Public Accounts Committee
Thursday 9th July 2026
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10:00
Speaker 1
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Speaker 1
On Thursday the 9th of July. Today. Um. Be examining the programme of works to restore and renew the Palace of Westminster. As many of us see first hand, the Houses of Parliament needs significant work to restore and renew them. Parliament spends a substantial sum each week, around 1.5 million on patching up the palace, while the list of health and safety incidents continues to grow, the programme is now at a critical stage. Parliamentarians are being asked to reduce the number of daily options delivery options from 4 to 2 and approve the initial phase one works, which are currently capped at 3 billion.
I think it is commonly accepted that if we can get as much consensus around phase one, we. Are more likely to get Parliament to approve the whole project because if they don't, I think we will be left with a very critical problem of trying to maintain a decaying building. So I remain concerned. There is not enough a clearly articulated vision for the programme, without which costs and timescales will remain uncertain. There will also be an impact to procurement and tendering process, which is bound to result in higher costs.
Parliament also needs to be very clear on a simple and effective governance mechanism, which is designed for delivery so that once contracts are let, the project starts, there is appropriate scrutiny from and not only appropriate scrutiny, but hopefully a minimum number of alterations from the original contract from beginning to end. So today, the committee will examine when more information about phase one and particularly the temporary accommodation arrangements will be available, and to explore how the government's arrangements could be reset to support scrutiny of the programme's delivery. And I would simply say this if this generation doesn't defend our system of democracy, of which the Houses of Commons are at the heart of, we can't expect the next generation to defend it in the same way as it has been defended in the past.
So this project, I think, is very critical to our country's future. So thank you, both Charlotte and Russ for attending. Um, now, how we do this is please, if you would each introduce yourselves, just say who you are, what you do, and how long you've been doing it would be really helpful. Charlotte, welcome. Good morning.
I think it is commonly accepted that if we can get as much consensus around phase one, we. Are more likely to get Parliament to approve the whole project because if they don't, I think we will be left with a very critical problem of trying to maintain a decaying building. So I remain concerned. There is not enough a clearly articulated vision for the programme, without which costs and timescales will remain uncertain. There will also be an impact to procurement and tendering process, which is bound to result in higher costs.
Parliament also needs to be very clear on a simple and effective governance mechanism, which is designed for delivery so that once contracts are let, the project starts, there is appropriate scrutiny from and not only appropriate scrutiny, but hopefully a minimum number of alterations from the original contract from beginning to end. So today, the committee will examine when more information about phase one and particularly the temporary accommodation arrangements will be available, and to explore how the government's arrangements could be reset to support scrutiny of the programme's delivery. And I would simply say this if this generation doesn't defend our system of democracy, of which the Houses of Commons are at the heart of, we can't expect the next generation to defend it in the same way as it has been defended in the past.
So this project, I think, is very critical to our country's future. So thank you, both Charlotte and Russ for attending. Um, now, how we do this is please, if you would each introduce yourselves, just say who you are, what you do, and how long you've been doing it would be really helpful. Charlotte, welcome. Good morning.
10:03
Speaker 2
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Speaker 2
Thank you very much, chair. I'm Charlotte Simmons, I'm the managing director of the Restoration and Renewal client team. So I work on behalf of the clerk of the House of Commons and the clerk of the parliaments to oversee and sponsor this programme. And I have been working on R and R directly since 2019, but joined the House in 2008. When I started working on some elements of R and R. So I think.
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Speaker 1
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Speaker 1
Okay. Very good. Well, we'll we'll go into questions now. Um, I think there are about four key concerns, uh, amongst members of Parliament. And I suspect that, um, they, they range from, um, whether we're a peer or a member of Parliament, how long we're going to be out. Um, they also range from whether we're going to come back. People are very concerned that they won't come back and that the fixtures and fittings um are. Will remain largely as they are.
If they're removed they'll be returned. But I suppose the fourth one of those is the costs. And I think the more we can do. Um Charlotte and Russ to reassure um peers and members of Parliament on costs, the better we will succeed when it comes before the Parliament. So let's just start with phase one. Is there anything more you can do to give us a sort of. I read the document last last night, but I have to say, if you read those pages on relation to phase one, it almost is a sort of an obfuscation in how not to tell you.
Tell us what you're going to do. So is there any way you can clearly tell us what you're going to do in phase one and, and allocate to each of those items a cost so that if nothing else, both the Nao and ourselves can keep scrutinising it. Um, because if nothing else, if we don't get phase one right, I think there's a propensity for the whole thing to start to go wrong.
If they're removed they'll be returned. But I suppose the fourth one of those is the costs. And I think the more we can do. Um Charlotte and Russ to reassure um peers and members of Parliament on costs, the better we will succeed when it comes before the Parliament. So let's just start with phase one. Is there anything more you can do to give us a sort of. I read the document last last night, but I have to say, if you read those pages on relation to phase one, it almost is a sort of an obfuscation in how not to tell you.
Tell us what you're going to do. So is there any way you can clearly tell us what you're going to do in phase one and, and allocate to each of those items a cost so that if nothing else, both the Nao and ourselves can keep scrutinising it. Um, because if nothing else, if we don't get phase one right, I think there's a propensity for the whole thing to start to go wrong.
10:06
Speaker 2
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Speaker 2
On that if it's okay. Chair. Um, we have a further summarized the information in the Cost of proposals report and published, um, a new leaflet for members. But this does replicate what's in the report. So we recognise that it was part of chapter seven of a very large report. So we've tried to make it more accessible to people. Notwithstanding your. Main point about what are the elements at a high level?There are four elements.
There's the resilience works, which is temporary accommodation. There is enabling works, which is. Any works required to, um, kind of, you know, the nuts and bolts of getting site compounds set up, um, and diverting services and so on. There is early works where we can start to undertake that in specific areas within the palace. And then there's the really.
There's the resilience works, which is temporary accommodation. There is enabling works, which is. Any works required to, um, kind of, you know, the nuts and bolts of getting site compounds set up, um, and diverting services and so on. There is early works where we can start to undertake that in specific areas within the palace. And then there's the really.
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Speaker 2
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Speaker 2
So, uh, programme management, procurement and detailed design so that pre-construction activity, uh, is around £860 million. Um it also includes the fit out which has a cost of around £417 million presently. And for the House of Commons, um, the preferred location is Richmond House. Should there be any temporary chamber, but otherwise to house the Commons on the northern estate. So this building back to Richmond House and Norman Shaw South. Um uh, but that work is being undertaken by an in-house team, uh, under the Commons building infrastructure portfolio.
Within that, the R&R related works to do with providing a temporary chamber or a chamber space is around £328 million. There are some other areas of, uh, temporary. Accommodation as well. Very important for our heritage collections. We have about 26,000 heritage items in our collection. Um, and so there will be moves and leases, um, and the costs of a heritage facility, uh, which the moves and leases come out to about £75 million and the heritage facility, £66 million moves and leases, um, and the cost of heritage facility, which the heritage items in our collection, um, uh, and so there will be moves and leases come out to about £75 million and heritage facility, £66 million.
Um, is this a good way to go through this for you, chair?
Within that, the R&R related works to do with providing a temporary chamber or a chamber space is around £328 million. There are some other areas of, uh, temporary. Accommodation as well. Very important for our heritage collections. We have about 26,000 heritage items in our collection. Um, and so there will be moves and leases, um, and the costs of a heritage facility, uh, which the moves and leases come out to about £75 million and the heritage facility, £66 million moves and leases, um, and the cost of heritage facility, which the heritage items in our collection, um, uh, and so there will be moves and leases come out to about £75 million and heritage facility, £66 million.
Um, is this a good way to go through this for you, chair?
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Speaker 2
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Speaker 2
So I will keep going. Um, then in terms of early work, thousand heritage items in our collection, um, uh, and so there will be moves and leases, um, and the costs of a heritage facility, uh, which the moves and leases come out to about £75 million and the heritage facility, £66 million. Um, is this a good way to go through this for you, chair?
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Speaker 2
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Speaker 2
So I will keep going. Um, then in terms of early works, which includes internal works to Victoria Tower, um, and some of the underground works that's in the region of £140 million. Um, there will be additional surveys, be they archaeology, environmental fabric, asbestos surveys in the region of £90 million. There is a requirement for a river jetty to ensure that we can have riverside deliveries, because it's a very constrained site. And we will also require a cofferdam to do some work to the riverside at the palace.
Um, that is estimated to be about £70 million. And then there is the work to set up a site compound, which includes clearing the spine road. So the roads that you will walk from end to end in the palace of all the detritus of site cabins and other things that we have now, um, so that we can get access to those spaces. That's around £30 million. There is an additional £20 million for some early works in particularly targeted areas of accessibility, catering, um, security, logistics.
Um, and then there are three areas within that package of works that have yet to be quantified and work is underway. One is Riverside security. And I've said that we need a river jetty and we also need a cofferdam. But generally speaking Parliament um is undertaking a security programme. And, and therefore we need to understand what security would be required to put in place the R&R elements on the Riverside. Those conversations are ongoing with the security teams. Um, and we also will need to isolate, decommission and relocate the bicameral services.
