readiness to deliver assessment report for sutton’s bsf ......3.2 recruiting a programme director...

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Readiness to Deliver Assessment report for Sutton’s BSF Programme

7th January 2009

Agenda Item 5Page 25

Contents

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1. Introduction & Scope of Report 1

2. Review of Current Position 3

2.1 Strategy for Change 3

2.2 Estates Strategy and Planning 4

2.3 Commitment to the BSF Model 6

2.4 Project Management 7

2.5 Support Network 8

2.6 Corporate Capacity 9

2.7 Key Stakeholder commitment and consultation arrangements 10

2.8 Risk Management 11

3. Requirements for Readiness to Deliver by March 2009 13

3.1 Establishing an Implementation Budget 13

3.2 Recruiting a Programme Director 14

3.3 Preparing to Mobilise the BSF Programme Team 14

3.4 Developing Programme and Project Visioning and Transformation Management 15

3.5 Preparing for Procurement 16

3.6 Gearing up schools’ commitment 17

4. Conclusions from Review 18

5. Procurement Options 19

5.1 Local Education Partnership 19

5.2 PfS National Framework 21

5.3 Improvement and Efficiency South East (IESE) 22

Appendix A - Action Plan for Readiness to Deliver by March 2009 1

Agenda Item 5 6

Sutton BSF – Readiness to Deliver Report

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1. Introduction & Scope of Report EC Harris has assisted Sutton in undertaking a review of the Council’s Readiness to Deliver for its proposed BSF programme following submission of the Council’s revised Expression of Interest in November 2008. We have utilised the assessment criteria for Partnerships for Schools’ (PfS) Readiness to Deliver Gateway Review process. The key findings from our ‘health check’ are based on the review of documentation and the outcome of interviews (some by telephone, some face-to-face) conducted recently with the following officers and other key stakeholders: Peter Simpson - Executive Head of School Improvement, Children,

Young People & Learning Services (CYPLS)

Hugh Betterton - Lead Inspector, Secondary

Sharman Lawson - Executive Head of Parent, Pupil and Student Services, CYPLS

Stephen Ingram

- Executive Head of Service Management, CYPLS

Councillor Tony Brett Young - Executive Councillor, CYPLS and Communications

Charles Ward - Principal Lawyer

Paul Algeo

- Head of Major Works and Procurement

Anthony Reeves

- Chief Accountant

Nigel Simms

- BSF One School Pathfinder Project Coordinator, CYPLS

Ian Birnbaum

- Strategic Director, CYPLS

Jane Pascoe

- Chair of Governors for Stanley Park High (BSF One School Pathfinder)

Alex Thomson - Deputy Headteacher, Stanley Park High School (BSF One School Pathfinder)

John Russell

- Diocese of Southwark

Gary Shambrook - School ICT Development Manager, CYPLS

Robin Campbell

- Head of Communications

This Readiness to Deliver Health Check (Section 2) provides Sutton with a report on each of the core assessment criteria and outline where they currently are and where they need to get to be ready to start their BSF programme. The key findings from our review that have informed our assessment of what the Council needs to focus on during the period January – March 2009 are set out below (Section 3) under the headings following the Readiness to Deliver Assessment Criteria used by PfS. In Section 4 we have



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summarised the overall conclusions we have reached and Section 5 offers our preliminary assessment of procurement approaches. It should be noted that the report provides an overview and is not intended to record every point raised by those interviewed but to provide a summary of the key findings. Definitions We have used several terms in this report that make reference to the type of projects; for clarity their meanings are described below – § Initial Projects/Initial Programme – under the revised prioritisation of BSF projects

from next year the Initial Projects or Programme of a capital value of from £80 to £100 million that each wave 7-15 authority has applied for.

§ Follow On Projects/Programme – These are the projects or programmes that

authorities will possibly receive funding for to complete their BSF programmes at a later date.

§ Programme Director/Manager – the person responsible for the overall direction and

delivery of Sutton’s BSF Programme as a whole including the Initial Project and subsequent projects (i.e. Projects 2 & 3 as set out in the Borough’s Expression of Interest November 2008).

§ Project Manager – the person responsible for delivering a specific project, i.e. a

school or group of schools ‘bundled’ together as in Sutton’s proposed Initial Project.

§ BSF Steering Group – the group of Sutton headteachers, governors, elected members, diocesan representatives and local authority officers that is developing the vision for secondary education in the Borough.

Important note about requirements for Readiness to Deliver We have heard informally this week from Partnerships for Schools (PfS) that they may be changing the BSF Readiness to Deliver requirements to include completion of Strategy for Change 1 (SfC1). This is therefore likely to increase the amount of work a local authority will need to undertake in order to achieve the required state of readiness to deliver the Initial Project as proposed in its Expression of Interest submitted in November 2008. The basis of our assessment of Sutton’s Readiness to Deliver, as set out in this report, however, excludes any such new arrangements for SfC1 that are yet to be confirmed by PfS. Developing the Strategy for Change is a significant piece of work and will need a substantial investment of local authority officer time over and above that estimated in our suggested Action Plan for Sutton (Appendix A). With this in mind we would recommend immediate attention to SfC1 to ensure compliance with the likely changes to PfS’ requirements.

Agenda Item 5 Page 28


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2. Review of Current Position

2.1 Strategy for Change Strategy for Change – a review of how well placed Sutton’s education strategy is compared to the national and local policy objectives that PfS and DCSF set. What we found

§ Senior management recognition of the importance of BSF in supporting the educational provision for future transferable skills for ‘sustainable learners’ and the need to adapt the schools infrastructure to changing curriculum needs.

§ Good experience from the One School Pathfinder (Stanley Park) on how Sutton has developed a clear education vision for the school, but as yet this approach hasn’t yet been applied to schools identified to form Sutton’s Initial BSF programme.

§ Sutton’s OSP has extended services that can act as a model for developing Sutton’s vision for extended services across the rest of its secondary estate. Stanley Park has been piloting new ways of working and teaching practices in the existing building prior to moving into the new school buildings, an approach which is good practice.

