Lisburn Primary and Community Care Project

Transcription

1 Lisburn Primary and Community Care Project Appointment Business Case DRAFT v0.2 Section 1 Executive Summary 0

2 Contents 1 Executive Summary... 1 Introduction... 1 Project Background... 1 Section 2: Update of the Outline Business Case... 3 Section 3: Authority Requirements... 4 Section 4: Overview of Procurement Process... 5 Section 5: Final Tender Evaluation... 6 Section 6: Value for Money... 7 Section 7: Affordability and Accounting Treatment... 8 Section 8: Contractual Structure Section 9: Risk Allocation Section 10: Post Project Evaluation and Benefits Realisation Section 11: Process from Preferred Bidder to Contract Award Section 12: Conclusions and Recommendations Version Control Version : Description: Owner: Issued: 0.1 Initial Draft incorporating Introduction and Background for CB n/a KPMG to complete 0.2 KPMG Update KPMG 20/05/15 DRAFT

3 1 Executive Summary Introduction 1.1 This Appointment Business Case ( ABC ) has been prepared by the South Eastern Health and Social Care Trust ( SEHSCT or the Authority ) with the assistance of its specialist advisors. It sets out the case for the appointment of a Preferred Bidder for the Lisburn Primary and Community Care Centre ( PCCC ) Project ( the Project ) and the further progression of the Project to the Full Business Case ( FBC ) stage. 1.2 The ABC begins by providing information on the background to the Project along with a summary of, and update to, the original OBC for the Project. It then sets out the detailed Authority construction and service requirements to be met by the private sector developer, presents a summary of the allocation of the key risks underlying the Project, provides a comprehensive report on the procurement process and sets out an overview of the detailed evaluation of the Final Tenders received from the shortlisted private sector bidders. 1.3 The ABC concludes by analysing the value for money and affordability of the recommended Preferred Bidder s Final Tender stage bid submission, summarising the contractual arrangements underpinning the contract to be entered into between the Authority and the recommended Preferred Bidder, and summarises the next steps for the Project in progressing from ABC approval to development and approval of the FBC and thereafter to contract award. It also covers details on the arrangements for post project evaluation and benefits realisation, including how the contract will be monitored and managed post contract award. 1.4 This ABC has been prepared in accordance with the requirements issued by the Department of Health, Social Services and Public Safety ( DHSSPS ) 1, which follow the Northern Ireland Guide to Expenditure Appraisal & Evaluation ( NIGEAE ) and Value for Money ( VFM ) Assessment of Alternative Procurement Options (28 October 2014), guidance issued by the Department of Finance and Personnel ( DFP ). Project Background 1.5 The Project involves the provision of a new circa 10,800 2 sqm PCCC facility in Lisburn which will provide fit for purpose accommodation for GP services, selected acute outpatient services and a large number of multidisciplinary teams, many of which will be relocated from the existing Lisburn Health Centre, Warren Children s Centre and other leased premises, namely TSL House and Bridge Street. 1 As set out in the letter from Bill Pauley (DHSSPS Investment Director) to Martin Kelly (Primary Care Infrastructure Programme Director, Health and Social Care Board) on 14 th August Gross Internal Floor Area excluding communications space allowance DRAFT 1