That work is complex and is underway between the delivery authority and the in-house team strategic estates. Um, and the last one that needs to be confirmed is the medieval cloister court and the work that needs to be done inside to conserve one of the three medieval bits remaining of the palace. Those three areas in all of those items of work sit within that £3 billion cap. So even though they haven't been quantified, those three areas, they all sit within the cap. And if it helps to know about two thirds of those, uh, the number of those items are to be delivered by Russ's team, the delivery authority.
About a sixth will be delivered by the in-house team, and then the remainder of the cap is our contingency. And to accommodate those additional items.
Um, that is estimated to be about £70 million. And then there is the work to set up a site compound, which includes clearing the spine road. So the roads that you will walk from end to end in the palace of all the detritus of site cabins and other things that we have now, um, so that we can get access to those spaces. That's around £30 million. There is an additional £20 million for some early works in particularly targeted areas of accessibility, catering, um, security, logistics.
Um, and then there are three areas within that package of works that have yet to be quantified and work is underway. One is Riverside security. And I've said that we need a river jetty and we also need a cofferdam. But generally speaking Parliament um is undertaking a security programme. And, and therefore we need to understand what security would be required to put in place the R&R elements on the Riverside. Those conversations are ongoing with the security teams. Um, and we also will need to isolate, decommission and relocate the bicameral services.
That work is complex and is underway between the delivery authority and the in-house team strategic estates. Um, and the last one that needs to be confirmed is the medieval cloister court and the work that needs to be done inside to conserve one of the three medieval bits remaining of the palace. Those three areas in all of those items of work sit within that £3 billion cap. So even though they haven't been quantified, those three areas, they all sit within the cap. And if it helps to know about two thirds of those, uh, the number of those items are to be delivered by Russ's team, the delivery authority.
About a sixth will be delivered by the in-house team, and then the remainder of the cap is our contingency. And to accommodate those additional items.
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Speaker 1
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Speaker 1
That was the next question. Russ. Really, how confident are you as the delivery of origin and bearing in mind it's not all within your control that you can actually deliver all of this, these works for 3 billion?Well, both of you really. I mean, what degree of confidence do you have?Because you need to be getting that across to Parliament.
10:14
Speaker 3
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Speaker 3
So, um, the answer is we're very confident. Um, I think the, um the important point is that each of those numbers that Charlotte gave you will already have some risk contingency within it. And then as Charlotte said, there's another 500 million on top of that that is effectively unallocated. Um, both for the items that aren't priced, but also things that might um be. Unforeseen if you like. Um, the other thing that I would say is that the work that we're doing during phase one tends to be activity that is a little bit easier to price.
It's at a more greater level of maturity. Things like design are easier to, um, take a perspective on how much it's going to cost. Clearly, some of the big risks in the programme will kick in during the main construction phase. So I think I'm more confident in the phase one activity, um, than would be the case for the, for the main programme where we've put very significant allocations and contingency reflecting the uncertainty in relation to the lower levels of design maturity.
It's at a more greater level of maturity. Things like design are easier to, um, take a perspective on how much it's going to cost. Clearly, some of the big risks in the programme will kick in during the main construction phase. So I think I'm more confident in the phase one activity, um, than would be the case for the, for the main programme where we've put very significant allocations and contingency reflecting the uncertainty in relation to the lower levels of design maturity.
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Speaker 3
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Speaker 3
So I think the other important point is that underneath the phase one plan are two very detailed schedules, a detailed schedule for the full decant option, and a detailed schedule for the EMI plus option. The client boards obviously recommending taking forward both of those options. And if you take the plans at face value, they proceed at different speeds. So effectively, the EMI plus option would proceed more slowly than the full decant option. One of the first things that we want to do within phase one is work to converge those designs, so that we end up with a common first seven years.
At the point we've done that convergence. Um, then we will absolutely be able to, um. Confirm in detail the contents of phase one.
At the point we've done that convergence. Um, then we will absolutely be able to, um. Confirm in detail the contents of phase one.
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Speaker 1
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Speaker 1
Now that's really helpful now. Uh, we you've recommended in this document and that, that there should be a vote in 2030, um, on which option you wish to take forward. Um, so there is a certain amount of work before you get to that 2030. And I'm really wanting to quiz you on whether you're going to be able to do it in the next six years. And probably the biggest bit of work within that is to, uh, talk to some contractors as to, uh, and I hope you will ask them to help you design this project and then cost it.
Um, can I commend to you the Bank of England's day Daily Settlements project, which is about one of the few projects in this committee we've examined that's been successful. And within that project, one of the main reasons they were successful was a process called competitive dialogue, in which case in which they had several contractors, but they basically got it down to, I think, 2 or 3. Uh, and paid them for their advice on design so that the contractor who didn't get the project had didn't waste their time.
So they were encouraged to put time in and give you the information as to how it should be designed. And then are you going to be able to, within the four years, come up with a. Preferred contractor with a reasonably certain cost range of. Whichever option we take forward the EMI plus or the decant, do you think that is feasible within that four year period?
Um, can I commend to you the Bank of England's day Daily Settlements project, which is about one of the few projects in this committee we've examined that's been successful. And within that project, one of the main reasons they were successful was a process called competitive dialogue, in which case in which they had several contractors, but they basically got it down to, I think, 2 or 3. Uh, and paid them for their advice on design so that the contractor who didn't get the project had didn't waste their time.
So they were encouraged to put time in and give you the information as to how it should be designed. And then are you going to be able to, within the four years, come up with a. Preferred contractor with a reasonably certain cost range of. Whichever option we take forward the EMI plus or the decant, do you think that is feasible within that four year period?
10:18
Speaker 3
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Speaker 3
Yes. So as you suggested, one of the very first activities within phase one is the procurement of our long term partners. We've already had partners involved in the programme, and they've helped us to develop the proposals that you're looking at today. But what we need to do is to move to the partners that are going to take us through the rest of the programme. Um, early contractor involvement is absolutely integral to the way that we want to deliver the programme to get the right expertise brought to bear very early.
And in terms of your specific question about how this plays out, moving to 2030, I mean, roughly speaking, a year and a half, two years of procurement activity, and then we would move into two around about two years of detailed design activity where we would take the concept designs we've got, develop them to the next level of maturity, to the point where we're ready to go for planning consent. And that would, under current plans, happen prior to 2030. So sat here in 2030, I would expect to have much more certainty around the cost ranges done as much as we possibly can to retire the risk.
So procurement risk clearly will be retired at that point. We will hopefully be well on the way to retiring. Some of the planning consents risks, and I think Parliament will then have a much better idea on the long term cost of the programme prior to its next decision.
And in terms of your specific question about how this plays out, moving to 2030, I mean, roughly speaking, a year and a half, two years of procurement activity, and then we would move into two around about two years of detailed design activity where we would take the concept designs we've got, develop them to the next level of maturity, to the point where we're ready to go for planning consent. And that would, under current plans, happen prior to 2030. So sat here in 2030, I would expect to have much more certainty around the cost ranges done as much as we possibly can to retire the risk.
So procurement risk clearly will be retired at that point. We will hopefully be well on the way to retiring. Some of the planning consents risks, and I think Parliament will then have a much better idea on the long term cost of the programme prior to its next decision.
10:19
Speaker 1
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Speaker 1
I'm sorry to committee members. I wasn't going to ask so many questions, but you did mention planning. Um, so how are you going to conduct the planning process?Because you've got two completely different operations that you've got to talk to the planners about. So you're going to go for two different planning applications, or are you going to talk to them about both?And then after 2030, confirm which one you're going for?How, how will that process be conducted?
10:20
Speaker 3
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Speaker 3
So our planning approach is to set out, broadly speaking, an overarching master plan, but then to bring forward packages of work in what we would call consent groups. Um and so by doing the planning incrementally in that way, the early consent groups, as I talked about earlier, we would seek to have significant amounts of commonality between the two options that we're taking forward. There will absolutely be some things that we would need to do two versions of. So an environmental impact assessment would be an obvious example.
The impacts associated with a 40 to 60 year programme of quite different to the impacts associated with the 2025 year programme. So some things will be parallel, but but we do think at the moment that we should be able to submit a single planning application within the phase one period that would allow us to get going and get on site to deliver the phase one works that we're setting out.
The impacts associated with a 40 to 60 year programme of quite different to the impacts associated with the 2025 year programme. So some things will be parallel, but but we do think at the moment that we should be able to submit a single planning application within the phase one period that would allow us to get going and get on site to deliver the phase one works that we're setting out.
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Speaker 1
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Speaker 1
Um I'm sorry, I apologize to the committee and anybody who's listening to our proceedings. I should have declared the fact that I am a fellow of the Royal Institute of Chartered Surveyors. I don't think I will personally, um, benefit from. Any of these works. I'm not expecting a great bung advance, but some of the members of my profession might. Um, okay, let's throw it open to my fellow committee members. Um, Catherine, I think you were next.
Please.
Please.
10:23
Speaker 4
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Speaker 4
Yeah. And, um, you got on very nicely to temporary accommodation, which is what I was going to ask about. Um, and. What decisions are going to have to be made. You've, you've highlighted the QE2 centre. Um and, and that that isn't actually yet a certainty. That's something that's going to have to be pursued. Um, what, you know, how, how are we going to make sure that we can drive the temporary accommodation process and decision making about what happens rather than being dictated by what's possible, um, in the circumstances.
