Filling GAB could save $2M
(CNS): One of many shortcomings identified in the latest report by the auditor general, the failure to establish proper business needs on major projects before embarking on them has been extremely costly. The new government administration building is, according to Alastair Swarbrick’s latest findings, only 60% occupied but could be saving the public purse some CI$2 million a year in leases if government entities actually move into it. Although government entities such as CIMA and MACI had signed on to move into the building and had offices designed for them, the failure to establish a proper process before the project started to assess who really should, or needed to, utilize the building has resulted in wasted space.
Despite having 100s of square feet unoccupied in the building, government departments and agencies continue to lease accommodation all over the George Town area. Swarbrick stated that if the new energy efficient building was properly utilized there could be significant savings to the public purse as he urged government to use the building.
Speaking at a press briefing Thursday about his latest report, "Management of Major Capital Projects", he said someone needed to take the lead and fill the building.
“Government could save more than $2 million per year if it used the space effectively and reduced the existing commercial leases," he said. “It is a highly efficient building.”
At the end of the audit, the General Administration Building housed about 580 staff. The problems stemmed from the failure at the outset to properly define government’s needs in a strategic business case and no one officially signed for the responsibility at the beginning to see which government departments would move in, Swarbrick explained.
The Cayman Islands Monetary Authority (CIMA) and the Maritime Authority of the Cayman Islands (MACI) had both signed on to move to the new building but a decision was made later that they would not do so after all. Swarbrick said it was unclear why the decision was made so much later but there was no coordination at the beginning with the various groups involved in the development of the government building. Throughout the life of the project, which entities would and which would not move in constantly changed.
The auditor stated that the building should have been designed based on a proper business plan that properly defined and set out the exact needs of government, which may have resulted in a smaller building and some savings.
“There was a lack of clarity over the responsibility for identifying which government agencies were to be tenants in the new building,” the report states. “We could not identify a Government ministry that had the overall responsibility for determining the Government’s accommodation policies and needs.”
They pointed out that the relevant ministry and its steering committee did not have the mandate to determine which agencies would eventually be housed in the building and that was left to the project management team.
“Numerous lists of potential tenants were prepared, considered by the steering committee, and then presented for approval by Cabinet. However, for various reasons, some of which are not clear to us, the lists continued to change from the date of Cabinet approval to proceed with the project, throughout the development of the request for proposals, after the construction began, and even after construction was substantially complete,” the report says.
The constant changes pushed up the cost of the building and led to delays in the project leaving the building under-utilized.
“While Cabinet was warned about the impact that changes could have in terms of additional costs and project delays, the changes continued nonetheless. The ineffectiveness of the reporting relationships to ensure that there was better control over project governance was clearly documented in the files we examined. These documents reflected a situation where some agencies refused to relocate to the GAB and others made unreasonable demands for changes to the design even into the construction period."
Swarbrick noted, however, that the foresight of the project manager's proposal that the building be designed for flexible use ensured that the extent of that cost has been minimized.
Although there are problems over government’s use of the GAB, Swarbrick said that the CTC process was followed properly and the project was well managed and could be used as a standard for future projects.
“Government assigned a well-qualified and experienced project manager … who employed industry accepted project management practices that should be considered as standard practice for the management of all future major capital projects,” he said, adding that it was the manager who in the end saved money for the public purse by overcoming the significant challenges and changes associated with the project.
By contrast, the report is considerably more damning regarding the management of the three high school projects and points to serious losses to the public purse.
Check back to CNS next week for more on Swarbrick's latest revelations.
See full report below.
|Management of Major Capital Projects - 20 June 2012 -.pdf||1.1 MB|
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