§ A BSF Steering Group was established in September 2008, which includes a representation of Secondary Heads, Dioceses, Governing Body Representatives and key Sutton officers. The Steering Group has already implemented a visioning session with all Secondary Heads, Dioceses, Chairs of Governors and key Sutton officers. The second of these visioning sessions is taking place in early January 2009.

§ Further thinking on ideas such as an ‘education’ or ‘learning’ ‘village’ (noted in some of the interviews) need to be developed.

§ The BSF OSP Project Coordinator has been tasked to report back to the BSF Visioning group on the approach to stakeholder engagement utilised on the OSP project. The approach needs to be tested and developed for use on the BSF programme.

§ Work has just started on thinking about what BSF means for education transformation in Sutton. The high performance of many of Sutton’s schools is acknowledged as is the need for education transformation for all to be at the heart of the Borough’s approach to BSF.

§ We see the need for schools to build on what they have already done in supporting each other in BSF and being given the opportunity to develop their ideas for shaping future education provision in the Borough.

§ SEN and Inclusion do not appear to be fully integrated into the vision for transformation.

§ We have noted the emphasis, within the Initial Project, on provision for students with Special Educational Needs. We understand also that officers are in the process of



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writing a new Inclusion Policy that will deal with the issues raised in the Joint Area Review undertaken in 2008.

§ Evidence of strategic planning and commitment to ensure that the use of ICT within the Borough supports the Every Child Matters agenda as well as the wider Sutton Strategies and Plans. We recognise that Sutton has invested heavily in developing a ‘future-proof’ Wide Area Network (WAN) for schools and other Council sites.

What needs to be done

§ Further work on developing the LA’s education vision as well as school visions for the Strategy for Change. This to include ensuring that the revised Inclusion Policy is woven into both the Initial Project and the BSF Programme as a whole.

§ Greater emphasis on the teaching and learning aspects of ICT to ensure that developments are accommodated easily in to the existing infrastructure.

§ Explore further how extended services will be enabled through the BSF investment.

§ Further provision of workshops and seminars to enable and encourage stakeholders to ‘think outside the box’ and explore what transformation really means – both for individual establishments and for the Borough as a whole.

§ The appointment of a ‘Transformational Manager’ (see Section 3.4 below) to lead and maintain the work of the BSF Visioning Group.

§ Until a BSF Project Board is established it may be prudent to strengthen the remit of existing BSF working group arrangements and to scope the role and responsibilities of the Project Board to ensure a proper framework for governance, accountability, resourcing, stakeholder management and focus on achieving BSF outcomes.

2.2 Estates Strategy and Planning Estate strategy and planning – testing that Sutton has a robust estates strategy that is backed up by AMP data with a co-ordinated ICT strategy. In addition how well Sutton has identified the improvements in the estate required and how these improvements will deliver a step change in attainment and social regeneration. What we found

§ There is an increase in the need for primary places due to an increase in the birth rate and need to provide more places for Sutton students who are opting to take up places at schools within the Borough rather than in neighbouring local authorities..

§ There could be the need for expansion of more than two forms of entry at each of the secondary schools in the Borough, but further birth rate data are required to confirm trends. This possible expansion is yet to be explored in detail with the schools as its impact on the wider estate and organisation of schools across the Borough.

§ Recognition that there are ‘pockets of buildings’ around the Borough in need of consideration of rationalising for service improvement.



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§ Location of schools – many are located on the periphery of the Borough and this may have implications for increasing overall capacity to deal appropriately with the increased demand mentioned above.

§ Recognition of the challenges involved in increasing the capacity of secondary schools on existing sites and therefore of the need to be creative in finding appropriate solutions.

§ Currently the school estate is managed by the Children’s Services Directorate and any projects are developed up to Stage C by Children’s Services but then developed, procured and delivered by Construction & Property. An alternative approach, which accords with PfS requirements, will need to be considered for the BSF programme.

§ Condition survey data across the school estate are in need of updating, Sutton is planning to procure the surveys next year but these have yet to be instructed. Suitability data were updated in 2005/06 and Sufficiency data are updated annually.

§ The improvement of the education estate to enable BSF to have maximum impact on raising educational achievement needs to be more clearly established as a priority for the Council.

§ Recognition that the use of capital receipts for helping fund or reduce funding shortfalls in capital projects will be more difficult in the current economic climate.

§ Evidence of support and focus on ICT infrastructure and technical capabilities of schools.

§ Whilst Sutton has not completed any PFI projects, which limits its inherent experience around BSF and PFI procurement, Sutton is, however, currently engaged in a PFI programme for its Waste Management facilities, which will help prepare and inform the authority for BSF.


§ Further review of existing sites, both primary and secondary, to fully exploit all available site capacity to ensure there are adequate pupil places available for future increased rolls.

§ The impact of the latest birth rate data and consideration of any potential school organisation issues (for example on whether to maintain single sex or a move to co-educational provision throughout) will need to be incorporated in the Borough’s BSF Strategy for Change.

§ Further support for Councillors in aligning capital funding strategies with service plans to facilitate improvement and transformation of service provision.

§ Develop more intensive corporate approach to identifying sites for service needs – e.g. ‘earmarking’ the capital receipts that are possible to support BSF.

§ Set up officer working group to look at creative ways of funding capital or the implementation costs of managing large programmes such as BSF.



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§ Condition, Suitability and Sufficiency surveys need to be undertaken on the proposed initial BSF projects as soon as practically possible to inform the Estates Strategy and Feasibility Studies required as part of Strategy for Change 2 that would take place from approximately June/July 2009 (if Sutton is successful in its EOI submission).

§ Land title reviews are required for the Initial Projects and this process should commence as soon as possible as boundary, covenant, way leave information can take time to locate and analyse.

§ Explore the potential implications (FM, TUPE, Financial etc.) of utilising PFI procurement on any of the schools that could be complete new build as this is the default model for complete new projects if they are delivered through a LEP.