And, and I guess this is quite important in many ways. It's a fairly small aspect of what is an enormous and hugely impactful project, but it's the part that most people will see. And also most members will experience. So I think it, it, it sort of exaggerated in its importance in that respect.
And, and I guess this is quite important in many ways. It's a fairly small aspect of what is an enormous and hugely impactful project, but it's the part that most people will see. And also most members will experience. So I think it, it, it sort of exaggerated in its importance in that respect.
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Speaker 2
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Speaker 2
I'm happy to come in. And yes, it clearly is very important. I would say the most important decision we need, first and foremost, is to have debates in the houses and to get direction from the houses of how they want to take this programme forward. Um, specifically in relation to temporary accommodation. Um, in 2024. So just before the last general election, the client board. So the two commissions published a report that indicated the preferred locations.
Queen Elizabeth Conference Centre for the Lords, Richmond House and Northern Estate for the Commons. That is consistent with numerous reviews that have been taken since the Joint Committee on the Palace of Westminster in 2016. So those are the ones that we are pursuing. Um and moving forward with all options require some level of decant. We already decant people when the works are too intolerable. And obviously it depends on which option you select as to which has most pressure full decant.
Obviously having the most pressure work is underway with political stakeholders and boards to develop the plans for temporary accommodation. But as I said, we do need direction from the houses. It's a balance for us because we don't want to have a delay on this programme. It's very costly to have delay on this programme, but we are conscious that we can't progress too far if we don't have the direction from the houses. So preamble. But to get on to your actual question about the decisions that we need, um, for the House of Commons Northern Estate requires a refurbishment regardless, and that is being delivered through the Commons Building infrastructure portfolio, as I said, Richmond House is the first building to be tackled through that portfolio, and it is the critical one for R&R under a full decant.
It would provide a replica chamber and the services under an EMI plus the other recommended option. It would provide a space for a contingency chamber. It's at concept design level. What we really need a decision on is or direction from the programme is to confirm the schedule and in a memorandum to this committee, the clerks have set out. There is some expected delay on that programme because an assumption around use of adjacent space hasn't come to fruition. So that's introducing about a four year pressure.
Sorry.
Queen Elizabeth Conference Centre for the Lords, Richmond House and Northern Estate for the Commons. That is consistent with numerous reviews that have been taken since the Joint Committee on the Palace of Westminster in 2016. So those are the ones that we are pursuing. Um and moving forward with all options require some level of decant. We already decant people when the works are too intolerable. And obviously it depends on which option you select as to which has most pressure full decant.
Obviously having the most pressure work is underway with political stakeholders and boards to develop the plans for temporary accommodation. But as I said, we do need direction from the houses. It's a balance for us because we don't want to have a delay on this programme. It's very costly to have delay on this programme, but we are conscious that we can't progress too far if we don't have the direction from the houses. So preamble. But to get on to your actual question about the decisions that we need, um, for the House of Commons Northern Estate requires a refurbishment regardless, and that is being delivered through the Commons Building infrastructure portfolio, as I said, Richmond House is the first building to be tackled through that portfolio, and it is the critical one for R&R under a full decant.
It would provide a replica chamber and the services under an EMI plus the other recommended option. It would provide a space for a contingency chamber. It's at concept design level. What we really need a decision on is or direction from the programme is to confirm the schedule and in a memorandum to this committee, the clerks have set out. There is some expected delay on that programme because an assumption around use of adjacent space hasn't come to fruition. So that's introducing about a four year pressure.
Sorry.
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Speaker 2
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Speaker 2
So we have both the palace and the northern estate are constrained. Um, they are tightly packed in and to undertake logistics work. So that's whether you need cranes or welfare. We have to find innovative solutions for that. Often looking outside our boundary and for Richmond House, the assumption was that we could use some space adjacent to Richmond House. That has not been proved possible. Um, and so the Delivery authority and Strategic Estates team are working collaboratively to try and mitigate that and bring that back down, reduce the time impact and the cost impact, largely through a phased availability of Richmond House and through a phased decant out of the palace.
But we need that schedule confirmed to give us certainty to move forward. And we also need to confirm the space allocation and what services will be provided for the House of Commons. The Cost of proposals report the Client boards cost of proposal report identified that if you have a full decant from the palace, you can't fit all the common services into the northern estate. It's just not possible. There's not enough space. So there was going to need to be a creative and purposeful approach to look to how we can make sure we can continue to provide proceedings and suitable and sufficient services to to facilitate the House of Commons.
Um R and R sets the requirements at a high level for temporary accommodation. And then it's for the Commons building infrastructure portfolio to design for that and discuss with the House Commission, the House of Commons Commission, um minimum service levels, business change and anything else. So. That's uh, to summarise, there's two things on the House of Commons temporary accommodation. The schedule and. Um the space allocation.
But we need that schedule confirmed to give us certainty to move forward. And we also need to confirm the space allocation and what services will be provided for the House of Commons. The Cost of proposals report the Client boards cost of proposal report identified that if you have a full decant from the palace, you can't fit all the common services into the northern estate. It's just not possible. There's not enough space. So there was going to need to be a creative and purposeful approach to look to how we can make sure we can continue to provide proceedings and suitable and sufficient services to to facilitate the House of Commons.
Um R and R sets the requirements at a high level for temporary accommodation. And then it's for the Commons building infrastructure portfolio to design for that and discuss with the House Commission, the House of Commons Commission, um minimum service levels, business change and anything else. So. That's uh, to summarise, there's two things on the House of Commons temporary accommodation. The schedule and. Um the space allocation.
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Speaker 3
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Speaker 3
So I think Cbip or the northern estate programme is on the cusp of settling its plans, if you like. Um, we would then react to those plans and build those into our own plans. Um I think that would probably need to happen in the next sort of 1 to 2 years to then do all of the things that I talked about earlier that allow phase one to play out in the way that we would expect it to play out. Clearly, there are some things that you could carry forward, but I think having some certainty in the next year to two would be helpful in terms of solidifying the plan so that when we get to 2030, we've got absolute clarity around what it is that the options present.
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Speaker 3
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Speaker 3
Yes. I mean, I don't think it's quite that sort of cliff edge. I think it's a programme that is in development. There are clearly some decisions that need to be made. Those decisions then need to be reflected into the northern estate programme. So I think it will be a much more incremental process than that. But it would be incremental alongside R and R, and as Charlotte said, we're working very closely together to make sure that as the northern estate programme iterates itself, our own programme iterates itself and the two two programmes do that side by side.
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Speaker 4
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Speaker 4
Okay. I've seen sounds very vague to me. Um, so. Um, I think it needs to, I think we need to be able to um, communicate that a bit clearer because it does just sound very vague and that there's lots of potential for a lot of elasticity in those time frames in what you're saying is that's just the impression I get. I think we need to be careful. So can you give some reassurance that these decisions are able to be taken in a, in a time frame that enables you to deliver the programme as currently intended?
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Speaker 2
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Speaker 2
So the report itself was drafted with the assumption that the debates would happen by Easter this year. We have not had debates by Easter this year. If we were to get debates by the summer. Um, there is, and I'm sure Russ can now find his cost implications of that. Um, but there is a cost of delay to that if we don't get debates until the end of this year, there is a further cost to delay. And if we don't get them into early mid next year, again, there's a further increase.
Um, if we can get decisions by the end of this year, we feel that we are absolutely fine and able to continue to pursue as planned. But if we go into next year, there are some real significant challenges.
Um, if we can get decisions by the end of this year, we feel that we are absolutely fine and able to continue to pursue as planned. But if we go into next year, there are some real significant challenges.
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10:35
Speaker 5
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Speaker 5
Thank you. Chair. Just a couple of points to follow on from Catherine, really. Um, which I think most of which have been covered, but just in terms of the overall phase one, I guess, including the temporary accommodation in terms of milestones and reporting, obviously that's something we as a committee are very keen on and making sure that things don't slip. So what will be in place to track progress through that seven year phase one process?And then the other question, just following on from, uh, from Catherine is who's accountable?Uh, if these, if the accommodation projects fall outside the programme, they fall back, sorry, fall outside the schedule.
10:35
Speaker 2
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Speaker 2
Okay. So in terms of how will we track your first question on how will we, track that?And if it's okay, I'll add in how we'll report it as well, because I think it's important for you to understand not just how we do it inside, but how we're reporting out and how members are involved. Um, so this phase one package of works is capped at £3 billion over seven years. That equates to about £429 million a year. It would obviously be profiled and presented to our, um, kind of boards and subject to scrutiny.
It's subject to scrutiny at official level. The delivery authority have their own internal scrutiny. My team apply scrutiny to the delivery authority we utilise.
It's subject to scrutiny at official level. The delivery authority have their own internal scrutiny. My team apply scrutiny to the delivery authority we utilise.
10:36
10:36
Speaker 2
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Speaker 2
Internally, my team scrutiny would be I have a number of assurance and and other experts. We also pull in the finance directors from both houses as part of this scrutiny. And then we also draw in independent experts. We always have the ability to pull in our independent advice and assurance panel, which is four leading experts on major programmes. Um, but we have also utilised consultancy support and other independent experts in, say, the field of health, safety and fire where we need them.