4 1.6 The main thrust behind the development of the new PCCC is to enable greater management of chronic conditions in the community and closer to patients homes through the co-location and integration of GP practices with multi-disciplinary SEHSCT teams in a functionally suitable building. The Project involves the application of a new model of care utilising a hub and spoke approach, whereby the GP and SEHSCT teams located in the new PCCC facility are considered to be the hub and other individual GP practices in independent premises or smaller SEHSCT health centres within the local area are considered as spokes. 1.7 This hub and spoke model is core to enabling the development and implementation of the new model of service necessary to deliver on the many opportunities for improvement which have been identified under the Transforming Your Care ( TYC ) health service delivery reform agenda. 1.8 On 6 April 2012, the DHSSPS Permanent Secretary wrote to the SEHSCT advising that the Health Infrastructure Board ( HIB ) recommended fast tracking two large primary and community care infrastructure projects, one within the South Eastern Health and Social Care Trust area at Lisburn and one within the Southern Health and Social Care Trust area at Newry. The letter specifically requested the SEHSCT to complete the development of a Strategic Outline Case ( SOC ) and Outline Business Case ( OBC ) for the Lisburn Project, and also specifically highlighted the DHSSPS Minister s desire to seek alternative funding sources, where appropriate, to support the development of health infrastructure. 1.9 The SOC for the development of a PCCC in the Lisburn area was approved by the South Eastern Local Commissioning Group ( LCG ), DHSSPS and DFP within an approval letter dated 1 st August Subsequently the OBC for the Project was prepared by the SEHSCT in conjunction with the Strategic Investment Board ( SIB ) and the SIB s appointed specialist advisers. In accordance with the instruction from the DHSSPS Permanent Secretary this OBC tested alternative procurement routes, including the privately financed Third Party Development ( 3PD ) approach, for the delivery of the Project While the OBC concluded that procurement of a new PCCC facility on the Trust owned Lagan Valley Hospital site using conventional procurement was the lowest cost option in purely quantitative net present cost terms, it was highlighted in the commercial appraisal that that the feasibility of this preferred economic option was reliant on the availability of capital DEL budget in the required timeframes Due to the lack of Capital DEL budget available in the required timescales, the OBC financial analysis went on to suggest that the procurement of a new facility using 3PD had the potential to allow the development of the Lisburn PCCC to be progressed in the required timescales without the requirement for upfront capital DEL budget cover Furthermore, the OBC analysis highlighted that procurement under a 3PD solution provides the opportunity to test whether greater VFM can be achieved through seeking an alternative site for the PCCC through the procurement process. As such, the OBC concluded that while the site at the Lagan Valley Hospital should be retained as an option for prospective 3PD bidders, it would be important that tender documentation also affords bidders the opportunity to propose alternative sites so that any potential to improve VFM can be presented and evaluated by the SEHSCT, DHSSPS and DFP. DRAFT 2

5 1.14 The final version of the OBC was formally submitted to DHSSPS for review and approval following the completion of relevant Board approvals by the SEHSCT and the Health and Social Care Board ( HSCB ) in March While the OBC was not formally approved by the DHSSPS and DFP, the approval to commence a procurement process for the Lisburn Project as a Pathfinder scheme using a 3PD approach, was instead initiated through the issue of a Ministerial Direction from the then DHSSPS Minister (Edwin Poots) to the DHSSPS Permanent Secretary in April The procurement process for the Project was subsequently launched to the market in July 2013 using the EU Competitive Dialogue procurement procedure The 3PD approach involves a revenue funded partnership arrangement with a private sector developer as an alternative to funding from the traditional capital budget allocation. This will result in the SEHSCT entering into a contract for the design, build, finance and maintenance (hard facilities maintenance only) of the new PCCC facility for a lease term of 25 years. Alongside this, the SEHSCT shall enter into sub-lease arrangements with each of the GP practices that have agreed to re-locate to the new PCCC facility. The SEHSCT will then have an option to purchase the PCCC facility at the end of the 25 year term at a pre-agreed purchase price The innovative 3PD approach provided the private sector developers involved in the procurement process the opportunity to either utilise the SEHSCT Lagan Valley Hospital site or to propose their own site for the PCCC development within a certain Authority defined boundary of Lisburn town centre. It also envisaged that third party income ( TPI ) proposals, e.g. health care related or other complimentary retail services, might be incorporated into the proposed solutions brought forward by private sector developers through the procurement process, to improve the patient experience and/or to reduce the overall annual cost of the lease arrangement to the public purse This ABC provides full details of the various stages and outcomes of the 3PD pathfinder procurement process, and the remainder of this section provides a summary of each of the key sections of the ABC. Section 2: Update of the Outline Business Case 1.18 Section 2: Update of the Outline Business Case presents a summary of, and update to, the original OBC, to highlight the progress and changes made since the issue of the Ministerial Direction for the Project in April This section confirms that the strategic context and key objectives for the Project remain unchanged, subject to some minor updates to reflect additional supporting strategy published since the time of the preparation of the OBC along with some minor adjustments to the objectives to reflect the passage of time and minor changes in the overall scope of the Project Population and demographic factors will continue to place considerable pressure on SEHSCT and GP services in the Lisburn area going forward and the resultant need to rationalise the number of service locations and move out of the existing overcrowded accommodation, which is no longer functionally suitable. This section confirms the future service profile and staffing levels in the context of the proposed new integrated model of care for primary and community care centres (namely the hub and spoke model) and summarises a number of discrete DRAFT 3

