Bath Spa Costing

Bath & North East Somerset Council

MEETING: MEETING DATE: TITLE: WARD: Council 13th July 2006 Spa Project and Spa Claims Management Funding 2006-07 ALL AN OPEN PUBLIC ITEM List of attachments to this report: Appendix 1: Spa Project Third Party Funding 1 THE BACKGROUND AND THE ISSUES 1.1 The Bath Spa project has been affected by a number of technical problems and delays. During the project, the contract with the main contractor was terminated. The Council has completed the works using a different procurement structure. 1.2 The project (the Spa Project) was certified as Practically Complete on 8 May 2006. The Council has incurred significant spending in order to achieve this. 1.3 The Council has also sought advice regarding potential claims to be brought by the Council against third parties and by third parties against the Council (the Spa Claims Management Project). 1.4 Based on the figures available, the range between the Council being wholly successful in all disputes and wholly unsuccessful could be as much as plus or minus £10m-£15m (excluding claims handling costs and interest). 1.5 This report updates the Council about progress and future actions since the last report in March 2006. In particular, this report outlines the additional funding believed to be required: a) to complete the Spa Project to legal transfer to the Operator; and b) for the Spa Claims Management Project in the next 8 months up to the end of March 2007. 1.6 There will be a further update report to Council by March 2007, including any further potential funding requirement.

AGENDA ITEM NUMBER

2 RECOMMENDATIONS The Council is asked to: 2.1 Approve further funding of £800k for the completion of the Spa Project to legal transfer to the Operator, £610k to come from the general capital contingency in 2006-07 and £190k from unallocated revenue reserves. 2.2 Approve further funding of £1,790k required to continue the claims and final account preparatory work within the Spa Claims Management...