2.3 Commitment to the BSF Model Commitment to the BSF model – that Sutton understand the procurement and funding arrangements and that they have in place the structure to mange these. In addition that Sutton understands and has planned for the impact of an estate wide ICT managed service. What we found

§ Sutton has its own partnership contract framework – PPC 2000 – involving 4 consultants and 4 contractors. With the exception of the Waste Management facilities, the authority has not procured any major PFI capital programmes like BSF in its recent history.

§ Stanley Park OSP has been procured under mini-competition with local ownership through the IESE Framework – scoring of bids involved governors and headteachers

§ Officers recognise that the LEP route would take considerable time and resources to procure. Many officers (particularly in Property, Legal Services and Finance) are not very familiar with the LEP as a procurement vehicle.

§ We understand there are a number of ICT technical and educational visions that will need to be reviewed in further development of the BSF programme as a whole.

§ Sutton currently provides a central, managed ICT service to every school in the Borough, albeit on varying scales. The schools are very pleased with this service that has recently been assessed as the best in the country in terms of user satisfaction. A LEP, however, provides ICT managed services by ‘default’ and this could have implications for existing contracts/service level agreements that are yet not understood or tested.


§ Scope the BSF programme as a whole to determine exactly what is required of the ‘procurement vehicle’. If Sutton is to have a LEP consideration is needed as soon as possible of other possible capital programmes that could be procured through the LEP to make it more viable, although at present there don’t appear to be many possible options.



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§ We have given some preliminary information, in Section 5 of this report, on the features and likely orders of costs of three procurement models. However, the detailed characteristics and estimated costs of these, together with the advantages/disadvantages of each, will need to be considered in the light of the scope of the programme as a whole as well as of the Initial Project. We have set out in Section 3.5 of this report the immediate tasks we recommend Sutton to take to identify the most suitable procurement vehicle for its BSF programme.

§ We have set out, also in Section 3.5 of this report, a number of criteria to be applied in determining the appropriate procurement approach. These will need to be further developed and agreed as appropriate with the Project Board and stakeholders and, where necessary, weighted and ranked to ensure they properly reflected Sutton’s chosen methodology for choosing the most suitable procurement route for its BSF programme.

§ Leads from Sutton’s Corporate Legal and Financial Services need to be identified for the BSF programme and these points of contact require training in the understanding of available BSF procurement routes. In addition, due to the lack of previous experience of major procurement the Legal and Finance teams need to build their understanding of both the legal and financial risks and issues associated with major procurement exercises including PFI.

§ Sutton should look at experiences from other authorities that have procured and delivered PFI schools under BSF to further understand the key issues with regards not just to legal and financial issues but to issues such as FM and TUPE.

§ Consideration should be given to linking up with other neighbouring authorities to assist with providing the ‘critical mass’ to make a LEP procurement more viable.

2.4 Project Management Project Management – that Sutton have identified the resources, organisational structure and governance to manage the business case development and procurement activities including member buy-in to the programme. What we found

§ The project management structure utilised for the delivery of the One School Pathfinder has set up the appropriate governance and commitment to the successful management of the project. This provides a solid foundation for which to build form for the BSF programme. However careful thought will be needed to turn it from the delivery of a single project to the delivery of a programme of projects requiring significantly more resources and a clear strategy for engagement with schools.

§ For Sutton’s OSP the school’s Assistant Head was seconded full time to help develop the project.

§ The schools identified to form the Initial BSF Projects have yet to address the issue of the amount of commitment that will be required from staff to develop their individual BSF projects.



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§ Whilst there has been good ownership at Member level for the Sutton OSP and this commitment appears to be in place for the full BSF programme, we feel there is a need for a greater sense of commitment and direction from Members specifically in acquiring an appropriate level of resourcing to manage the overall programme (as recommended in Sections 3.3 and 3.4 of this report).

§ Within the documentation on ICT there are significant commitments made to undertaking all the relevant tasks required. However, it is not clear from the documentation what progress has been made towards stating the intended objectives.


§ Children’s Services will need to develop a greater sense of ownership of the BSF programme through the development and implementation of a stakeholder management plan. It will need to put in place robust plans for acquiring the resources outlined in Section 3 of this report to enable it to be managed successfully.

§ In recognition of the importance of BSF and to enable corporate ‘buy-in’ and appropriate funding we recommend that support is secured from other Council Members in addition to the Executive Councillor for CYPLS.

§ Discussion will be required with the schools about the resources requirements. This will be at several levels within schools (including school business/finance/facilities management). The immediate task (as reflected in Section 3.6 of this report) is to ‘free up’ appropriate senior management time.

§ Prepare to recruit, internally or externally, a BSF Programme Director (as recommended in Section 3.2 of this report) ready to take up post as soon as practicable after approval is given to proceed with the Initial Project.

§ ICT – develop an output specification for the Initial Project to ensure that the benefits of the current ICT Plan are built upon, as a ‘one-size-fits-all’ approach will not be acceptable to stakeholders.

§ Sutton should develop an initial Project Initiation Document (PID) based on the PfS Template so they can start to identify the required project management governance, organisational structures, procedures and processes that need to be put in place prior to March 2009.

2.5 Support Network Support Network – Sutton’s planned support network from your own and external resources to ensure all work streams have the requisite expert advice. What we found

§ ICT infrastructure is reported to be adequate for current requirements but what about the needs of future learning and teaching?



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§ We have yet to see the educational assessment about the capacity of, for example existing ICT infrastructure, for new and creative forms of education provision – e.g. a ‘learning village’. The reference also to an ‘education village’ in the interviews suggests that further thinking is required to clarify the type of establishment suggested.

§ Whilst we recognise that Members are aware of the importance of the BSF programme as a whole we have not yet seen evidence of the degree of political commitment required to ensure that both the programme as whole as well as the first project are properly resourced.

§ Lack of clarity about how the implementation cost of the Initial Project would be funded. One view was that this would be self-funding, i.e. that there will be no extra funding available from the Council as a whole meaning that there could be major gaps in securing the required amount of support to manage the project.


§ Sutton need to consider what advisors they will require to assist them in developing, procuring and delivering their programme.