6 changes to the OBC schedule of accommodation arising from the on-going stakeholder engagement process during the procurement process As a result of on-going GP engagement and correspondence, all GP Practices have now confirmed their intention to co-locate with the SEHSCT at the new PCCC facility. Given the positive confirmation received from the GP Practices, the ABC has been drafted on the assumption that all practices will be re-locating to the new CTCC building At OBC Stage, Option 4b: Lagan Valley Site - New Build on site occupied by Department of Psychiatry, IT Portacabins and Lagan View Conference Centre, was identified as the preferred option in economic terms. This ABC provides a comprehensive update of this preferred economic option and its associated costs to reflect both scope and time changes that have occurred since the OBC which impact on the Project. The quantitative analysis underpinning this ABC, estimate the Net Present Cost ( NPC ) of the Preferred Economic Option (at 01 April 2016 base date) to be 318m. Section 3: Authority Requirements 1.23 This section of the ABC sets out an overview of the Authority Requirements which were issued to Bidders, as part of the Invitation to Submit Final Tenders ( ISFT ) documentation. The Authority Requirements were to be addressed by Bidders as part of their final tender solutions A summary of the Authority s requirements, as detailed in this ABC, is set out below: Volume 1 - General Design and Organisational Principles: This is a design and technical document that set out the overarching design and organisational principles to be addressed by Bidders as they developed their design proposals for the new PCCC building; Volume 2, 3 & 4 Exemplar Information: These are a series of design and technical documents that provide the detailed room data sheets for the various clinical rooms, clinical support rooms and staff and social spaces listed within the Authority s schedule of accommodation (refer Volume 8). This includes details of requirements in regards to space, ceiling heights, air ventilation, lighting, noise, safety, finishes and typical fixtures, furniture and equipment requirements; Volume 5 - General Design and Construction Principles: This is a design and technical document that sets out the construction requirements for the facility; Volume 6 Design Standards: This is a design and technical document that sets out the expected design standards for the facility, and includes exemplar design information on the likes of finishes, fittings and furniture, way-finding, lighting, landscaping, security and artwork. It also includes exemplar room layout information and National Building Specification performance standards; Volume 7 Trust Design Brief: This sets out the SEHSCT s operational objectives and service requirements of the CTCC building and is to be read in conjunction with the other design and technical ITPD documents; Volume 8 Schedule of Accommodation: This sets out the required schedule of accommodation to be provided within the Bidders design on a room by room basis; and DRAFT 4

7 Volume 10 - Lease Schedule 6 (Services): This sets out the hard FM services requirements to be provided by Bidders within their proposed services solution for the operating phase of the Lease. Section 4: Overview of Procurement Process 1.25 This section of the ABC sets out details of the project organisation and governance arrangements that have been in place throughout the procurement process. It provides a summary of the key stages and timelines of the procurement process, including the management of the dialogue process with Bidders and how tenders have been evaluated at each of the key submission points throughout the process This section also includes an overview of the overall governance structure for the Project and extensive stakeholder engagement work undertaken throughout the procurement process and summarises the approach adopted to ensure that the Authority fulfils its statutory obligations in regards to Section 75 ( Equality ) The Lisburn PCCC Project was officially launched to the market in July 2013 and the procurement process undertaken to date, has comprised three distinct stages, as follows: Stage 1: Expressions of Interest and Pre-Qualification ( PQQ ) Stage - July 2013 to October 2013; Stage 2: Competitive Dialogue Stage - November 2013 to February 2015; and Stage 3: Final Tender Stage - February 2015 to June A total of 10 interested bidders responded to the Pre-qualification Questionnaire Package, with five bidders being shortlisted and invited to proceed to the next stage of the procurement process, i.e. the Competitive Dialogue Stage The Competitive Dialogue Stage was carried out over three distinct phases, Stage 2B, 2C and 2D which are summarised below: Stage 2B - The Invitation to Participate in Dialogue ( ITPD ) which incorporated the Invitation to Submit Outline Solutions (ISOS) was issued to the five shortlisted Bidders. Following initial dialogue with each of the five Bidders, the phase concluded with the submission and evaluation of the Stage 2B (ISOS) submissions and the shortlisting of the five Bidders down to three for the next stages of the procurement process; Stage 2C This stage commenced with an Invitation to Continue Dialogue ( ITCD ) being issued to the three Bidders remaining in the process following Stage 2B shortlisting. Following a series of dialogue meetings, each of the three Bidders were required to submit Stage 2C Interim Detailed Solution (ISDS) Submissions. These submissions were not formally evaluated by the Authority, but instead were used as a mechanism to provide structured feedback to each of the Bidders on their developing design and technical and financial solutions; and Stage 2D This stage commenced following the issue of feedback on the Stage 2C Interim ISDS Submissions. It involved a further series of dialogue with the three Bidders culminating in the submission of Stage 2D Detailed Solution submissions which were formally evaluated DRAFT 5