So we will bring those in to kind of scrutinise not just the costs and the schedule, but what's being delivered and importantly, how it's going to be delivered as well. Um, so that's the kind of official level that information is taken up to our board structure. It's member led for R&R. And at the top of that structure is the client board, which is the two house commissions meeting together. Um, to make strategic decisions. And then they delegate over day to day oversight to the member led R&R Programme Board, which has four independent experts, particularly with major programme experience and the clerk of the House and the clerk of the parliaments.
Um as the corporate officers and accounting officers, uh, sit on both the programme board and the client board, those boards scrutinise, as I said, the programme board goes into the detail. It also has a sub board to really get into the detail on. A on a monthly basis. Um so they will be scrutinising it. That's our level of scrutiny on uh the formal scrutiny is through the Parliamentary Works estimates commission also member led chaired by the chairman of Ways and Means.
But it's a bicameral commission. So it has members from both houses. Um and they have input from Treasury and they are looking specifically at the delivery authority estimate, although we provide all R and R spend to them. So they have visibility. Um they, uh, utilize public sessions to make sure we are having a level of public scrutiny on that as well. Um, so we have this regular, um, kind of process. We've got a number of other controls within that, that make sure.
So we will bring those in to kind of scrutinise not just the costs and the schedule, but what's being delivered and importantly, how it's going to be delivered as well. Um, so that's the kind of official level that information is taken up to our board structure. It's member led for R&R. And at the top of that structure is the client board, which is the two house commissions meeting together. Um, to make strategic decisions. And then they delegate over day to day oversight to the member led R&R Programme Board, which has four independent experts, particularly with major programme experience and the clerk of the House and the clerk of the parliaments.
Um as the corporate officers and accounting officers, uh, sit on both the programme board and the client board, those boards scrutinise, as I said, the programme board goes into the detail. It also has a sub board to really get into the detail on. A on a monthly basis. Um so they will be scrutinising it. That's our level of scrutiny on uh the formal scrutiny is through the Parliamentary Works estimates commission also member led chaired by the chairman of Ways and Means.
But it's a bicameral commission. So it has members from both houses. Um and they have input from Treasury and they are looking specifically at the delivery authority estimate, although we provide all R and R spend to them. So they have visibility. Um they, uh, utilize public sessions to make sure we are having a level of public scrutiny on that as well. Um, so we have this regular, um, kind of process. We've got a number of other controls within that, that make sure.
10:38
10:39
Speaker 2
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Speaker 2
So the programme board and the sub board meet monthly. We report monthly to them. Obviously it's ongoing. Um kind of arrangements and engagements between our teams. The client board meets on average about 3 to 4 times a year. Um but it will depend on what's kind of happening. And they met more frequently when they were approving the cost of proposals report and parliamentary works estimate commission must meet annually. But again, um meets more than that.
But for the last couple of years, we've had at least one annual public session with them. And so there's a number of other controls that sit underneath that, that mean that um. We publish all the, um, uh, da publish, all spend over 2500 pounds. The programme board, which I said is member led, they approve all Da commitments over £20 million. So there's a number of mechanisms within that, um that ensure that. So sorry. Yeah. I did say I'd talk about reporting and then completely forgot.
But for the last couple of years, we've had at least one annual public session with them. And so there's a number of other controls that sit underneath that, that mean that um. We publish all the, um, uh, da publish, all spend over 2500 pounds. The programme board, which I said is member led, they approve all Da commitments over £20 million. So there's a number of mechanisms within that, um that ensure that. So sorry. Yeah. I did say I'd talk about reporting and then completely forgot.
10:40
10:41
Speaker 6
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Speaker 6
Just to say that, I mean, in the same way we produced the report that the committee is using to inform today's session that, um, uh, you know, this obviously forms a significant part of our work programme in, in the coming years. And, um, if the committee or whatever scrutiny structures are set up specifically for the programme would find it useful. You know, I think it'd be an appropriate use of our resources to produce at least an annual update. Giving an independent take on progress, cost and schedule.
10:41
Speaker 1
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Speaker 1
I think that that, that, that sort of slightly independent view is very important. And I thank you for that. And that will enable us, Sarah, if we wish to scrutinise it on the back of that investigation. So I think that is an important extra level of scrutiny. But thank you for the really important question.
10:41
Speaker 5
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Speaker 5
I'm just sorry to say, I think, on the big projects that we've seen in the past, one of the big issues that we come up against time and time again is that lack of kind of monitoring throughout the processes. So if we can see it on a regular basis and have that ability to scrutinise as well, I think that would be very useful.
10:42
Speaker 2
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Speaker 2
And the clerks have allowed access to the Nao to do these value for money reviews because of the scale and sensitivity and significance of this, of this programme and all of that that I've just described, it takes part in the kind of normal parliamentary oversight. So members of both houses already have the ability to ask questions in the chamber, and they will be answered by the client board spokesperson or spokespeople, which are the commission House spokespeople. So Nick Smith, MP in the Commons and the Senior Deputy Speaker in the House of Lords and within the normal um account audit arrangements with the National Audit Office, auditing the Da accounts, the House accounts and also the Parliamentary Works grant.
So the fund for this programme, um, so in terms of, uh, kind of reporting and transparency, we will continue to, uh, to report up and out from this programme. Under the act, we're required to publish an annual report. We will continue to do that. We currently report on a quarterly basis, um, as well. Um, that, uh, as we move into delivery, we'll focus much more on performance and progress. And we will continue to have, um, kind of communicate about delivery elements as they go.
Hopefully as members, you're aware of some of the works that are going on on the parliamentary estate that affect you. We will continue to do that, and we will look for innovative means to do that. Last year, we piloted some bookable slots for people to come in and see the archaeological digs. They were very popular and we know some other mechanisms are preferred over others like video. So we will keep driving that forward. Um, the Lords has a slightly different arrangement where they also have an annual debate on R and R as part of their arrangements, which doesn't currently happen, uh, in the House of Commons.
Um, but. We'd be open to anything else that obviously members want us and we'll keep looking for opportunities. But the ideal is that we continue to be transparent, I should say, in that obviously all the minutes from the deliberations, from the boards are all available online.
So the fund for this programme, um, so in terms of, uh, kind of reporting and transparency, we will continue to, uh, to report up and out from this programme. Under the act, we're required to publish an annual report. We will continue to do that. We currently report on a quarterly basis, um, as well. Um, that, uh, as we move into delivery, we'll focus much more on performance and progress. And we will continue to have, um, kind of communicate about delivery elements as they go.
Hopefully as members, you're aware of some of the works that are going on on the parliamentary estate that affect you. We will continue to do that, and we will look for innovative means to do that. Last year, we piloted some bookable slots for people to come in and see the archaeological digs. They were very popular and we know some other mechanisms are preferred over others like video. So we will keep driving that forward. Um, the Lords has a slightly different arrangement where they also have an annual debate on R and R as part of their arrangements, which doesn't currently happen, uh, in the House of Commons.
Um, but. We'd be open to anything else that obviously members want us and we'll keep looking for opportunities. But the ideal is that we continue to be transparent, I should say, in that obviously all the minutes from the deliberations, from the boards are all available online.
10:43
10:44
Speaker 7
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Speaker 7
Have, thanks, chair. Um. The last information we had was that the temporary accommodation in Richmond House, which is essential for the House of Commons element of the work, may not be available until 2034, which is outside the seven year programme for the first part of the works. Um that's not acceptable is it?
10:44
Speaker 3
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Speaker 3
So just to be clear, the works that would be happening in phase one don't require any decant. Um the those works could progress irrespective of the availability of the northern estate. Um in terms of the broader northern estate question, you're absolutely right that the proposals laid out in the report assumed certainly for the full decant option, that there would be a full decant starting in 2032. We know that that's no longer possible because of the changes in the timeline to the northern estate. So what we've done is work really hard to mitigate that and now move to more of a phased approach to the decant.
So I think the first important point is that 40% of the floor plate of the palace is House of Lords. Our plan is to progress, subject to Parliament's decision, the QE2 programme, and that would allow the House of Lords to decant. That would give a significant footprint within the Palace, assuming we went down this full decant route, and I should probably say it does become a bit easier under the EMI plus scenario from a design perspective, um, in the commons end of the building, um, moving to a phase decant would effectively stage the commons decant, subject to the availability of northern estate accommodation.
So rather than a kind of big bang departure, you would get at least two departures, um, depending on when the northern estate accommodation is ready. What we're now doing with the latest changes to the programme is reconsidering that analysis and what that phased decant would look like. And that would certainly be a very early priority for the phase one works.
So I think the first important point is that 40% of the floor plate of the palace is House of Lords. Our plan is to progress, subject to Parliament's decision, the QE2 programme, and that would allow the House of Lords to decant. That would give a significant footprint within the Palace, assuming we went down this full decant route, and I should probably say it does become a bit easier under the EMI plus scenario from a design perspective, um, in the commons end of the building, um, moving to a phase decant would effectively stage the commons decant, subject to the availability of northern estate accommodation.
