The Scottish Parliament

The Scottish Parliament Starts on next page

The Scottish Parliament

The Scottish Parliament September 2000

The Scottish Parliament Holyrood Report, Fraser Chapter 8 page 97

The Scottish Parliament Scottish Parliament Project Organisation Structure 2000 Multi Headed Client, Fraser Report Chapter 12 page 194

The Scottish Parliament Other Parliamentary buildings http://www.scottish.parliament.uk/business/research/briefings-03/sb03-52.pdf

STANDARD PROJECT MANAGEMENT TECHNIQUES The Scottish Parliament (adapted from Meredith et al, 2004 and Fraser, 2004)

The Scottish Parliament (adapted from Meredith et al, 2004 and Fraser, 2004)

The Scottish Parliament http://www.scottish.parliament.uk/business/research/pdf_res_notes/rn01-64.pdf Mr Davidson drew a number of conclusions in his report including the following; “…it must be noted that in costing terms the Spencely Report indicated a realistic price range expectation of £195 Million to £230Million. This was at a stage when some of the design difficulties were not fully designed through. The conclusion from this is that the motion put to and passed by the Scottish Parliament, known as the “Jackson Motion”, which was for a fixed cash sum at current prices of £195 Million, was somewhat optimistic and, in light of the complexity of the tender and control process inherited from the previous Scottish Office Administration, naïve for such a complicated and indeed unique design.”

The Scottish Parliament http://www.scottish.parliament.uk/business/committees/historic/audit/reports-00/aur00-06-03.htm#ana01 • 28 SEPTEMBER 2000. • At the Audit Committee meeting on Tuesday, 26 September, Muir Russell agreed to provide notes on a number of issues that were touched on during the evidence taking session on the Auditor General for Scotland's Report on the new Scottish Parliament Building. • I thought it would be helpful to put in writing the areas on which the Committee is expecting to receive clarification. These are: • Details of the person specification and recruitment method adopted for the replacement project manager

The Scottish Parliament RESPONSE • Appointment of Project Manager • As Dr Gibbons and I told the Committee, we were able to minimise the gap following the resignation of the former project manager because the project team was clear about the type of person and experience needed for project manager in the circumstances of this project and a suitably experienced person was available to transfer to this role. He was at that time project manager on the interim Parliament project (the Mound), performing successfully in that role, so he was a known quantity. • His appointment to that post followed a decision to establish separate project management for the interim Parliament project, to ensure its successful delivery and to enable the Holyrood project team to concentrate on the main project itself. He was appointed after discussion with a number of project management companies on how best to secure the capability to move the interim Parliament project forward quickly, and was seconded from Project Management International Plc, of which he was and remains an employee, with reimbursement made to the company

The Scottish Parliament http://www.parliament.uk/commons/lib/research/notes/snpc-03357.pdf • Lord Fraser highlighted in the Holyrood Inquiry that: • …the £40 million figure could never have been a realistic estimate for anything other than most basic of new Parliament buildings. However, what can be stated clearly is that at the time £40 million was included in the White Paper, there was no clear understanding whether that was a total cost including professional fees or only a construction cost. It was certainly not explained to the Scottish public what the figure

The Scottish Parliament • The Auditor General Report of 2004 made the following conclusions: • Spillage • The main cause of the 20 months delay to the project since September 2000 was the • production of detailed design variations and the late supply of information during the • construction process. • Cost Increases • The main reasons for construction cost increases after 2000 were design development • and delay in the construction process. The design development was entirely related to • realising the detail of the building and aspects such as the quality of finish and the • palette of materials that were used, in accordance with the client’s requirements. • Project management and control • Although it is likely that a high quality building is being delivered, the time and cost • objectives have not been met. The same quality could have been achieved for less if • the whole design and construction process had been better executed.

The Scottish Parliament Summary of the Holyrood Inquiry’s Conclusions and Recommendations • The Holyrood Inquiry was published in September 2004 by Lord Fraser. • One of the principal conclusions found in the Holyrood Inquiry was that “whenever there was a conflict between quality and cost, quality was preferred”. • Lord Fraser further concluded that since Donald Dewar was determined in building a new parliament for Scotland as soon as possible, the timetable dictated the high risk and “fast track” procurement route. • In regards to the procurement method adopted, there was an inadequate level of evaluation or understanding of the construction management route; subsequently ministers were not informed of all the risks involved.

The Scottish Parliament The Origins of the £40 million Figure The evidence before the Inquiry is reasonably clear that this figure originally came from Mr Wyllie. On 10 June 1997 he minuted Mrs Doig with his costing of the option of onstructing a new building on a greenfield site. Assuming a building with an area of 15,000m² gross (11,250m² net – a net to gross ratio 25%) including 1,000m² for the Chamber, 3,000m² for Committees and Ministers and 11,000m² for the remainder, he put forward figures “in the order of £35-40 million”.His minute made it clear that the figures included professional fees, fit out, furniture and VAT although the position in this respect contrasts with his written recognition in which he said that his figures had “excluded site works, fit out, professional fees and VAT”. In a further minute of the same date to Dr Gibbons he elaborated on that range of figures as follows: Holyrood Report, Fraser, Chapter 3 Page 23

The Scottish Parliament http://www.scottish.parliament.uk/vli/holyrood/inquiry/sp205-11.htm#1 Was a ‘Pause’ Recommended? • Within the Spencely Report there is no specific recommendation for a two month pause in the Project to enable a costed design to be achieved. However, in evidence Mr Spencely explained that the eight week pause was implicit within paragraph 5.4 of his Report: • ‘It is clearly imperative that the Brief is frozen now and that the Design Team proceeds immediately to produce a Scheme Design including a cost plan to a Brief and a budget approved by the client, so that approval may be given to proceed with the Project by 8 June 2000.’ • There has been some uncertainty amongst witnesses as to whether SPCB members were aware that Mr Spencely was recommending a pause. During a discussion of the Report’s findings at the SPCB meeting on 28 March, Dr Gibbons advised that: "Detailed design and construction would continue to run in parallel and there was no reason for a pause until 8 June." There is also reference to Mr Spencely recommending one option as: "the cessation of all project activity for a period of three months" in the SPCB’s report to Parliament,

The Scottish Parliament • In relation to the functions of his suggested "Progressing Group" Mr Spencely’s evidence was as follows: • "I expected the Progressing Group to operate as the Client — receiving reports and recommendations "upwards" from the Project Sponsor and acting on the latter — to accept, modify or reject; and receiving and sifting requests for variations to the Brief "downwards" from MSPs and Parliamentary staff; all in the light of the Budget and the Programme; and to control Budget expenditure and Programme by making the appropriate management decisions".

The Scottish Parliament http://www.scottish.parliament.uk/vli/holyrood/inquiry/sp205-10.htm#3 • In his oral evidence Dr Gibbons, when asked about viability at handover, said: • "From what we know now, it clearly was not." • I am bound to conclude that: • 1. The Brief was not up to date, and did not reflect the changes made since November 1998. • 2. The Brief did not anticipate the requirements of the Parliament with the inevitable result that adherence to it would have produced an unsuitable building. • 3. The budgeted construction cost of £62 million was flawed in that: • a. there was inadequate accounting for risk, and the stated budget bore no relationship to a cost plan;b. there had been a failure to fully appreciate the complexity of the design; andc. account had not been taken of considerations of blast and security. • In short, the Project was not in a viable and healthy condition when it was handed over to the SPCB on 1 June 1999.

The Scottish Parliament http://www.scottish.parliament.uk/vli/holyrood/inquiry/sp205-14.htm#12 Impact on Overall Cost and Programme • 13.77 There is no doubt that by having to focus on specific recurring themes in relation to Queensberry House, the HPG and the Project Team found it difficult to make progress and that these issues were discussed at the highest level by the First Minister and Presiding Officer to try and find a resolution. Crucially, however, it is to be noted this did not cause any delay to the overall programme, as Queensberry House was never on the critical path. At the same time the costs of Queensberry House have been significantly greater than anticipated at the outset.

The Scottish Parliament • http://www.scottish.parliament.uk/business/committees/audit/reports-04/grice-auditrep.htm Adequacy of Cost Plan • AGS’s comments in paragraphs 4.3 – 4.7 of the report reflect a misunderstanding of the purpose of the Cost Plan at Stage D. Such a plan is needed to translate the Stage D design into individual works packages and to estimate the value of the works under each package. This provides a basis for project management and the consultants to compare the values of tenders based on the Stage D design. The adequacy of the Cost Plan for this purpose is reflected in the fact that, on average and after allowing for inflation, tenders on which contracts were based were within 5% of the Cost Plan Estimate. In view of the uncertainties identified in Exhibit 9, this could be regarded as a reasonably satisfactory result.

The Scottish Parliament http://www.scottish.parliament.uk/business/committees/historic/finance/or-02/fi02-2502.htm • Alasdair Morgan: I find it difficult to understand why the target date has not only slipped three to four months since last you gave evidence on 8 October, but has become less certain rather than more certain. • Sarah Davidson: The current target date of best completion at the end of August, which means that everything will have happened to the best possible outcome, has the same status as the previous date of the end of April. • Alasdair Morgan: Do you have a worst possible outcome date? • Sarah Davidson: No. • Alasdair Morgan: What kind of Gantt chart is used? Some kind of worst-case scenario must have been considered. • Robert Brown: The object of the exercise is to finish the thing as quickly as possible—that is clearly what we are after and the progress group is keeping on top of the contractors to try to ensure that that happens. However, as we have already explained, the business of the glazing and blast proofing could have had a dramatic effect on the progress of the contract. Had last Friday's blast test failed, we would be coming to the committee today to report a serious situation; there are no two ways about that. Happily, the blast test was passed. Although we have to take account of the fact that the test had to happen in the first place, that is part of the risk review that is taking place at the moment. The major concerns that we would have had if the blast test had failed have not materialised. We are therefore able to come to the committee with good news on that particular point because passing the test removes what was probably the single biggest risk that remained on the contract.

The Scottish Parliament