8 by the Authority and its advisors. While no further shortlisting was undertaken as part of the Stage 2D evaluation, detailed feedback was provided to each of the Bidders on all aspects of their Stage 2D submission. Following further dialogue with each of the Bidders this stage was completed with the formal close of dialogue, and all three bidders were invited on 27 February 2015 to submit Final Tenders by 23 March All three Bidders duly submitted Final Tender submissions by the required tender submission deadline. Section 5: Final Tender Evaluation 1.31 Section 5: Final Tender Evaluation provides an overview of the Final Tender Evaluation process undertaken by the SEHSCT in conjunction with the specialist advisers. This section provides an outline of the evaluation process, the award criteria applied, a summary of the work of the various evaluation panels and the overall results of the Final Tender evaluation Final Tender submissions were evaluated in accordance with the award criteria for Final Tenders, as set out in Volume 14 of the Invitation to Submit Final Tenders ( ISFT ) documentation, and which are summarised below: Award Criteria Weighting (%) Design and Technical 20 Financial 75 Legal 05 Total The overall final tender evaluation process for Design and Technical, Financial and Legal teams comprised four main stages to include initial review, issue of clarifications, assessment of relevant components and evaluation sign off An overview of these stages is set out below: Stage 1: Initial Review - CPD Health Projects ( CPD HP ) (formerly DHSSPS Health Estates) undertook an initial review of the Final Tender submissions for completeness and compliance. All of the Final Tender submissions passed the initial review check and were duly subjected to detailed evaluation; Stage 2: Clarifications - Throughout the Final Tender evaluation process the Authority reserved the right to ask Bidders to clarify aspects of their Final Tenders, as considered necessary. Where deemed required by the evaluation panels, written clarifications were issued to Bidders on particular aspects of their Final Tender submissions. The responses received from the clarifications were then considered as part of the Final Tender evaluation process; Stage 3: Assessment - The evaluation panels (namely design & technical, legal, and financial) assessed the relevant components of the Final Tender submissions (along with the responses to any clarifications issued thereon), in accordance with the award criteria DRAFT 6

