DD2420 Skills for Londoners technical due diligence

Type of decision: 
Director's decision
Code: 
DD2420
Date signed: 
09 March 2020
Decision by: 
Philip Graham, Executive Director, Good Growth

Executive summary

The Skills for Londoners Capital Fund (SfLCF) programme was approved by the Mayor on 7 August 2017 under cover of MD2142. The Mayor also delegated (under cover of the same Decision form) approval of allocations of £114m of SfLCF funds to the Executive Director of Development, Enterprise and Environment, considering the recommendations of the London Economic Action Partnership (LEAP).

The SfLCF continues to invest in the estate and equipment of skills providers, with a further funding round planned in 2020. The Fund continues to support the delivery of high-quality skills that employers need, in settings that are modern, fit-for-purpose and provide spaces that will support learners across London.

This Decision requests approval for expenditure of up to £150,000 funding from the £5m of
revenue funding contained within the overall SfLCF, as detailed in MD2142, to cover costs of technical/specialist due diligence in support of assessment of proposals received for the remaining delivery of the SfLCF.

Decision

That the Executive Director of Good Growth approves revenue expenditure of up to £150,000 on services required to conduct technical due diligence activity including cost consultancy and building advice for the remaining delivery of the SfLCF.

Part 1: Non-confidential facts and advice

Introduction and background

Skills for Londoners Capital Fund (SfLCF) launched in April 2017 with a total of £114m available for investment in the estate and equipment of London's skills providers. It supports the delivery of high-quality skills that employers need, in buildings that are inspiring and fit-for-purpose and reflect the working environments, collaborative spaces and the new ways of working of industry’s workplaces and spaces.

Round 1, held in 2017/18, awarded £32m to 62 projects through the main fund, the Small Projects and Equipment Fund and the Development Support Fund. In April 2019 as part of SfLCF Round 2, the LEAP Investment Committee awarded 17 projects £57.6m funding including £7.2m from the Mayor’s Construction Academy (MCA) fund.

It is proposed that expenditure of up to £150,000 is approved for enhanced specialist due diligence services for upcoming rounds of SfLCF.

The expenditure of £150,000 for enhanced specialist due diligence services was endorsed at the LEAP Programme Board meeting on 12th September 2019.

Objectives and expected outcomes

We are seeking to procure and appoint specialist due diligence services to carry out an assessment of project applications (including cost and building surveying), to ensure the viability of projects applying to the SfLCF. The advice will be separated into a separate consultancy contract for cost and construction/property advice respectively.

Building surveyor services will provide the GLA (for individual project applications) an appraisal of construction/property issues including technical, risk management, programme, legal, environmental, building regulation and restoration matters.

Cost consultant services will provide the GLA with an appraisal of individual project applications which may include, but not limited to the assessment of construction costs against project outcomes; projected construction costs against industry benchmarks; the adequacy and value of any contingencies included in the project and any other related activities to complete the due diligence and appraisal of project applications.

The current due diligence service contract is due to expire, and a new contract is required. The remaining SfLCF will be delivered through a forthcoming round and will require detailed due diligence on successful proposals. In order to ensure procurement efficiencies, the service will be sourced for ongoing services through a call-off contract in line with the previous procurement, to allow for future rounds, with appropriate break clauses in place should the service not be required.

Officers will liaise with TfL Commercial to procure the services required competitively in accordance with the GLA’s Contracts and Funding Code.

Equality comments

The GLA is required, in the exercise of its functions, have due regard to the need to:

a) eliminate discrimination, harassment, victimisation and any other conduct that is prohibited by or under the Equality Act 2010;
b) advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it; and
c) foster good relations between persons who share a relevant protected characteristic and persons who do not share it.

Proposals for the due diligence contract will have to demonstrate their understanding of the Mayor’s Equality, Diversity and Inclusion Strategy to ensure projects are evaluated and monitored will meet the strategies priorities and help to reduce the disability, gender and race employment gaps in addition to meeting the Public Sector Equality Duty. This encompasses integration of the Accessible London Supplementary Planning Guidance and Policy D5 of the draft London Plan (both of which support the latest inclusive design standards BS8300-1:2018 and BS8300-2:2018).

Other considerations
  1. key risks and issues 

Risk

Impact

Mitigation

Too few bidders from the framework apply

If fewer bids are submitted than expected or poor-quality bids are received, the programme will be unable to appoint a suitable specialist(s).

The procurement methods which are to be utilised will ensure frameworks are engaged to procure the service(s).  Frameworks have been used for similar procurement previously and have been successful in only putting forward those who are suitable. This will be on a call off basis to ensure the best response to the specification as when required.

Delays in appointing suitable specialist(s)

Any delays will mean some projects are not able to receive essential feedback on their proposals and will in turn delay the grant agreement process.

The procurement process will begin as soon as possible, and potential specialists will be made aware they will be required to begin delivering promptly after a contract is signed.

 

  1. links to Mayoral strategies and priorities
  1. The due diligence exercise will assess SfLCF projects at application stage to determine if they will deliver high-quality learning and training environments through the development, modernisation and rationalisation of facilities through viable good value construction projects and as necessary will also be subject to design review during the design and implementation phase. Design reviews will be undertaken by a panel of Mayor’s Design Advocates.
  2.  
  3. Investments through the SfLCF will contribute to the Mayor’s and the LEAP’s drive to make London a better place in which to live and work and to visit, through delivery approaches that secure the highest levels of social, economic and environmental value.
  4.  
  5. SfLCF programme overall aligns with relevant policies of the draft London Plan and contribute positively to the Mayor’s planning objectives relating to Design (Chapter 3), Social Infrastructure (Chapter 5), Green and Sustainable Infrastructure (Chapters 8 and 9), transport (Chapter 10), affordable housing (Chapter 4, Policy H6 and H7) and the Mayor’s Affordable Housing and Viability Supplementary Planning Guidance. 
  6.  
  7. In alignment with the London Environment Strategy, SfLCF programme is supporting projects to integrate creative solutions to environmental sustainability and demonstrating how they align with the Mayor’s environmental priorities. The due diligence exercise will assess project ambitions to achieve maximum environmental benefits by meeting BREEAM ‘Outstanding’ for new build projects and ‘Excellent’ for refurbishment projects.
  8.  
  9. The Economic Development Strategy (EDS) priorities are supported by the SfLCF and due diligence of the outputs of projects to encourage collaboration with local businesses, employers and local authorities to support the creation of jobs within the local area and the delivery of training to support growth sectors.
  10.  
  11. The wider programme aims to align with the key priorities set in the Skills for Londoners Strategy and this will be detailed in the specification during procurement.
  12.  
  13. c. consultations and impact assessments

Any future round will be based on a direct response from existing and potential providers.  Currently officers are gathering evidence of need to support a new round of SfLCF. There is also a an email address on the SfLCF webpage to send any queries. Officers have complied with GDPR legislation. 

No one involved in drafting or clearing this form has any conflicts of interest to declare.

Financial comments

Approval is being sought for expenditure of up to £150,000 on technical advice services relating to technical due diligence activity including cost consultancy and building advice for the remaining delivery for the Skills for Londoners Capital Fund.

The proposed expenditure of £150,000 will be funded from the £5m revenue allocation earmarked to support the Skills Londoner Programme as approved by MD2142. It is expected that the procurement of the specialist advice will commence in 2019-20 but costs will be incurred in the 2020-21 financial-year supporting delivery of the next phase of projects.

Activity table

Activity

Timeline

Procurement of contract

     March 2020

Appointment of contractor

     April 2020

Delivery Start Date

     April 2020

Delivery End Date

     March 2021


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