§ Sutton should make themselves aware of the available PfS Frameworks for Technical, Education, ICT, Legal and Financial Advisors, including the scopes of services required and the procurement processes to get their advisors on board in time to commence Strategy for Change.

§ Provision of additional internal resources as recommended in Section 3 of this report which includes the appointment of a BSF Programme Director, the establishment and mobilisation of a BSF Project Team with provision for a BSF Transformation Manager and senior management input from schools.

2.6 Corporate Capacity Corporate Capacity – review of Sutton’s corporate capacity to undertake major strategic investments projects with evidence of their ability to deliver including corporate procurement arrangements. What we found

§ Existing commitments on officer time will mean that the expectations of the Initial Project and of the programme as a whole cannot be met adequately from existing resources.

§ Concern by members and officers about the availability of council funding required to plan and implement the overall programme.

§ The record of high performance of some schools in the Borough may mean that, in comparison with other service needs, the need for capital investment in schools may not be seen as the highest priority.



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§ We found no evidence of an agreed structure yet in place for corporate support for Sutton’s BSF Programme.

§ No evidence of corporate support for or linkage with the CYPLS Team that is responsible for the ICT infrastructure that connects all schools in Sutton.


§ The contributions expected from corporate colleagues need to be scoped more accurately and appropriate funding (e.g. for internal Council re-charging) identified to ensure that the range of technical, financial, legal, property and other related services can be provided for the programme.

§ Corporate procurement rules will need to be aligned with the BSF processes and gateways. The internal approvals process, including Cabinet approvals, delegated authority levels for officers, scrutiny committee requirements should be detailed out and reviewed against the approvals that will be required for the BSF programme. This will ensure that the programme timeline can accommodate all the required approval periods.

§ The Council’s Legal and Financial Services in particular will need to identify any corporate level risks and issues associated with the typical procurement arrangements for BSF including the implications of PFI.

§ Consideration of linking with the wider, corporate needs and opportunities of the Council in ICT visioning and infrastructure planning.

2.7 Key Stakeholder commitment and consultation arrangements Key stakeholder commitment and consultation arrangements – assessment that key stakeholders have and will be consulted including review of your communications plan, consultation arrangements and resources for stakeholder management. What we have found

§ There is good experience and best practice used on the OSP project for mapping and engaging stakeholders.

§ Although a Steering Group has been established and some visioning work with wider audiences is taking place, there is yet no evidence of a planned approach to stakeholder engagement.

§ Varying degrees of stakeholder involvement – but we have not yet seen an overall comprehensive plan/programme showing how each stakeholder is to be kept fully informed.

§ No evidence of input from the One School Pathfinder to the ICT Education Strategic Plan despite recognition within this document that the development of ICT will “help to drive and shape education here in Sutton at all levels of activity”.



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§ Concern that the existence of high-performing schools may give a false impression of the overall educational performance of the Borough, i.e. that the need to address ‘pockets of deprivation’ may be missed.

§ No clear evidence of extensive ‘buy-in’ to the overall vision for the future of education provision in the Borough.

§ Concern about the lack of enough people in individual schools being involved in BSF opportunities. The demands of time and energy on staff at all levels and governors to contribute fully to their specific BSF project and to the programme as a whole, as well as to ensure the operational of the school, are recognised but needs to be scoped and planned and ‘dovetailed’ into the school’s operation.


§ Agree a list or ‘directory’ of key stakeholders and their interest and likely input to the overall project as well as to individual projects.

§ Undertake stakeholder mapping exercise to identify all key stakeholders and create stakeholder engagement plan in preparation for commencement of the programme in March.

§ Utilise experience and processes from OSP project on stakeholder engagement and develop for the BSF programme.

§ The internal Communications Team should start to build a Communications Plan for the BSF programme based on their experience of the OSP.

§ Engaging the schools to ensure that input at the right level (visioning as well as formulation of output specification) is available at the appropriate time for all aspects of BSF including ICT. Governing Bodies should consider carefully how to manage their schools’ engagement with BSF in order to capture the required amount of input and to ensure that this does not impinge on the operation of the school.

2.8 Risk Management Risk Management – ensuring that you have the processes and procedures in place to identify, manage and mitigate risks and that you have started to identify and record key risks for your programme. What we have found

§ The Executive Head of Service Management maintains a risk register for the overall CYPLS Group.

§ A ‘significant hazard and risk register’ is maintained for the Stanley Park High School OSP Project although this appears only to deal with risks associated with building construction.

§ A risk register for the BSF programme has been set up, which is reviewed at each meeting of the BSF Steering Group.



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§ Undertake an initial risk workshop to identify further risks to be added to the initial risk register.

§ Extend risk management beyond just the building elements of the project – for example considering the possibility of key personnel leaving, therefore needing to think about succession planning and the retention of skills and knowledge to ensure the progress of the Initial Project and overall BSF programme.

§ Ensure that ‘high level/serious impact’ risks are considered regularly by the BSF Project Board and that risk mitigation actions and contingency/business continuity planning are reviewed regularly.



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3. Requirements for Readiness to Deliver by March 2009 Based on the key findings from our review we believe there are a number of key tasks for the Council to undertake during the period January – March 2009 in readiness to move into ‘delivery mode’ (i.e. as soon as DCSF announces the revised allocation of local authorities in the BSF Programme). These tasks are set out in the Action Plan attached as Appendix A to this report.

The purpose of the Action Plan is to enable the Council to gear up to start acquiring and managing the resources needed as soon as approval is given to proceed with the Initial Project. The following section describes the requirements for the necessary longer term resourcing that will need to acquired and committed over the period of implementing the BSF Programme as a whole; these resources will not all need to be acquired before approval is secured. As mentioned in Section 1 of this report, our proposed Action Plan excludes the implications of PfS’ expected changes to the BSF Readiness to Deliver requirements regarding completion of Strategy for Change 1.

3.1 Establishing an Implementation Budget For a project estimated at £80 - £100 million in capital a project management or implementation budget of between 3 – 4% of this value would be required to cover the planning of the project up to financial close. Clearly this would represent a significant demand on the Council’s resources and will need careful consideration in terms of funding. The options for funding this level of cost, following a decision from DCSF to proceed, are likely to include: § Direct funding from the Council’s revenue budget for which other demands are likely

to compete. § Direct Funding from the Council’s Capital Budget for which other demands are likely

to compete.