9 for Final Tenders. Each panel then documented the outcomes of their evaluation work in an appropriate report format for submission to the evaluation co-ordinator at CPD HP; and Stage 4: Evaluation Sign Off - The outcomes of the work of each of the evaluation panels was consolidated into a summary document by the CPD HP evaluation co-ordinator, which set out the outcomes of the overall Final Tender evaluation process for ratification by the Sign Off Group. The Sign Off Group then met with the chairs of each of the evaluation panels to confirm that the evaluation had been appropriately conducted in line with the award criteria for Final Tender and to agree the recommended Preferred Bidder A recommended Preferred Bidder was agreed at the Sign Off Group meeting held on 7th May Sections 6 and 7 of the ABC were then completed on the basis of the outcome from the Sign off Group meeting. Section 6: Value for Money 1.36 This section of the ABC sets out details of the overall Value for Money ( VFM ) assessment for the Project. The VFM assessment comprises both quantitative assessment and an assessment of the qualitative impact of a Conventional Procurement Option ( CPO ), compared to the 3PD solution proposed by the recommended Preferred Bidder The detailed quantitative VFM assessment is based on financial appraisal and not economic appraisal and focusses on a comparison of the Net Present Cost ( NPC ) of the direct financial costs to Northern Ireland of conventional procurement, compared to the NPC of the 3PD solution presented by the recommended Preferred Bidder The CPO financial model presented at OBC stage, has been updated to reflect the refinements made to the Authority Requirements (including Schedule of Accommodation) during the procurement process and the current forecast timetable for the Project. An overview of the key changes to the bases and assumptions underpinning the OBC stage CPO financial model (provided by CPD Health Projects, SEHSCT and specialist technical advisers) to derive the CPO financial model used to inform the ABC stage quantitative VFM assessment, is set out in the ABC The results of the quantitative VFM assessment, presented in the table below, clearly show that 3PD is the best VFM procurement route for the delivery of the Lisburn CTCC Project. Table 1.1: Quantitative VFM Assessment (Comparison of recommended Preferred Bidder s NPC to NPC of CPO at ABC Stage) NPC ( 000) 1 April 2016 CPO NPC 42,627 Recommended Preferred Bidder s NPC of Annual Service Payments and Purchase 34,558 Price on Draft Lease Expiry Total (Cost)/Saving from an NI perspective ( 000) 8,069 Total (Cost)/Saving from an NI perspective (%) 18.9% DRAFT 7

10 1.40 The key reasons for the turnaround in the quantitative VFM assessment since OBC stage, include: improved liquidity in the financial markets and a fall in the all-in cost of debt finance; 3PD solution market test outturn capital costs, lifecycle costs and maintenance costs; and appetite of 3PD contractors to guarantee third party income. Section 7: Affordability and Accounting Treatment 1.41 Section 7 of the ABC sets out the expected accounting and budgetary treatments of the proposed 3PD solution DHSSPS have considered the likely accounting treatment for the Lisburn PCCC Project and provided a preliminary view, indicating that SEHSCT will record the infrastructure assets constructed as part of the Project on its balance sheet For national accounting and departmental budgeting purposes, the treatment of the Project is governed by European System of National and Regional Accounts ( ESA 10 ) and the Manual on Government Deficit and Debt ( MGDD ) Based on the results of the Financial and Legal Evaluation of Final Tender submissions, it is anticipated that the proposed 3PD Draft contract will remain off balance sheet for budgetary purposes. An off balance sheet outcome means that the stream of Annual Payments sought by the Preferred Bidder over the 25 year term of the contract, can be serviced from Resource budgets and therefore, the 3PD solution will not be reliant on upfront Capital budget cover The national accounting and budgetary treatment of the proposed 3PD contract will continue to be monitored as the contractual documentation is refined following Preferred Bidder appointment and the Project progresses towards financial close, currently estimated to occur in April The forecast budgetary requirement to deliver the Project comprises Capital budget to fund the elements of the Project being conventionally procured and Resource DEL to fund the elements currently included within the scope of the proposed 3PD contract Capital budget cover of c. 6.7m (in nominal terms) is required from DHSSPS over the first three years (2016/17 to 2018/19) of the Project to fund the following: Enabling Works in respect of the Lagan valley Hospital site (with the exception of site clearance works - where these costs exceed the uplift in the underlying value of the land, they will need to be partly funded by Resource budget); Supply of ICT equipment; and Supply of Group 2 and 3 Equipment. Thereafter, capital budget cover would be required for equipment replacement (Groups 2, 3 and ICT) costs in line with normal refresh programmes during the 25 year Lease term. DRAFT 8

