realisation is of the locals as part of this
stage of this scheme.
advised that there have been over 200 local supply chain contracts, this would
be the tiers 2 and 3. These are all with local companies who will all
contribute to City Deal and grow their own companies.
noted this but were concerned that the tier 1 contractors would take an element
of profits and had there been more Welsh tier 1 contractors then potentially
there would be more of the Welsh pound staying in Wales.
explained that tier 1 and tier 2 contractors are reluctant to bid for contracts
at the moment and there is a need to get
subcontractors involved and growing them and making sure they are able to
prosper going forward. Officers also explained that even with the
sub-contractors, their books are full and there is a lack of supply of manpower
that is driving the lack of companies able to bid for contracts.
explained that the hope was that many companies would have popped up in
response to this massive investment and/or for the bigger companies locally to
grow. Members stated that the question is how do they grow to the size to take
on the large projects?
said that it might be that a conversation is needed where it can be drilled
down on the benefits realisation in constructions and a paper on subcontractors
and Welsh Jobs etc.
explained that the problem with construction would always be there because
construction moves around the country and therefore so do the workers. The
long-term employment needs to be looked at because the short-term employment is
an issue as there aren’t any Welsh construction tier 1 businesses based here.
The transient nature of construction means that the construction jobs will
always only be short term.
also wanted to know about the value added on the wider benefits of the project
and would be interested to read the report that officers stated would come
later in the year.
also stated that the projects will have a shelf life longer than the period of
the City Deal and those jobs should hopefully stay for many years to come, but
currently most of the jobs are in construction and the idea is to try squeeze
as many benefits as possible out of that element to ensure value for money.
advised that one of the areas of skills and talent is the construction industry
sector, particularly around innovative ways of construction. Officers explained
that they will develop a highly qualified workforce because of the pilots and
the apprenticeships and ideally those people will be kept here in the Welsh
highlighted that the UK Government had provided more investment via skills
through other pots created and wanted to know if the local authorities and the
officers have had discussions to ensure that the skills programs are being
married up in a way that avoids duplications.
said that they believe that is happening via the regional learning skills
partnership and with the partners around levelling up as well. Officers also advised
that there are other opportunities for skills development there.
The report was noted.