§ ‘Top slicing’ the Council’s Dedicated Schools Grant (DSG) but this is likely to be

resisted by schools, especially those who are not affected directly by BSF.

§ Specific bid to DCSF for additional funding for BSF.

§ Use of the existing Schools Capital Programme to provide funding for BSF staffing, but if this is to be considered then a risk assessment would need to be applied on the extent to which existing schools capital needs would escalate without the level of capital planned for on the basis of AMP assessment.



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3.2 Recruiting a Programme Director Whilst there is no indication yet about the timescale for the Borough’s entire BSF Programme, best practice in project and programme management is to have a single person, a programme director, recruited internally or externally, with the necessary accountability and responsibility for delivery of the programme as a whole. The programme director would report to the project board, take ownership of the programme as a whole, lead on stakeholder engagement, provide strategic direction to the various officer teams within the programme and ensure the timely availability and deployment of resources. A programme director will be needed to drive BSF as soon as the DCSF announcement is made. The salary package, plus on-costs, of such an appointment, full time, is likely to be in region of £100,000 - £120,000 but this appointment would not need to be made until after the decision to proceed is announced.. We would recommend the recruitment process is started in order that the successful candidate is ready to take up post as soon as practicable after approval is given to proceed with the Initial Project.

3.3 Preparing to Mobilise the BSF Programme Team For the individual projects within the programme as a whole, and possibly for individual schools or groups of schools within each project, a dedicated project manager and project team will be needed. An overall BSF programme team for Sutton might be as follows:

§ Programme Director BSF

§ 2 or more project managers

§ 2 or more project officers to deal with distinct elements of phases of a project

§ External legal, technical, financial and design advisers

§ Commercial/Procurement Manager

§ In-house ‘workstream managers’ for areas such as education visioning, ICT, design/technical, finance and legal

§ Educational Transformation Manager (see below)

§ Schools’ representation

§ BSF Programme Administrative support

§ Communications Manager

Internal cost

The annual direct staffing costs for a project of £100 million in capital value, with a full-time team of this size plus related on-costs and including the procurement of a LEP, is



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likely to be in the region of £500,000 - £600,000. Based on a three-year project planning phase up to financial close this is therefore likely to involve an internal total implementation cost in the range of £1.5 - £1.8 million. We recognise, however, that not all of these roles may need to be full time and it may be possible to combine some of these with existing roles. Furthermore, as mentioned above, this level of resourcing would not need to be acquired until after the decision to proceed is announced. External cost In addition to direct staffing costs the Implementation Budget will also need to cover the costs of internal re-charging for specific in-house advisory support (e.g. legal support to the Project Team), external advisory support, accommodation, printing, IT requirements, travelling and other expenses. The annual cost of this support for a project of £100 million in capital value and including the procurement of a LEP is likely to be in the region of £650,000 - £750,000. Based on a three-year project planning phase up to financial close this is therefore likely to involve an external total implementation cost in the range of £1.95 - £2.25 million. Again, this level of resourcing would not need to be acquired until after the decision to proceed is announced. The overall timescale for which support will be required (for example say 4 – 5 years during which projects are approved ‘back to back’ without gaps), and the amount of funding needed each year will depend very much on the allocation of projects within the overall programme. We recognise that it is impossible at present for Sutton to determine the timescale for the remainder of its BSF programme even if the Initial project is approved for early implementation.

3.4 Developing Programme and Project Visioning and Transformation Management Concurrent with the recruitment of a Programme Director we believe it will be necessary also to develop a role within the programme that will further develop the LA’s overall educational vision, lead from the LA on the development of individual school visions and manage the interface with schools. This we believe will help ensure that the programme focuses on the achievement of educational outcomes. This senior role, which may not necessarily be full-time and could be combined with an existing role within the Council’s Advice and Inspection Service, would be expected to cover, for example:

§ Building effective working relationships, sound communication, engagement and consultation systems across the Directorate and with parents, governors and the wider community.

§ Integrating Inclusion and SEN within both the Initial Project and the overall BSF Programme.

§ Identifying and removing or reducing barriers (whether funding, organisational, reluctance to change) to the level of transformation expected of the overall BSF programme.



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§ Advising and assisting schools in defining, assessing and challenging their proposals to transform education through the programmes.

§ Supporting the Programme Team in define future site/building requirements to deliver the required scale of transformation.

§ Liaising with curriculum and other service specialists to ensure the design and use of the learning environment is properly aligned with the changing curriculum.

§ Ensuring the appropriate level of ‘buy in’ among the CYPLS Management Team to the proposed approach for ICT within the BSF Programme.

§ Supporting collaboration, partnering and networking between stakeholders to promote and sustain learning and best practice.

§ Linking with LA colleagues across the Directorate to help develop the ECM agenda and to help align the development of the Children’s Service Estate with service priorities and plans.

§ The annual full-time staffing cost of such a role plus on-costs (included in the above estimated cost of the team) is likely to be in the region of £90,000; again this support would not need to be acquired until after the decision to proceed is announced..

3.5 Preparing for Procurement Our advice in this section is offered on the basis of securing an appropriate procurement vehicle for Sutton’s BSF programme as a whole. The immediate task for officers will be to scope the entire programme, including the Initial Project to determine exactly what the ‘procurement vehicle’ will be required to deliver. We recognise that officers have started to carry out a preliminary assessment of what other services, in conjunction with BSF, could be delivered (for example to the Council corporately), the wider regeneration opportunities offered by the project, the services to schools and the potential for joint procurement with one or more other local authorities. However initial thoughts are that these may not be sufficient to justify using a LEP. It will be necessary, during this period, to firm up on the likely scope of procurement based on the above and to agree a range of criteria for basing a decision on a preferred model including:

§ The range of skills, knowledge and resources necessary and available to deliver the strategic objectives of the LA’s programme as a whole, not just a project within the programme.

§ The ability to properly integrate ICT within the built environment.

§ The ability to deliver flexibility through a mix of contracts and supply chain relationships.

§ The ability to respond flexibly to changing education strategies.

§ The ability to demonstrate Value for Money and continuous improvement.



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§ Others such as degree of control by the LA, assessment of risk and marketability.

Three procurement models are described in Section 4 below. Any procurement model for the delivery of a BSF programme must be capable of demonstrating and delivering an ability to match or exceed those outcomes expected from the ‘default’ LEP model. This would be done by mapping the scope and characteristics of the BSF programme as a whole against the defined criteria such as those mentioned above. The actual procurement process would only commence following the decision to proceed with the Initial Project.

3.6 Gearing up schools’ commitment Because of the far-reaching impact of BSF on helping increase educational achievement it is vital that appropriate school senior management time is devoted to BSF. Once the approval to the Initial Project is given it will be necessary for each school within the project to identify a senior member of staff to act as the BSF lead for that school and to lead the interface with the project team, governing body, students and other local stakeholders. Local management arrangements will need to be approved by schools’ governing bodies and put in place to ensure that there is suitable senior management input available for each school at the time needed without impacting on the day-to-day operational of the school. This could be by allowing the incumbent head/deputy head to focus on BSF the ‘backfilling’ his or her post or by bringing in (perhaps by secondment) someone to fulfil the role. We recognise that the existing Deputy Headteacher at Stanley Park High School will have acquired an enormous amount of knowledge and experience from his involvement in the One School Pathfinder project. We strongly recommend that this is taken into account in considering the available options for developing an appropriate model of school input to the programme as a whole ready to be funded as soon the Initial Project is approved to proceed.



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4. Conclusions from Review § We recognise the good progress that Sutton continues to make in managing its One

School Pathfinder Project and that this will have given officers and other stakeholders valuable experience in gearing up for the Initial Project.

§ We have highlighted the actions (for example around visioning, communications and

ICT) that will need to be taken, either directly by the Council or with consultancy support, to move the Initial Project to a state of readiness to deliver.

§ We believe it is essential to plan immediately for the Programme Team, headed by a Programme Director, ready for ‘mobilisation’ as soon as practicable following approval to proceed with the Initial Project.

§ A Project Initiation Document (PID) should be drafted utilising the lessons learnt and best practice from both Sutton’s OSP, guidance provided by PfS and 4ps and contained in this report. The PID should address such issues as a draft programme structure, communications plan, risk register etc. that can be developed further once funding approval has been received.

§ A rigorous assessment of the procurement options against the scope of the programme as a whole is required to ensure that the chosen procurement ‘vehicle’ provides both value for money and fitness for purpose.

§ There are risks associated a) with not proceeding with the actions recommended and being unable to deliver when approval to proceed is given and b) with incurring potentially abortive costs now with no guarantee of early approval.

Action Plan for BSF planning January – March 2009 We have set out as an Appendix to this report a summarised Action Plan for the tasks referred to in Section 3 above. This provides our preliminary view of the estimated time needed to undertake the task, the likely impact on Sutton internal resourcing and the external support available. We have also included our assessment of the likely risks that could impede the progress required and we would advise early consideration of the measures that would be necessary to reduce or remove the risks identified, and indeed others that would be identified in this period. We are aware of the limited resources that Sutton currently has available to allocate to BSF planning and have made every attempt to be realistic about what can be achieved in the period January – March 2009 with minimal additional funding. Much of the preparation for BSF implementation will be about building on officers’ existing knowledge and ‘upskilling’ which, when completed (for example in the areas of visioning and ICT



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development). This will put the authority in a good position for securing service improvement whether or not it is given early approval to proceed with the Initial Project.

5. Procurement Options

5.1 Local Education Partnership Local Education Partnerships (LEPs) were introduced through BSF as a means of harnessing the best of both the private and public sectors to deliver the degree of educational transformation expected of BSF as an education improvement programme. The LEP is a company that will provide long-term partnering services for a local authority and through which the LA delivers its BSF aims. It is a ‘joint venture company’ comprising the local authority, Partnerships for Schools and the local authority’s chosen private sector partner (PSP). The local authority has a contract (the ‘Strategic Partnering Agreement’) that gives exclusive rights to the LEP to deliver projects for a fixed period, normally 10 years. By having financial investment at risk in such a partnership, the local authority is sharing (proportionate to its shareholding) in the risks as well as the rewards that would otherwise be retained wholly by the private sector. This gives both the public and private sector partners an interest in seeing the LEP succeed which, for the public sector (i.e. local authority’s) shareholding, means returns that can be re-invested into local services. Overall, the benefits of the LEP are claimed to be better design quality, cost efficiencies, shorter timescales (in the context of the overall period of time for which the LEP is established). The LEP has the potential to procure services wider than those related just to BSF. These could include primary school capital investment, health care and wider regeneration schemes as well as corporate wide ICT services. The key difference between LEPs and other frameworks or other procurement mechanisms is that, once the LEP is procured, the LA then works in a one-on-one relationship to deliver future projects rather than competitive tendering for each scheme. The private sector provider in a LEP can bring delivery expertise, development capital, supply chain and partnering efficiencies. The local authority, through its understanding of, and responsibility for, the local community, can help ensure that local needs are met. The LEP can deliver both Design and Build projects or PFI projects and the ICT managed service across the school estate. Due to the size (generally over £100 million) and complexity of a LEP it is procured through the competitive dialogue OJEU process. This typically takes 18 months from commencing procurement. It should be noted that all projects are delivered through a Design & Build (D&B) or Private Finance Initiative (PFI) route; traditional forms of procurement are not utilised. Where projects are complete new build the default model is for them to be procured under PFI. The disadvantage of a LEP is that it is expensive and complex to procure; typically the cost and duration will be twice that of standard procurement routes. For LEPs to be economically viable a capital programme of approximately £150 million is required; this is



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firstly to attract the bidders as bidding costs are generally in the region of £2 million to £3 million and to get the economies of scale required to generate savings to offset the bid costs and running costs of the LEP. Key issues for Sutton in considering a LEP include: § Sutton’s proposed Initial Programme is approximately £80 million with no follow on

project guaranteed, which may not be attractive to potential bidders. Although Sutton’s initial identified projects are in areas of deprivation and have issues with attainment which may keep them higher up the LA priority list their remaining projects do not have the same profile and therefore these schemes could be lower down the priority list for the follow on projects. This may result in a significant gap between Sutton’s first and second projects which may cause LEP cashflow issues. Further discussions with PfS will be needed if Sutton is successful in coming forward into the programme next year.

