Decision details
JOINT CUSTOMER SERVICES HUB - BUDGET UPDATE
Decision Maker: Cabinet
Decision status: Recommendations Approved
Is Key decision?: Yes
Is subject to call in?: Yes
Purpose:
To approve an increase in capital expenditure to deliver a joint customer services hub at Blueschool House.
Decision:
THAT:
(a) £50k be allocated from the ICT revenue reserve to provide sufficient ICT
equipment at Blueschool House;
(b) £200k be allocated from the earmarked economy, communities and corporate
revenue reserve to support the increased costs;
(c) having regard to the continued revenue benefits identified in the revised
business case, a further £720k be approved to deliver a joint customer
services hub at Blueschool House, bringing the total estimated cost to £1.92m;
(d) the audit and governance committee be asked to identify and recommend
improvement actions to strengthen property capital project management and
control.
Reasons for the decision:
On 2 June 2016, the cabinet member contracts and assets approved the
establishment of a joint customer services hub at Blueschool House in Hereford. The
project involved DWP co-locating with council staff, generating a revenue income for
the council resulting in a reduction in the net premises costs for the council.
As investigative and refurbishment works have progressed it has become apparent
that the original capital estimate for the project is insufficient to deliver the full scope
of requirements. Value engineering exercises are ongoing to ensure best value is
achieved, however the current project estimates total £1.92m (an increase of £970k
relative to the original estimate).
Alternative options considered:
Not to approve the increased capital budget. This is not recommended as significant
work has already been undertaken, further work would in any event be required to
reinstate the building to a useable standard, and expenditure to date would become
abortive. This would result in unbudgeted revenue budget pressures from the abortive costs and the non-delivery of the revenue saving project. It would also have
operational implications for both the council and the Department for Work and
Pensions (DWP) who will be co-locating to the refurbished Blueschool House.
Additionally there may be further costs incurred as a result of early termination of a
contract.
Not to invest in appropriate ICT at Blueschool House. This is not recommended as
existing ICT infrastructure is limited in terms of efficiency and flexibility. The ICT
investment will facilitate improved working practices including agile working.
Reason Key: Expenditure;
Contact: Andrew Lovegrove, Director of Resources and Assurance Email: Andrew.Lovegrove@herefordshire.gov.uk.
Publication date: 28/07/2017
Date of decision: 27/07/2017
Effective from: 04/08/2017
Accompanying Documents: