At last week’s full council meeting, Cllr Chris Whitehouse (Con) raised objection to the extent of monies being spent by Isle of Wight council with consulting firm, Atkins.
The response from the Executive Member responsible has given a glimpse into the mess of the Road PFI scheme the delivery of which he labels “a shattering display of incompetence”.
Examining the PFI contract
Atkins were called in by the council in February 2015 to examine the highways PFI contract that had been set up by the previous Conservative council administration.
Earlier this week, Cllr Whitehouse called for an “urgent investigation” into payments to Atkins, claiming “£300,000 has been paid to this firm when all we agreed was around £30,000”. (Full details of the press release he issued)
Work was “always within the annual budget”
In response Cllr Phil Jordan (Ind), the Executive member now responsible for the PFI contract, told OnTheWight that monies for this work was always within the annual budget and held within contingencies and reserves, which senior officers can use to ensure ‘business as usual’.
He went on to say that through examination of the highways PFI contract, Atkins have identified many contractual issues and compiled the necessary data so these can be raised with Island Roads.
Cllr Jordan said,
“The disputed amount with Island Roads runs to millions of pounds over the life of the contract.”
“Ignorance of facts and lack of respect”
At last week’s council meeting, it was revealed that councillors had specifically been asked not to raise PFI questions because of the legal process now underway.
However, as well as asking questions in the chamber last week, on Monday Cllr Whitehouse issued a press release.
In response, Cllr Jordan said,
“Cllr Whitehouse disgracefully demonstrates his mixture of ignorance of facts, non-engagement at County Hall and lack of respect of the difficulties surrounding this process we are currently engaged upon.”
PFI contract “did not meet the needs or requirements”
For those not familiar with the situation the council is faced with – in relation to the disputed PFI contract – Cllr Jordan went on to give a more detailed explanation,
“This administration inherited, in May 2013, one of the most controversial contracts this Authority have ever had.
“The previous Conservative administration, which included a number of the current County Hall Conservative group (though not Cllr Whitehouse) spent £7M on procuring a contract that did not meet the needs or requirements of this (Highways) Authority.
“From the very outset, problems of a contractual nature became apparent and we have spent the past two and a half years attempting to resolve them and they are not finished yet.”
Last admin left no one qualified to oversee project
He went on to add,
“To make matters worse, that very same Conservative administration transferred every Highways Department officer into the service provider, under TUPE, leaving no capacity or experience of civil engineering within the Authority. In fact, leaving no staff to manage our Highways.
“It then took the decision to employ three officers (transferred from within the Council) to oversee and manage a complex civil engineering project/contract worth around £500m.
“None of those officers had/has any civil engineering qualification.”
Jordan: “Previous Conservative administration failed residents of this Island”
In a damning statement, Cllr Jordan went on to explain the contract delivered by these staff was “insufficient and inappropriate for the Island”.
He said,
“Having spent £7m on procurement, they delivered a contract that is insufficient and inappropriate for this Island, containing all manner of shortcomings from a Council perspective. They transferred all experienced and qualified staff out of the Authority and then employed an insufficient number and unqualified staff to manage the largest contract this Authority have ever had.
“To say that administration has left us a legacy that reverberates across our Island today is a gentle understatement. In fact the previous Conservative administration actually failed the residents of this Island by delivering the PFI contract in a shattering display of incompetence. In fact, they misled the residents of this Island by insisting this contract was the “all singing, all dancing answer to our highway problems”. The contractual dispute demonstrates that not to be the case.”
Payments to Atkins
In terms of the current costs payable to Atkins, Cllr Jordan said,
“The decision by the MD and Deputy MD to appoint Atkins was to initially undertake work on a number of areas, which included looking at CMT (contract management team) structure and resources, and work upon some specific engineering projects and service areas that required civil engineering expertise and backgrounds, including quantity surveying, costing and design.
“This decision was taken under normal circumstances – officers at this level are able to take such decisions – under an existing Framework agreement with estimated costs thought to be in the region of £150,000. That was not a set figure, but a figure thought to be reasonable and achievable. At some point, this matter passed through the internal procurement board for recognition.
“To some extent, the (lack of) posts of two civil engineering officers were taken into account and offset against the estimated costs. Very roughly, two full time civil engineering officer cost would be in excess of £100,000 with all add on costs.
“The decision to continue with Atkins was taken as their work had started to identify further contractual issues and we needed expertise to investigate and compile the necessary data to engage with service provider on disputed contractual matters. We did that and at the same time entered into dialogue with service provider over contractual clause disputes. This was informed in no small way by Atkins work. Those discussions eventually failed in October 2015.
“The amount for this work was always within the annual budget and held within contingencies and reserves which senior officers can use to provide service continuation (business as usual….) when required.
“The disputed amount runs to millions of pounds over the life of the contract.”
Cllr Jordan: “Cllr Whitehouse is not sufficiently engaged”
As was raised at the council meeting last week (see our live coverage), Cllr Jordan mentions the lack of councillor briefings attended by Cllr Whitehouse in the last two and half years, according to him just two out of 51.
Member briefings are there for the benefit of councillors in order to grasp a deeper understanding of the issues being faced by the council – to better inform their own decision-making.
Given the apparent low level of attendance, OnTheWight has asked Cllr Jordan to confirm the numbers, which he did. We also contacted Cllr Whitehouse as a courtesy, who, post-publishing, didn’t deny his low level attendance and when asked if he was not missing out on vital information, he replied, “Not at all.”
Cllr Jordan said,
“Every Councillor was aware of the Atkins work from the outset, not the detail, but the fact they had been employed.
“Every Councillor was made aware of the legal dispute process taking place and my Full Council report (November) asked Members to respect that position and not ask questions in a public forum that could/would not be answered. That was respected by all Members…..apart from Cllr Whitehouse.
“Cllr Whitehouse has never contacted me privately about any matter – whereas many/most other Councillors do engage and ask for information – he is absent from not only County Hall but often the Island, whilst he manages his London-based company and perhaps why he is absent. He prefers, it seems, to conduct his limited work through the press and media.
“He has already missed three Full Council meetings this year and three other occasions he either arrived late or left early. In fact, he was not present in the Chamber when the vote on the annual budget took place earlier this year.
“Worst of all, he has attended just two of 51 Member briefings since June 2013, three of which (two in 2015) were specifically about the Highways PFI contract.”
Cllr Jordan finished by saying,
“The truth is that, in my view, Cllr Whitehouse is not sufficiently engaged with County Hall to know and understand the complexities of what is going on and what, even, are normal procedures and processes.
“It is not unconnected that Cllr Whitehouse is the least engaging and attending Councillor at County Hall yet the most publicly vociferous over matters he has little grasp, as a direct result of his absences.
“We, as an Authority and as an Administration, continue to strive to sort out the absolute mess the previous administration left across a wide range of service areas and it is testament to that fact that having spent £7m and taken five years to deliver a contract that was contentious from the outset, it has assured that three years later we are still dealing with the problem it has delivered, which include incurring even further costs (to the £7m contract procurement costs) in employing qualified civil engineering consultants and now experienced Lawyers.
“When the process is finally resolved, though that may take some time in its entirety as the current dispute process is only part of the overall problematic issues to resolve (probably through further dispute resolution processes), we will be able to make the public fully aware of the extent of the failings of the previous Conservative administration specifically in regard to the Highways PFI contract.”
Cllr Whitehouse’s press release
Below is the press release issued by Cllr Chris Whitehouse on 30 November 2015:
A member of the Isle of Wight Council has called for an urgent investigation into payments of almost £300,000 to the consulting firm, Atkins, as part of a dispute between the Council and Island Roads which has the contract to maintain the island’s road network.
Cllr Chris Whitehouse (Conservative, Newport West Ward) has written to the Council’s Monitoring Officer to ask for an urgent investigation because the funds were not in the approved current Budget of the Council and do not appear to have been authorized by any decision of the Executive or the Full Council.
Speaking today, Cllr Whitehouse says: “I was shocked to find that almost £300,000 has been paid to this firm when all we agreed was around £30,000. We have now paid ten times that amount and the bills, we are told privately, are still mounting.”
A schedule of the payments is attached.
“This is no way to behave with substantial amounts of public money” Cllr Whitehouse adds “What is more, when I asked about this at Full Council last week I was met with a petulant outburst by Cllr Jordan who refused to provide the information. That is no way to behave in public office and brings the Council into disrepute. Islanders are entitled to know why this money has been paid, who approved that payment and why that decision was not referred either to the Executive or to the Full Council for approval.”
Updated 13:10: Added Cllr Whitehouse’s response.
Image: LissaLou66 under CC BY 2.0