§ As yet there are no other viable capital programmes identified that could also be

incorporated in a LEP to sustain it beyond the initial £80million programme.

§ Sutton already has a high performing in-house ICT managed service across its schools. The default model for a LEP is to provide an estate-wide ICT managed service. This would mean that either Sutton’s own ICT service would need to be transferred, under the Transfer of Undertakings (Protection of Employment) arrangements (TUPE), to the new Private Sector Partner in the LEP or the LEP would operate without ICT which PfS may not support.

§ LEP procurement takes considerable resources and cost and currently senior officers in Sutton have stated that the Authority might not be willing or able to fund such a procurement exercise.

§ LEP procurement will take approximately 9 months longer than using the PfS D&B Framework and therefore the first schemes of the initial wave are likely to open up to one later. However once a LEP is in place it will be easier and quicker to procure new projects as competitive tendering is not required.

§ If a LEP is not used and if Sutton receives funding for a follow-on programme then another procurement exercise will be required for the projects in that programme.

§ The possibility of joining up with one or more other local authorities to make a combined and bigger programme of projects more attractive to the establishment of a LEP.

§ Under LEP procurement complete new build projects are usually PFI. Sutton will need to consider the implications of entering into a long term arrangement such as



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PFI. Other authorities have not utilised PFI for their BSF programmes however when procuring LEPs this tends to make them less attractive to the market place.

5.2 PfS National Framework Partnerships for Schools has established a national framework of design and build contractors that are capable of delivering single or small grouped school projects with an overall capital cost of less than £140 million. This would be for grouped schools projects to be procured either all at once (‘bundled scheme’) or in more than one phase (‘batched schemes’). The National Framework currently has six Panel Members but this is likely to be increased to ten in 2009. The framework procures projects on the basis of a standard PfS Design & Build Contract. Two bidders are selected from the panel to bid for a single project or a number of projects. The bidders provide a Stage C design response with a fixed cost against the sample scheme that they are bidding against. A preferred bidder is then selected and develops the scheme to achieve planning permission and agrees the final price before the contract is awarded. The procurement process typically takes about 9 to 12 months to reach financial close. Any ICT managed Service requirements are procured separately, this can be via a normal OJEU process or utilising the BECTA ICT Framework. The concern with the PfS D&B Framework is that many LAs have been struggling to get more than one bidder therefore not giving the client the desired level of competition on both design and price. In addition as the route uses a very early D&B process sometimes the LA and schools can feel they do not have enough control over the design development process. Key issues for Sutton to consider in using the PfS D&B Framework: § Some users (mainly Academy Sponsors) of the framework have not liked the

procurement process because the somewhat detached control of design, however as Sutton are unlikely to have Academies this may be less of an issue.

§ Design development is almost entirely within the control of the contractor using a D&B

procurement method. Sutton will therefore need to have a very robust brief that has been signed up to by the schools and that will not change.

§ There have been problems in getting sufficient bidders with a number of single tender actions, however with the current market conditions and the fact the framework will be re-bid next expanding it to up to 10 framework contractors this issue should be less of a problem.

§ The procurement process is well defined and the standard contracts are well known by the bidders which should help with a more streamed lined procurement process.



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§ The framework has already been used for smaller BSF programmes successfully such as Middlesbrough’s programme which was £90 million of capital spend. EC Harris was brought into this project after procurement which was managed by the LA’s team. We understand that procurement cost in the region of £1.5 million for the first two of the LA’s projects plus a further £1 million for ongoing services. Therefore this procurement method would be more than adequate for Sutton’s initial BSF programme. However, these figures are based on EC Harris’ understanding of the procurement costs involved in the Middlesbrough project and should not used for direct comparison with Sutton’s BSF proposals.

§ By using the PfS D&B framework there would be no need to go out to OJEU, although

this wouldn’t necessarily save any time on the programme.

§ The PfS D&B Framework does not allow for PFI procurement models.

§ The procurement costs would be substantially less then a LEP procurement exercise, although if Sutton has a follow-on BSF programme in the near future it would be required to go through a separate procurement exercise.

§ A separate procurement exercise would be needed for ICT, whereas a LEP would procure the contractor and ICT provider as one package. However of Sutton remain in control of the ICT managed service this would be less of an issue.

5.3 Improvement and Efficiency South East (IESE) Improvement and Efficiency South East (IESE) (formerly known as ‘SECE’) is a contractor framework which has already been used to deliver Sutton’s One School Pathfinder. The IESE framework typically uses a 2 Stage D&B or 2 Stage Traditional procurement route. The Client takes the design to Outline Proposals (RIBA stage C) and then the design team is ‘novated’ to a Contractor from the IESE Framework (chosen through mini competition) to develop the design from RIBA C to Detailed Design Proposals (RIBA Stage D) through to Production Information (RIBA Stage F). The design is then broken down into different work packages and these are tendered by the Main Contractor (RIBA Stage G and H) in an open book fashion with the Client QS so that at the end of this process when all of the package values have been agreed a final Design and Build Contract Sum is agreed with the Main Contractor which includes: § Contractors Preliminaries § Contractors Design Fees § Work Package Costs



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§ Agreed Risk Contingencies Once the Design and Contract Sum is agreed the Main Contractor will then mobilise and construct the new facility to an agreed programme and design. Sutton could consider this model of procurement however currently the default models for delivery of BSF projects are the D&B Framework or the LEP and PfS are reluctant to allow LA’s to deliver using other procurement routes. We understand that the Chief Executive of Hampshire County Council has written to Sutton’s Chief Executive inviting Sutton to consider joining with Hampshire on developing a regional delivery model for BSF which would provide a complementary option to the formation of an authority specific LEP. With the increasing pressure for PfS to meet its targets for the delivery of BSF programmes there may be some relaxation of this next year. We would recommend that Sutton maintain a ‘watching brief’ on this as yet untested option but proceed on the basis of using either the D&B Framework or LEP model until they are able to undertake discussions with PfS on the ability to use a different model. Key issues to be considered in using the IESE Framework: § Sutton are familiar with it by procuring their One School Pathfinder project.