So rather than a kind of big bang departure, you would get at least two departures, um, depending on when the northern estate accommodation is ready. What we're now doing with the latest changes to the programme is reconsidering that analysis and what that phased decant would look like. And that would certainly be a very early priority for the phase one works.
10:45
Speaker 7
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Speaker 7
Um it's not a great start is it, to such a major scheme. We're already we're beginning to adjust the timescales to fit in with the temporary accommodation arrangement, which, which we've known for some time was going to have to be delivered. I mean, the reference was made, and I understand the problem about the constrained nature of the site, but the site hasn't just suddenly become constrained, has it?This issue has been talked about for the last ten years.
10:46
Speaker 3
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Speaker 3
So, I mean, I think it is a well understood issue, and it's something that's very high up our list. And we've consistently flagged the risk of that interface. Um, the delivery authority is accountable for the QE2 accommodation. Um that's on track but subject to Parliament getting on and deciding the timetabling of the debates. So the key risk around QE2 is around the debate timing. And very happy to return to the implications of that going late, if that would be helpful.
Um, on the northern estate side, um, what the delivery authority is attempting to do is to proactively, as possible, mitigate what, what is effectively an external dependency for the R&R programme, right?
Um, on the northern estate side, um, what the delivery authority is attempting to do is to proactively, as possible, mitigate what, what is effectively an external dependency for the R&R programme, right?
10:46
Speaker 7
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Speaker 7
So there's two issues there need to get raised. One, the fact that different bodies are now responsible for the programme, and it's never ideal in major contracts, you know, which run on for some years, is it to have a split responsibilities?Um, wouldn't it be ideal to have everything under one responsibility?
10:47
Speaker 2
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Speaker 2
Um so I can, um inform you that the Commons Executive Board meets this afternoon and part of that conversation is around um the Commons building infrastructure portfolio and whether um it should remain as is or move over to R&R delivery and um accountability, but it makes the recommendation that nothing is decided before the debates because we have to have the certainty for what is going ahead with the R&R programme. So again, it's constrained by the debates. There are pros and cons either way. Um we should be clear about whether um anything should change.
Um and you are right to say that um this isn't a new programme. I was just looking at the timeline. Um the programme to refurbish the northern estate was agreed in December 2015 and that programme was closed in November 2020. So this is a, is, is um the work that our colleagues are doing exceptionally hard work on in strategic estates to rebuild a programme and move forward and ensure that the northern estate is, is refurbished in its own right and able to accommodate whatever it needs to from the palace as a result of R&R.
Um and you are right to say that um this isn't a new programme. I was just looking at the timeline. Um the programme to refurbish the northern estate was agreed in December 2015 and that programme was closed in November 2020. So this is a, is, is um the work that our colleagues are doing exceptionally hard work on in strategic estates to rebuild a programme and move forward and ensure that the northern estate is, is refurbished in its own right and able to accommodate whatever it needs to from the palace as a result of R&R.
10:47
10:48
Speaker 2
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Speaker 2
We'll always have to consider that and make sure that we have mitigations in place. This programme um has a lot of contingency built into it. It is a complex programme in its own right to restore the palace. Then you add in the dependencies, then you add in the decision making. It is a complex programme and we're always going to have to consider the potential risks and and slips along the way.
10:48
Speaker 3
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Speaker 3
Yes. And I think part of our strategy is to build the programme in as flexible a way as possible to mitigate what might happen in the future. I don't think it is unusual for a programme of this scale to have a big external dependency. Certainly the last couple of programmes I've worked on have had big external dependencies. Um, I mean, as ever, there's lots of unique characteristics around the way the Parliament works, but I think with good interface management in place, it should be possible to accommodate the two programmes being interdependent in the way that they are.
And that's certainly the way in which we're approaching the problem.
And that's certainly the way in which we're approaching the problem.
10:49
10:49
Speaker 7
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Speaker 7
Okay, we'll probably come back to the governance arrangements in due course, but just on the issue of the temporary accommodation, um, you mentioned that it would be easier to manage it if the um the full decant option wasn't chosen. But you know, more, slightly more challenging if it was, but in either scenario of either two options, will the temporary accommodation still be built to the same standard?
10:49
Speaker 2
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Speaker 2
Yes. So as part of the consultation internally, um I talk about the House of Commons, uh, first, um the uh, presentation to domestic committees up to the House Commission last summer talked about the level of ambition for the for the temporary works and the wider works on the northern estate. And they agreed the level of ambition to achieve all parliamentary standards. Um, they are um set to. Ensure that Parliament can continue to operate as planned. Um and so as I said, you'll be provided, if it's a full decant, you'll be provided with a replica chamber.
Um you will be provided with requisite services that you need to make sure that your jobs are um, as effective as they can be. So in Richmond House, the plan as currently set out provides a replica chamber, galleries and lobbies on a temporary basis. It would be replica, as I said otherwise, it's a space for contingency. It provides um, offices. For, I think, 336 member staff and 167 members. It provides a members tea room. It provides the facilities and services, including procedural services, that you need to do your job.
And at um level, that is, um, supportive and sufficient for running parliamentary proceedings and members doing their job.
Um you will be provided with requisite services that you need to make sure that your jobs are um, as effective as they can be. So in Richmond House, the plan as currently set out provides a replica chamber, galleries and lobbies on a temporary basis. It would be replica, as I said otherwise, it's a space for contingency. It provides um, offices. For, I think, 336 member staff and 167 members. It provides a members tea room. It provides the facilities and services, including procedural services, that you need to do your job.
And at um level, that is, um, supportive and sufficient for running parliamentary proceedings and members doing their job.
10:50
10:51
Speaker 2
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Speaker 2
So that work is ongoing because of all of these programs. They continue to refine, refine their design as they go through the different stages. So, um, it's true to say that the proposal for the temporary chamber as is, has, I think about 30 less seats now. So we've reduced it down and there is work ongoing to see if that can be reduced further. What the replica chamber would provide is much more accessibility. So there'd be a number, a kind of quite significant increase in the number of people who are mobility impaired to be able to, um, kind of operate more effectively within the chamber.
But work is ongoing to try and continue to bear that down. Yeah.
But work is ongoing to try and continue to bear that down. Yeah.
10:51
Speaker 7
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Speaker 7
Just final point, um, recently. The Chair Sarah Olney went to Canada to look at their, uh, work on refurbishing, um, their parliament. Uh, and they've obviously got temporary accommodation in place now. Um, they said to us, it's not just about the services and the functionality. This, this building in the end will be the country's parliament for a period of time, not just a temporary building. It's the parliament. So it's going to be the parliament. Then it has to look like a parliament and feel like a parliament.
As that message got through.
As that message got through.
10:52
Speaker 2
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Speaker 2
That message has definitely got through, and we've only ever been designing for something that is fitting for the home of UK Parliament. We have previously had lots of suggestions put to us, including temporary portacabins. We are not going down that option. We are going to provide something that is fitting for UK Parliament. And so when I say, you know, the ability for members to do their job effectively, that's exactly what I mean. And obviously our core purpose is to make sure parliamentary proceedings can run efficiently and effectively for the benefit of this reassuring.
10:53
Speaker 7
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Speaker 7
You say that it I think it's really important in terms of trying to, um, take. Members along the right path on this that that information indeed some consultation about it is built into the program. I think that's what the Canadians found as well, that the things that most exercise members were not the big contract discussions. It was what what the building actually looked like and how they were going to operate in it.
10:53
Speaker 2
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Speaker 2
Absolutely. And came from a meeting yesterday with the accommodation whips from the three main parties. Um, that's part of the consultation at this stage as we work through the commission, uh, the House of Commons Commission talked about this last month. They're talking about it again on Monday. Once we get through that, we will then start much wider member consultation. And we'll start to show you the designs. Um, being careful to make sure that people don't think we're gold plating things.
We are not trying to gold plate things. We are trying to make sure you have a really effective, um, working home.
We are not trying to gold plate things. We are trying to make sure you have a really effective, um, working home.
10:54
Speaker 2
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Speaker 2
No, that's not true. I mean we are um we are engaged in consultation, in conversation. So um, we are working really collaboratively with the Ministry of Housing, Communities and Local Government facilitated by the Cabinet Office to work out what the terms of any acquisition would be. We have been given access to the QE2. Um but we recognise it is a working establishment. And until such time as houses make a decision on what they want to do, that remains a conference centre operating as it does.
But no, there are not um. Kind of huge um unnecessary amounts of money being spent. We are following due process to understand how to acquire the building in the most efficient and Due process to understand how to acquire the building in the most efficient and effective way for the UK taxpayer.
But no, there are not um. Kind of huge um unnecessary amounts of money being spent. We are following due process to understand how to acquire the building in the most efficient and Due process to understand how to acquire the building in the most efficient and effective way for the UK taxpayer.
10:55
Speaker 1
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Speaker 1
Why is the word acquired always used?I mean, there's plenty of alternatives like leasing it. Acquired implies quite a lot of money and the rumours have been about that. People are talking about 400 million to acquire it. I don't know whether that's true or not and whether you want to comment on that for commercial reasons or not. But it seems a great deal of money.