11 1.48 Table 1.2 highlights that annual resource budget cover of c. 3.3m (in nominal terms) would be required over the first four years of the 3PD Lease. This rises to c. 4.7m in the fifth year of the Lease, predominantly due to increased staff and goods and services costs arising due to the forecast change in demographics. The annual resource budget cover is estimated to peak at 6.6m in the final year of the 25 year Lease term, should the SEHSCT exercise its option to purchase the CTCC premises upon Lease expiry. The cost of the CTCC premises as per the recommended Preferred Bidder s solution has been estimated as 3m. Table 1.2 Forecast Budgetary Impact of the recommended Preferred Option DEL Statement Year /2017 Year /2018 Year /2019 Year /2020 Year /2021 Year /2022 Year /2023 Year /2024 Year /2025 Year / year Total '000 '000 '000 '000 '000 '000 '000 '000 '000 '000 '000 Total DEL Required Total Capital DEL Required 3,449 3, (850) , ,046 9,231 Total Resource DEL Required 14,535 14,421 18,238 18,504 18,917 19,339 21,107 21,584 22,073 22, ,291 Existing DEL Provision Existing Capital DEL Provision Existing Resource DEL Provision 14,107 14,460 14,822 15,192 15,572 15,961 16,360 16,769 17,188 17, ,050 Additional DEL Required Additional Capital DEL required 3,449 3, (850) , ,046 9,231 Additional Resource DEL required 427 (39) 3,416 3,312 3,345 3,378 4,746 4,815 4,884 4,956 33, The additional resource budget cover required by SEHSCT over the 25 year lease term will be partially offset by income received from the GP s in respect of their contribution to the stream of annual service payments sought by the 3PD contractor and the utilities costs and rates payable in respect of the Lisburn PCCC facility The estimated contribution of the GPs towards the stream of annual service payments sought by the 3PD contractor and towards the utilities rates payable in respect of the Lisburn PCCC facility, is currently based on a preliminary PCCC shared space allocation that will be subject to further review and refinement at FBC stage to reflect the final agreed design and associated floor plans relating to the Preferred Bidder s 3PD solution The HSCB funding arrangement agreed with GPs for the Project when coupled with the preliminary shared space allocation, indicates that additional resource budget cover of c. 0.4m per annum will be required in respect of the GP s contribution, from the date the Lease commences (2018/2019). This is in addition to the c. 0.3m of GP reimbursements currently covered by HSCB in respect of GP accommodation within the existing Lisburn Health Centre. DRAFT 9

12 Section 8: Contractual Structure 1.52 This section of the ABC sets out a summary of the main contractual and legal arrangements that are expected to be put in place between the 3PD Contractor and the SEHSCT (the Authority ) for the Lisburn PCCC Project Furthermore, the section also notes that based on a review of financial information presented in the Final Tender stage bid submitted by the recommended Preferred Bidder, their proposed 3PD solution is considered to be bankable. In particular, the recommended Preferred Bidder s proposed solution is deemed to sufficiently developed and robust and there is sufficient support and commitment from debt providers and investors at Final Tender stage, to satisfy the Authority that there is no material risk on financial grounds of a failure to enter into the Agreement for Lease and Lease. Section 9: Risk Allocation 1.54 This section of the ABC provides a summary of the principal risks associated with the Lisburn PCCC Project, to include a discussion on the overall approach to risk transfer and a summary of the proposed risk allocation between the SEHSCT and the 3PD Contractor underpinning the contractual documents in the form of a series of risk matrices The main category of risk retained by the SEHSCT include financial risks and in particular, the ability of the SEHSCT to meet the funding obligations associated with the service payments, purchase price on early termination or other Project related costs, for example, utilities, rates and insurance costs The key categories of risks retained by the 3PD Contractor include design, construction and development and operational risks. Design Risks the ability of the 3PD Contractor to control the design process post after preferred bidder appointment and to deliver a design solution that fully meets the SEHSCT s requirements; and Construction and Development the ability of the 3PD Contractor to control the construction and development programme for the new Lisburn CTCC facility Operating Risks the ability of the 3PD Contractor to make the CTCC facility available for the use to which it intended during the 25 year contract period and therefore avoid triggering unavailability events and the associated financial deductions that would be applied to the 3PD Contractor s Service Payment The section also includes a summary of the risk register being maintained and managed by the SEHSCT via the Project governance arrangements, in particular highlighting the key risks to the Project which remain in SEHSCT ownership and the mitigation strategies identified for these risks. DRAFT 10

