To consider any items of business that by reason of special circumstances the chairperson is of the opinion should be considered at the meeting as a matter of urgency in accordance with paragraph 2.4 (e) of the Cabinet Procedure Rules within the Constitution.

School Modernisation – Pencoed Primary

To request Cabinet delegate authority to the Corporate Director – Education and Family Support to conduct negotiations with the lowest priced tenderer, in accordance with procurement legislation;

Subject to the successful outcome of any such negotiations, to delegate authority to the Corporate Director – Education and Family Support to award a contract, the terms to be finalised in consultation with the s151 Officer, and to arrange execution of the same on behalf of the Council

The Chairperson accepted the above item as urgent under Rule 2.4.(e) of the Cabinet Procedure Rules within the Council’s Constitution, on the basis that the business in question needs to be considered at the meeting in order to meet the funding profile agreed by Welsh Government. In addition, the school is scheduled to be opened on 1 April 2018. If Cabinet did not consider the report until its next scheduled meeting, it would become impossible for the scheme to be completed by April 2018.

The Head of Education and Family Support presented a report, that requested that Cabinet agrees to delegate authority to the Corporate Director Education and Family Support, to conduct negotiations with the lowest price tenderer in accordance with procurement legislation, and subject to the successful outcome of any such negotiations, delegates authority to the above Officer to award a contract, with the terms to be finalised in consultation with the S151 Officer, and to arrange execution of the same on behalf of the Council.

The report outlined certain background information, following which it confirmed that on 4 October 2016, Cabinet authorised the invitation of tenders for the construction of the new Pencoed Primary School, with delegated authority being given, to award the contract to the bidder who submitted the most economically advantageous tender for the construction of the new school, subject to the tender price being acceptable to the S151 Officer and receipt of Welsh Government funding approval and certain other requirements

The Head of Education and Family Support that the tender process had been undertaken, and that only 2 of the 5 tenderers had been in compliant with the scheme, with both of these tender quotes significantly in excess of the construction budget available for the scheme.

In view of this, the way forward now was to, as a matter of urgency, commence negotiation of a ‘Value Engineering’ schedule with the contractor who submitted the lowest tender, in order to bring the construction cost sum within available budget, due to there being a clause in the tender which allows for the authority to negotiate with the lowest tenderer. The Head of Education and Family Support added however, that this negotiation process would undoubtedly prolong to a degree the awarding of the contract and potentially delay the school opening date. It may also impact on achieving next year’s Welsh Government (WG) spend on the project she added.

Paragraph 7 of the report reinforced this, by adding that the timetable was restrictive as the construction contract was part funded by WG, so there was a risk that if the spend profile was not met then the Council may lose the approved Welsh Government grant funding.

The Head of Education and Family Support concluded her submission by outlining the report’s financial implications as shown in paragraph 7.1 (of the report).

The Leader advised that undertaking negotiation of a ‘Value Engineering’ schedule with the contractor would not impact in any way on the quality of work needed in the construction of the facility. When the construction cost sum is eventually received, then this would be assessed by the Council’s Quantity Surveyors in order to establish if any savings could be achieved through design changes that would not have any impact on future teaching and learning.

The Deputy Leader advised that he was frustrated that the tender did not come in on budget, however, as the Leader had just stated, Council Officers would ensure that the project remains “Value for Money”.

The Head of Education and Family Support also reinforced that prices/estimates in respect of the school had originally been set in 2010, and since then costs for materials had increased.

The Cabinet Member for Social Services and Early Help closed debate on this item by further adding that work for Engineering companies had also picked up within the last few years.

RESOLVED:                 That Cabinet:

1.    Delegated authority to the Corporate Director, Education and Family Support to conduct negotiations, with the lowest priced tenderer, in accordance with procurement legislation.

2.    Subject to the contract being awarded in accordance with paragraph 8.1.1 of the report, and to the revised price being acceptable to the S151 Officer (which is a requirement of Cabinet in its resolution of the 4th October 2016), delegated authority to the Corporate Director, Education and Family Support to enter into a construction contract and any relevant ancillary agreements thereto, in consultation with the Director of Operational and Partnership Services and arrange for execution of the same on behalf of the Council.

                      3.   Noted that Cabinet will in due course receive an information report detailing the outcome of the negotiation and award process.