10:56
Speaker 2
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Speaker 2
So we use acquire because. So we are not looking to lease. And the conversations with Ministry of Housing, Communities and Local Government for quite a long time now has ruled out leasing us. Uh, and so we are looking to acquire, um, and I would imagine that's partly because whatever happens, we need that building for quite a long time. So, uh, the lowest estimate of time used for that building as a temporary, uh, accommodation for the House Lords is about eight years.
So it's a long time. So we're looking to acquire, um, the. Acquisition cost would be nowhere near £400 million. And we've commissioned a red book valuation as part of these conversations. And I think what might be getting confused there is the estimated fit out cost, which as I talked you through the phase one works package, is about £470 million, but the acquisition cost is lower. The conversation about acquisition would also include whether it was better for the UK taxpayer, for us to transfer the building, uh, rather than circulate the money around.
But those conversations are ongoing.
So it's a long time. So we're looking to acquire, um, the. Acquisition cost would be nowhere near £400 million. And we've commissioned a red book valuation as part of these conversations. And I think what might be getting confused there is the estimated fit out cost, which as I talked you through the phase one works package, is about £470 million, but the acquisition cost is lower. The conversation about acquisition would also include whether it was better for the UK taxpayer, for us to transfer the building, uh, rather than circulate the money around.
But those conversations are ongoing.
10:57
Speaker 1
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Speaker 1
However you do it, it's all one pot, basically. Government and parliament. Why has the lease option been ruled out?I mean, it's perfectly possible in a commercial. I'm a commercial man. I understand how these leases work. You simply take a schedule of state and condition at the beginning, a comprehensive one. You lease it for, say, 15 years renewable year to year. And the government would, at the end of it, would have the power to put it back, require you to put it back to how it was or something similar.
10:58
Speaker 2
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Speaker 2
It was a ministerial decision not to offer a lease. Um, and I have said that I presume that is on the basis that parliamentary use would be for a significant amount of time. Um and there is also, I imagine this wasn't part of the consideration of Ministry of Housing, communities and local government, but opportunities for Parliament to use that building in the longer term, particularly from a Commons perspective, to consolidate other, um, office accommodation. We have outside of the estate that you will know.
10:58
Speaker 1
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Speaker 1
Very useful to have that on the the record. Thank you. Charlotte. Um, one question on, on back to, to uh, Richmond house. Um. If this problem with the mod car park can't be resolved, um, I'm just slightly struggling as a commercial person to work out how you're going to do that refurbishment. Can you cite a tower crane on our existing, uh, Norman shore area in which to carry out the refurbishment on Richmond House?How will you do it?
10:59
Speaker 2
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Speaker 2
Um, so I'm no expert in this and I can provide, I can get my colleagues to provide you with a note afterwards. But the alternative that we are looking at, uh, is to use an area for logistics outside on Whitehall, uh, but also to provide welfare accommodation alongside Richmond House on a little strip of land that we own. So there's a bit of a mixed approach, but if you want the details, I can I can get a note.
10:59
11:00
11:00
Speaker 3
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Speaker 3
So the concept of phase one is predicated on an assumption that it will be possible to converge the designs. Um, we took possession of the, as you know, we didn't develop the EMI option, but we took possession of the materials around EMI in February. And we've been going through a process of due diligence to understand those, um, those proposals. And one of the first things we would then do in phase one would be to look at how we could converge those two solutions. I think an important point is that the end state of EMI is the same as the end state.
For full decant. It's just the method in which you get there differs. And we believe that for the first seven years, it should be possible to converge the way you do that so that you get a kind of Common Core, certainly up to 2030, by when we would expect Parliament to have decided exactly which option it wanted to pursue in the longer term.
For full decant. It's just the method in which you get there differs. And we believe that for the first seven years, it should be possible to converge the way you do that so that you get a kind of Common Core, certainly up to 2030, by when we would expect Parliament to have decided exactly which option it wanted to pursue in the longer term.
11:01
11:01
11:01
11:01
11:02
11:02
11:02
Speaker 4
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Speaker 4
Obviously still remains a. My question is to Russ. Sorry. There's obviously remains some uncertainty about obviously both costs and schedules, but that uncertainty is greater with the EMI option. Um. Um, so I wonder if you could just talk us through what are the key assumptions that are underpinning your current cost and schedule estimates for the main works?And how might those assumptions change as the programme progresses?
11:03
Speaker 3
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Speaker 3
Sure. So I guess there's two parts to the answer. I mean, the first is that a granular level, we've got 40 client requirements. There's about 100, um requirements that sit below that are things like standards and, and other things that define the programme. So to some extent, they, they are a set of assumptions. Um, layered above. The, what is that we want to build?I think we've probably touched on sort of three key assumptions at the moment.
One assumption is about when the debates happen. Um, and clearly we don't know. Um, and um we, we had planned for that to be, uh, by the Easter, um, we were then planning for that to be by the summer. Obviously the commons rises in a week. So the window of opportunity for that is, is rising and we go through, we believe, quite a significant inflection point over the summer, where the consequences of not having clarity by that point start to increase.
The second big assumption is around the availability of cbip, and we've obviously spent quite a lot of time, um, talking about that.
One assumption is about when the debates happen. Um, and clearly we don't know. Um, and um we, we had planned for that to be, uh, by the Easter, um, we were then planning for that to be by the summer. Obviously the commons rises in a week. So the window of opportunity for that is, is rising and we go through, we believe, quite a significant inflection point over the summer, where the consequences of not having clarity by that point start to increase.
The second big assumption is around the availability of cbip, and we've obviously spent quite a lot of time, um, talking about that.
11:04
11:04
Speaker 3
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Speaker 3
Of, sorry, the northern estate programme, sorry, the Commons building infrastructure portfolio. Um, and then the third assumption, if you like, which is slightly distinct from a requirement, would be an assumption that the client boards recommendations take forward two options is what we end up doing through phase one. But clearly until Parliament takes a view on that, um, it's, it's difficult to be absolutely clear. So I think they would be the three big variables that I would set out beyond the sight more requirement orientated.
11:04
11:05
11:05
11:05
11:06
Speaker 4
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Speaker 4
So we're due to get the business statement for next week, any minute now, which presumably I think we're not expecting to see a restoration and renewal debate next week, which will mean September 1st, two weeks, sometime in the first at the very earliest. Can you give us a a?A sense of how you think that delay might impact costs, perhaps in percentage terms, or how it will impact the cost?
11:06
Speaker 3
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Speaker 3
Sure. So, um, if we don't get a debate by the summer and we get a debate at some point before the end of the year, um, the, I mean, these indicative estimates, but we've arranged that between 220 and £290 million, including inflation. And the reason for that is, um, because there's two big items on the critical path. One is our ability to progress the QE2 programme, both in terms of the acquisition that Charlotte talked about, but also getting on with the QE2 procurement to get contractors on board to fit it out, but also, importantly, engaging with members of the House of Lords to confirm the design.
Obviously, our design programme is progressing. We need to be absolutely clear that what we're designing meets with our customers expectation and getting that information late in the design process would obviously be very unhelpful. And then the other big item on the critical path is our ability to progress the procurement for the main palace works. Uh, and we feel we're ready to go on that. In fact, we would like to be launching that over the summer, but we feel it wouldn't be a sensible thing to progress until we had absolute clarity on what it is that Parliament wanted to do.
Obviously, our design programme is progressing. We need to be absolutely clear that what we're designing meets with our customers expectation and getting that information late in the design process would obviously be very unhelpful. And then the other big item on the critical path is our ability to progress the procurement for the main palace works. Uh, and we feel we're ready to go on that. In fact, we would like to be launching that over the summer, but we feel it wouldn't be a sensible thing to progress until we had absolute clarity on what it is that Parliament wanted to do.
11:07
11:07
11:07
11:08
Speaker 3
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Speaker 3
Um, so I think the, the main reason well, I mean, I think there's a sort of parliamentary answer to that, um, which is, um. You'd be putting the cart before the horse a little bit and there's an argument that you might be prejudging whatever Parliament might decide, I think from a slightly more technical perspective, um, we're not convinced that supply chain would take a particularly seriously if we tried to launch a major procurement, which had very significant bid costs for the people that we were expecting to interact with that procurement, unless we could demonstrate a really clear signal from Parliament that this was a project, that it wanted to proceed with a normal basis, it wanted to proceed.
So I think they would probably be the two parts to the answer I get, but I don't know whether Charlotte wanted to add to that.
So I think they would probably be the two parts to the answer I get, but I don't know whether Charlotte wanted to add to that.
11:08
11:08
11:08
11:09
11:09
11:09
Speaker 2
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Speaker 2
Catherine?It was just to follow up on that, like, are there. Is there a programme of works that you are maximizing where whatever happens, these things will need to happen?So the principle that renewal and restoration needs to happen is fairly well established. Exactly what and how and when is perhaps less well determined. But there must be a programme of works and procurement and decisions, or at least progress towards decisions that will be inevitable. Whatever is eventually decided that progress could be made on in the interim wouldn't actually determine a particular outcome.
They're going to be needed. Whatever.
They're going to be needed. Whatever.