13 Section 10: Post Project Evaluation and Benefits Realisation 1.58 This section describes the structures and procedures that will be in place to manage and monitor the Project from Preferred Bidder appointment onwards. Organisational Arrangements 1.59 The internal organisational structures and arrangements that will support the activities to be undertaken during the Preferred Bidder stage, and subsequently during both the construction and operational phase of the Lisburn PCCC Project are summarised below: Preferred Bidder Stage - The organisational arrangements for the management and monitoring of activities to be undertaken during the Preferred Bidder stage shall continue in line with the project governance and management arrangements applied by the SEHSCT during the procurement phase; Construction Stage - It is expected that the existing Project level governance and management arrangements applied by the SEHSCT during the procurement shall continue to apply throughout the construction phase of the Project, albeit the frequency of the meetings of the HIB Procurement Sub-group may reduce during this period; SEHSCT Commissioning Phase - In the circa 2 to 3 month period following building completion and handover the SEHSCT Project Team shall be responsible for undertaking post-completion commissioning activities; Operation Stage - Following completion of the construction phase and the signature of the Lease and Sub-Lease agreements, responsibility for day-to-day management of the Lease with the Contractor (and Sub-Lease arrangements with the GPs) shall rest with a nominated SEHSCT Contract Manager. Benefits Management 1.60 This section also details the anticipated project benefits as well as the arrangements for benefits realisation and sets out the draft Benefits Realisation Plan, which has been devised to facilitate the management and delivery of the agreed benefits. This plan identifies the expected benefits, the timing of the benefits, a means of measuring the achievement of each expected benefit, and the party responsible for each benefit realisation activity Each benefit is assigned to an operational owner who is responsible for the measurement and reporting level of achievement against the profile. The Project Board will monitor the realisation of benefits under the direct control of the SEHSCT Section 11: Process from Preferred Bidder to Contract Award 1.62 This section of the ABC sets out details of the key activities and timelines associated with the process of moving from Preferred Bidder to Contract Award, to include estimated implementation timescales for contract award, construction works, and operation commencement based on the programme outlined in the Preferred Bidder s Final Tender Details are also provided in respect of the following: Preferred Bidder appointment, including the Alcatel period and bidder debriefing; DRAFT 11

14 Requirements for full planning and judicial review periods; Interaction with the Preferred Bidder on reviewable design data process, contractual fine tuning, benchmarking of funding terms and financial model audit requirements; Engagement with GPs by HSCB and SEHSCT; Preparation, submission and approval of the Full Business Case; and Preparation for contract award /financial close The section also highlights the interdependencies with the Enabling Works programme that will be undertaken by the SEHSCT both during the period from Preferred Bidder appointment to contract award and subsequent to contract award and commencement of 3PD contractor construction works On the assumption that the ABC is approved in June 2015 and contract award occurs on 1 st April 2016, the table below provides a high level overview of the key project implementation milestone dates, as estimated based on the details included within the recommended Preferred Bidder s Final Tender submission It should be noted that table below table reflects the three month period required for the completion of the Enabling Works by the SEHSCT subsequent to contact award/financial close, and assumes that the recommended Preferred Bidder s construction programme (as set out within their Final Tender submission received on 23 March 2015) moves out by 3 months as a consequence. Milestone Target Date Contract Award & Financial Close April 2016 Completion of Enabling Works by SEHSCT(i.e. red line site available for handover to 3PD Contractor) & 3PD Contractor Construction Works Commencement July 2016 Practical Completion (i.e. handover by 3PD Contractor) 00July 2018 Term Commencement Date* J00uly 2018 *Being the date 5 days after Practical Completion when the Annual Service Payment to the 3PD Contractor becomes payable by the Authority Section 12: Conclusions and Recommendations 1.67 This ABC reaffirms the strategic drivers for the PCCC as outlined in the OBC, and provides an update on the Project since procurement commencement in This ABC is ultimately seeking approval for the appointment of the recommended Preferred Bidder (as identified through the procurement process) and confirmation that the capital and resource budget cover required for the Lisburn PCCC will be made available There may be additional costs associated with the PCCC which are not factored into the capital and resource budgetary impact analysis presented within the ABC. Such costs may arise, for DRAFT 12

15 example, due to higher than expected inflation, accelerated delivery of the PCCC (and therefore a slightly longer Lease term), construction inflation uplift due to SEHSCT enabling works delays or early termination. The Authority will ensure that DHSSPS and HSCB are given as much notice as possible if it appears likely that additional funding will be required to cover these costs This ABC is being submitted to SEHSCT Board, HSCB Board and DHSSPS for consideration. Thereafter, an update will be provided to the Minister and approval will be sought to progress the Project with the recommended Preferred Bidder. DRAFT 13