§ The Framework is not designed for a multiple project programme and careful thought

would be needed on the way projects would be procured using the framework. Would they be individually procured or jointly procured? If the projects were jointly procured there may be issues in the ability to realise economies of scale that could be achieved by using a LEP or PfS D&B Framework procurement route.

§ IESE prefer the 2 Stage procurement method which with a programme of the scale of Sutton’s potential Initial BSF Programme may pose significant financial and programme risks as the selected contractor does not bidding in a competitive price situation where the PfS LEP and Framework models do for the first projects to be delivered.

§ In the current market single stage D&B procurement is likely to be much more competitive then a 2 stage route.

§ By using the IESE framework there would be no need to go out to OJEU, although this wouldn’t necessarily save any time on the programme.

§ The IESE framework contracts would not give the same level of risk transfer protection as the PfS contracts which could expose Sutton to a greater level of financial risk than the other procurement methods.

§ The IESE contracts are not set up for integration of ICT as the PfS contracts are.


Appendix A

echarris.com EC Harris LLP is a limited liability partnership registered in England (registered number OC304988). A list of members’ names and their professional qualifications may be inspected at our registered office, ECHQ, 34 York Way, London N1 9AB United Kingdom. OWNED AND OPERATED AS ONE BUSINESS THROUGHOUT EMEA, ASIA PACIFIC AND NORTH AMERICA

Appendix A – Action Plan for Readiness to Deliver by March 2009 Action Estimated

Timescale Implications for Sutton internal resourcing*

External support available Risk

1. Establish a BSF Implementation Budget

2 days Corporate and CYPLS Finance officers. Lead CYPLS and other Members to be briefed on resourcing implications. Say 2 officers @ £350-£450 each per day = £1400-£1800

Advice on how to ‘sell’ the required package for approval by Members. Say 1.5-2 consultant days @ £900 per day = £1350-£1800

Lack of progress in securing the level of funding to progress the Initial Project following approval to proceed

2. Recruit a BSF Programme Manager

2 days CYPLS to scope role and, with Corporate HR input, compile job description/person specification and plan recruitment process. Say 2 officers @ £350-£450 each per day = £1400-£1800

Advice based on experience of other similar LAs Say 1-2 consultant days @ £900 per day = £900-£1800

Lack of suitable response to recruitment process

3. Prepare to mobilise the BSF Programme Team

3 days CYPLS to start compiling and maintaining the PID. CYPLS to scope project governance framework including the roles of the Project Board and Team.

Advice on tailoring the suggested programme team model, including the use of internal and external specialist resources to fit Sutton’s specific needs. Advice on suitable framework for

Lack of time commitment, for example because of other pressing priorities. Lack of sense of urgency because of uncertainty of timing of remainder of the BSF Programme even though the

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CYPLS to assess how much of the Project Team can be assembled using existing roles within CYPLS and the Council as a whole. Keep stakeholders up to date with the progress of the Initial Project. Say 2 officers @ £350-£450 each per day = £2100-£2700

stakeholder management and engagement based on BSF work with other LAs. Facilitating Risk Management Workshop to raise awareness at all levels within the Borough. Say 1.5-2 consultant days @ £900 per day = £1350-£1800

Initial Project may be approved in 2009 for an early start.

4. Programme and Project Visioning and Transformation Management

3 days Head of School Improvement, Lead Inspector and OSP School rep to coordinate. Workshops for BSF Programme Team and for individual schools. Say 2 officers @ £350-£450 each per day = £2100-£2700

Facilitating workshops, critical assessment of documentation and review against BSF expected outcomes. Say 1.5-2 consultant days @ £900 per day = £1350-£1800

Lack of coordination/clarity of or agreement on the overall Borough vision. Lack of progress with individual school visions and their integration with overall Borough vision.

5. Preparing for Procurement

3 days CYPLS, Corporate Finance, Legal and Procurement officers to become more familiar with the range of procurement options. Workshop to finalise scope of

Advice on procurement based on experience of BSF programmes.

Lack of progress in agreeing the scope of the BSF programme. Lack of approval from PfS to consider procurement options other than the ‘default’ models.

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the Programme to help determine most appropriate procurement route. Explore with other LAs the potential to work jointly to secure LEP ‘critical mass’. Say 2 officers @ £350-£450 each per day = £2100-£2700

Say 1.5-2 consultant days @ £900 per day = £1350-£1800

6. Gearing up schools’ commitment

2 days OSP Project Deputy Head to advise schools in Initial Project the school resourcing needed. Say 1 officer @£350-£450 each per day = £700-£900

Advice to school senior management teams and governing bodies based on experience of BSF early programme planning. Say 1-2 consultant days @ £900 per day = £900-£1800

Agreement in principle from schools but lack of commitment to identify suitable resourcing early enough e.g. because of need to focus on shorter term school priorities.

7. Developing ICT As per ECH proposal 11 November 2008

Schools ICT Development Manager to liaise with Consultants Team. Say 1 officer @£350-£450 each per day = £350-£450

Consultancy work as set out in EC Harris’ proposal of 11 November 2008 to Sutton’s Schools ICT Development Manager and priced at £5,850 plus VAT.

Total estimated cost £10,150-£13,050 £13,050-£16,650 plus VAT

*The daily rates for officers are for illustrative purposes only; they are not based on actual rates.

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Contacts


EC Harris LLP ECHQ, 34 York Way London N1 9AB United Kingdom dd 020 7812 2671 df 020 7812 2005 e [email protected]


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