11:10
11:10
Speaker 2
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Speaker 2
I guess what I'm asking is, is that maximised?There's nothing in addition that could be done that would take phase one forward, even though it's not agreed as part of phase one. But there are inevitable decisions that will need to be made as part of phase two. Or have you maximised all of that in phase one?We've maximised what we can. Um, ultimately we don't. The houses don't have to be asked to proceed with phase one works, but the boards and the clerks, clerk of the House and the clerk of the parliaments are accountable for this, want to and need member buy in and views to be heard, to be able to take this forward.
So we have maximised what we can, I should say, as part of that pre-construction element of phase one works, a significant proportion of that is seeking how we can bear down on costs. Um, but again, it's a bit cyclical because um we will start that, but we need the procurement, the strategic partner procurement procurement partners on board to take that forward. Because as you said, we want to use the expertise of the market to do some of this. So it's a bit circular circular.
But ultimately we need to have the debates because we need to hear what members want. And as Russ said, the market needs to have that certainty as well.
So we have maximised what we can, I should say, as part of that pre-construction element of phase one works, a significant proportion of that is seeking how we can bear down on costs. Um, but again, it's a bit cyclical because um we will start that, but we need the procurement, the strategic partner procurement procurement partners on board to take that forward. Because as you said, we want to use the expertise of the market to do some of this. So it's a bit circular circular.
But ultimately we need to have the debates because we need to hear what members want. And as Russ said, the market needs to have that certainty as well.
11:11
Speaker 1
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Speaker 1
I'm just going to ask one more question and I'm going to have a break. Now. I totally disagree with this, but there is a body of a opinion in the House that doesn't want anything to happen. Can you set out for us pretty starkly what you will be faced with if Parliament doesn't approve one or approve?Basically, this, uh, phase one phase of works.
11:11
Speaker 2
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Speaker 2
An R&R perspective, uh, R&R as a program is established under the 2019 act, the delivery authority established under the 2019 act. Uh, and are here until they finish the works to restore the palace as a whole that is required under the act, restoration of the palace as a whole. Um, uh, um, unless. That primary legislation is changed. So one way or another, we need debates in the houses and we need the houses to make a decision. So that's the stark reality of the R&R world.
We will continue to, uh, kind of spend on this program until such time as members tell us what they want to do with it. Obviously, we will bear down on costs and do whatever we need to do. But just to set that in context, um, I think your wider question was what happens to, to the palace?Um, uh, it says in the report quite clearly we will have an expensive managed decline of the building. Colleagues work tirelessly every day currently in the boiling hot roof spaces, I'm sure trying to sort out all the air conditioning or ventilation that we do have, um, to keep this place running.
It is an increasingly difficult job for colleagues to do that, and it will become more expensive. We can't put a figure on that. We can't put a number on that. And, um, lots of previous talk around catastrophic events that is, um, you know, we have a number of very competent people working across this building, uh, or all our estate. Um, it is unlikely the impact would be significant, obviously, but it is unlikely. What is more likely is attritional risk.
About the kind of ventilation, I think one of your colleagues had a leak into her office this week. Um, when we had last times heatwave, we had significant surface water flooding both in peers lobby and some critical equipment, um, as well as it being quite intolerable to, to work in this building. So it's the attritional risk that will be more difficult. Um and I think the clerks have both been, or certainly the clerk of the House has when been in front of you before, um, said quite clearly that ultimately the decision on, on whether it's safe to allow staff to work in the building is his members can choose to continue to turn up.
We have no authority to prevent Parliament from going ahead. But, um, we would and we would continue to do absolutely everything to make sure this place can continue to run and run safely. But it will be increasingly difficult and more expensive to do so.
We will continue to, uh, kind of spend on this program until such time as members tell us what they want to do with it. Obviously, we will bear down on costs and do whatever we need to do. But just to set that in context, um, I think your wider question was what happens to, to the palace?Um, uh, it says in the report quite clearly we will have an expensive managed decline of the building. Colleagues work tirelessly every day currently in the boiling hot roof spaces, I'm sure trying to sort out all the air conditioning or ventilation that we do have, um, to keep this place running.
It is an increasingly difficult job for colleagues to do that, and it will become more expensive. We can't put a figure on that. We can't put a number on that. And, um, lots of previous talk around catastrophic events that is, um, you know, we have a number of very competent people working across this building, uh, or all our estate. Um, it is unlikely the impact would be significant, obviously, but it is unlikely. What is more likely is attritional risk.
About the kind of ventilation, I think one of your colleagues had a leak into her office this week. Um, when we had last times heatwave, we had significant surface water flooding both in peers lobby and some critical equipment, um, as well as it being quite intolerable to, to work in this building. So it's the attritional risk that will be more difficult. Um and I think the clerks have both been, or certainly the clerk of the House has when been in front of you before, um, said quite clearly that ultimately the decision on, on whether it's safe to allow staff to work in the building is his members can choose to continue to turn up.
We have no authority to prevent Parliament from going ahead. But, um, we would and we would continue to do absolutely everything to make sure this place can continue to run and run safely. But it will be increasingly difficult and more expensive to do so.
11:14
Speaker 1
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Speaker 1
So that's really important to get on the record. What you've just said, um, I'm conscious of the remarks made by Andrew Mako, who was one of the former House of Lords clerks, and he on a Freedom of information request, got quite what I thought was quite an alarming number of health and safety incidents relating to the House of Lords. Now, I think part of the problem that we're in now is that too much of all the proceedings relating to this whole R&R project have been done in private and not fully transparent.
Can I ask you this morning whether you would publish or send us a note and we'll publish a full list of all the health and safety incidents in the last ten years in both houses, because I think that's a very powerful argument for proceeding with this whole project. If there really is a risk to people, all of us, um, in the palace, then I think the public needs to know of that.
Can I ask you this morning whether you would publish or send us a note and we'll publish a full list of all the health and safety incidents in the last ten years in both houses, because I think that's a very powerful argument for proceeding with this whole project. If there really is a risk to people, all of us, um, in the palace, then I think the public needs to know of that.
11:14
Speaker 2
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Speaker 2
I can take that away. It's obviously not, it's not in my bailiwick to, to do that, but I can take away the request and get that fulfilled for you. Um, um, as I said, um, often it's the attritional risk that we're looking at. So it's, it's things failing, some of which might have a health and safety element to them, but otherwise they're around provision of services to the palace itself and keeping it running.
11:15
Speaker 1
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Speaker 1
We really helpful. Thank you. Well I think we'll take a five minute break. It's really more or less 1110. If we can be back here in five minutes. 1115 that would be really good. Please. Thank you. All of you. Um, order. Thank you and welcome back. Thank you to our witnesses. I think. We'll start, please, with Sarah Hall.
11:16
11:16
Speaker 2
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Speaker 2
Um, so I can come in on that. Um our, our governance is complex, but we are a complex programme covering two houses. The act itself. So the 29 acts on R and R sets out the accountabilities and responsibilities and allocates accountability to the clerk of the House and the clerk of the parliaments, um part of their statutory responsibilities are to make strategic decisions about this programme that puts them in an invidious position. But the act goes on to say that members of both houses need to agree the cost of proposals.
So the final way forward for this programme, including its funding envelope. But um, just to be clear, the accountability sits with the clerk of the House and the clerk of the parliaments as corporate officers for the two houses in terms of delivery itself, delivery is through the delivery authority, who are responsible for carrying out those works in line with the requirements of the clerks. So that's how the accountabilities and responsibilities cascade. Both clerks are accounting officers, as you would understand them, to be the principal accounting officers for this programme.
And Ros is the accounting officer for the Delivery Authority. Um spend.
So the final way forward for this programme, including its funding envelope. But um, just to be clear, the accountability sits with the clerk of the House and the clerk of the parliaments as corporate officers for the two houses in terms of delivery itself, delivery is through the delivery authority, who are responsible for carrying out those works in line with the requirements of the clerks. So that's how the accountabilities and responsibilities cascade. Both clerks are accounting officers, as you would understand them, to be the principal accounting officers for this programme.
And Ros is the accounting officer for the Delivery Authority. Um spend.
11:17
11:18
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11:18
Speaker 2
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Speaker 2
Um so in terms of the decision making itself, um the clerks, um as I said, it puts them in an invidious position. They are, they of course have to listen to members to your parliament. It's our Parliament, but you are the elected members. Um and so um our governance um exists to have member led boards who are therefore advising and supporting the clerks and fulfilling their statutory obligations. So the boards and groups structure, as I think I set out before, at the top level, it's what we call the R and R client board.
That's the two House commissions meeting jointly. They then do take those strategic decisions and make recommendations to the houses. It's their report, which is, you know, hopefully going to be debated very soon in the houses. Um, and then they have delegated day to day oversight to the member led R and R Programme Board, which is again um, has members from both houses on it as well as um four independent experts across a range of skills, but all with major programme experience and the clerks because they are accountable sit on both.
Um so the decision making governance sits around the accountabilities as set out in the act.
That's the two House commissions meeting jointly. They then do take those strategic decisions and make recommendations to the houses. It's their report, which is, you know, hopefully going to be debated very soon in the houses. Um, and then they have delegated day to day oversight to the member led R and R Programme Board, which is again um, has members from both houses on it as well as um four independent experts across a range of skills, but all with major programme experience and the clerks because they are accountable sit on both.
Um so the decision making governance sits around the accountabilities as set out in the act.
11:19
11:19
Speaker 2
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Speaker 2
So, um, the, the governance structures that we have in place at the moment were set up to get some strategic decisions from the houses. So effectively get these debates. Um, and it was reset in 2022. The original proposal was that the, um, kind of sponsor function was independent of Parliament. It had members on their board, but it was decided that it was too far away from Parliament, too far away from members that, as I said, under the act, have to make this decision.
So it was brought back in-house. Um and, um, we have, uh, kind of had assurance on our governance structures and we look forward looking to review them, but looking backwards, um, it has been determined that our governance has been appropriate and much better in this current presence. So I get that there are a lot of numbers. Putting together two commissions is a big thing. Um, but it is, it has pros and cons and it's helpful for us to be tied into existing governance structures in two houses.
Okay. Um, in terms of, uh. Accountability. Rest with the individuals. So it's back to the clerks, but the board support, um, the, the clerks in making those strategic decisions. Okay. Thank you.
So it was brought back in-house. Um and, um, we have, uh, kind of had assurance on our governance structures and we look forward looking to review them, but looking backwards, um, it has been determined that our governance has been appropriate and much better in this current presence. So I get that there are a lot of numbers. Putting together two commissions is a big thing. Um, but it is, it has pros and cons and it's helpful for us to be tied into existing governance structures in two houses.
Okay. Um, in terms of, uh. Accountability. Rest with the individuals. So it's back to the clerks, but the board support, um, the, the clerks in making those strategic decisions. Okay. Thank you.
11:21
Speaker 1
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Speaker 1
So, um, this is not maybe a question that you can't answer, Charlotte, but it would be interesting to have a view if you can. Um, it strikes me as slightly incongruous that the clerks who ever since I've been here in the 34 years, it's their primary job is to make sure that Parliament functions properly. They advise on all matters of procedure in relation to Parliament. But there was never a major. Certainly when I first came here, a major part of their work, which was to have the legal responsibility for the maintenance, or let alone a huge R&R project.
And I'm wondering it may need an act of Parliament, I don't know, but I am wondering, given that the project is so large, maybe after phase one, whether a better alternative would be, rather than the clerks having legal responsibility for the whole thing to have one senior. Programme manager calling him or her what you like, who would have legal responsibility and would account to the client board for every aspect of the of the project.
And I'm wondering it may need an act of Parliament, I don't know, but I am wondering, given that the project is so large, maybe after phase one, whether a better alternative would be, rather than the clerks having legal responsibility for the whole thing to have one senior. Programme manager calling him or her what you like, who would have legal responsibility and would account to the client board for every aspect of the of the project.
11:21
Speaker 2
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Speaker 2
Um. So I'm not sure how long you've been in the house. Um, sir Jeffrey for a lot longer than me. I think it was in the 1990s that maintenance of the parliamentary estate came over to Parliament. So before that it was part of the government estate. And so we had a different arrangement. But since then it's been up to Parliament to um to, to maintain the estate. Um in terms of the clerks responsibilities.
Um and I'm sure they'd be better to provide you a note on what their accountabilities and responsibilities are or have been over time. But um, since I've been here, which is about 17 years, their responsibilities have always included the corporate officer responsibility in the accounting officer responsibility. Um, and obviously for their respective houses. And they always work jointly because, um, the palace is conveniently split, whether you're on red carpet or green carpet, but really everything else doesn't really matter what house you're supporting their systems and services that cross, regardless of what color the carpet is in terms of moving forward.
I mean, um, it's obviously something to look at about whether we could have one senior program manager. Um, but ultimately we're still going to need to, um, to kind of connect in and work with the two houses through the clerks. So I'm not sure how it would work. Um, but we can certainly take it away and look at it as part of the governance review. But at the moment, our governance review, which obviously recognizes that if the houses agree to this recommendation for the phase one work package to get momentum and move forward, we start to move in delivery.
So we need to have a bit of a step change in our governance and the agility of our decision making. That current plan, uh, looking forward still seeks for the corporate office to retain the accountability under the act.
Um and I'm sure they'd be better to provide you a note on what their accountabilities and responsibilities are or have been over time. But um, since I've been here, which is about 17 years, their responsibilities have always included the corporate officer responsibility in the accounting officer responsibility. Um, and obviously for their respective houses. And they always work jointly because, um, the palace is conveniently split, whether you're on red carpet or green carpet, but really everything else doesn't really matter what house you're supporting their systems and services that cross, regardless of what color the carpet is in terms of moving forward.
I mean, um, it's obviously something to look at about whether we could have one senior program manager. Um, but ultimately we're still going to need to, um, to kind of connect in and work with the two houses through the clerks. So I'm not sure how it would work. Um, but we can certainly take it away and look at it as part of the governance review. But at the moment, our governance review, which obviously recognizes that if the houses agree to this recommendation for the phase one work package to get momentum and move forward, we start to move in delivery.
So we need to have a bit of a step change in our governance and the agility of our decision making. That current plan, uh, looking forward still seeks for the corporate office to retain the accountability under the act.
11:23
Speaker 1
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Speaker 1
I think the rationale behind my question was it would not be during the phase one, it would be once the vote had taken place in 2030. So we had a settled proposition. Then we're in a different territory. I think we know exactly what we're doing. Uh, and, and like, like governance, which we will come on to in a minute. I think that the governance we have now isn't necessarily the government's we need when we've got into that settled state.
But what I'm going to do is ask the Comptroller and Auditor General to just comment in general terms, how big projects like this are managed elsewhere.
But what I'm going to do is ask the Comptroller and Auditor General to just comment in general terms, how big projects like this are managed elsewhere.
11:24
Speaker 6
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Speaker 6
Also different arrangements depending on size. But for some of the very biggest I mean, the obvious big one is HS2, which this committee scrutinises regularly. They're the. The accounting officer is the chief executive of HS2 limited and the accounting officer for that programme. Obviously accountable themselves to the Department for transport Accounting Officer, which is the Permanent Secretary. So there are there are models which have these nested arrangements that could be adapted.
11:24
11:25
11:25
11:25
11:25
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11:26
Speaker 3
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Speaker 3
So, um, as I think we touched on earlier, EMI is at a lower level of maturity than the other two options in terms of full decant and continued presence. There's a relatively industry standard scale of maturity. Royal Institute of British Architects stages, um, full decant and continued presence is at Riba stage two and EMI is at Riba stage one. What that means is that some of the technical feasibility things that you would resolve during the second stage haven't yet been resolved for EMI, so there's a greater range of uncertainty in that scheme.
That's one of the reasons why there's a much more significant allocation of contingency for EMI. The other reason there's a more significant allocation of contingency is clearly a a more difficult job to do in that way, working around the business of Parliament. So sort of two different reasons why it has much greater levels of contingency.
That's one of the reasons why there's a much more significant allocation of contingency for EMI. The other reason there's a more significant allocation of contingency is clearly a a more difficult job to do in that way, working around the business of Parliament. So sort of two different reasons why it has much greater levels of contingency.
11:27
11:27
Speaker 3
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Speaker 3
So I think what we will know is we will have, we will effectively take all of the designs another stage further forward. We will have submitted to planning. Um, and we will have continued our survey programme. What those three things together will do is well, better, better articulate and understand the key risks as we understand them on the programme. So better understanding of the building, better granularity of the design information which will allow us to put more certain cost and schedule estimates around each option.
So what Parliament will then have would be narrower cost and schedule changes and more certainty. Um. Could you make a decision now?Well, absolutely. But you know, equally you could wait. Both are legitimate choices.
So what Parliament will then have would be narrower cost and schedule changes and more certainty. Um. Could you make a decision now?Well, absolutely. But you know, equally you could wait. Both are legitimate choices.
11:28
11:29
11:29
11:29
11:29
Speaker 2
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Speaker 2
And that's true of the Da. Phase one works is a really pragmatic way to get momentum on this programme. We believe it follows emerging best practice around some of the other programmes that, you know, major mega programmes that are going on that have gone too fast to Ward's construction without fully understanding their risks, which is what Russ was just talking about. So we think it's aligned with emerging best practice and a really pragmatic way, um, to get moving and again, reference the excellent report that says it's a very sensible way forward.
11:30
11:30
11:30
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11:30
Speaker 3
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Speaker 3
And I think it's important to untangle the two things that will be decided in 2030. One thing is the next investment decision, if you like. And as Charlotte said, it would absolutely be best practice to commit to a programme incrementally when you know more. The second thing that will be decided is this option down selection. And I think that's a slightly different decision that you could take now. You could take later. We've been very clear from a delivery perspective that the quicker you can down select, the better, and that there's consequences to keeping options open, but equally completely respect.
That's a choice in a matter for Parliament and understand why why it's been decided to keep those options open.
That's a choice in a matter for Parliament and understand why why it's been decided to keep those options open.
11:31
11:31
11:32
11:32
Speaker 3
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Speaker 3
So we. We plan to let contracts in phase one that would persist through the life of the programme for the design and the programme arrangements. We're considering what the right approach is for the. If you like, the more construction orientated aspect of the programme. Um, and I think once we have greater clarity about what what it is that's in phase one, we will know the answer to that.
11:32
Speaker 1
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Speaker 1
So that's a bit of a how long is a ball of string because you let the design. I'm. Listen to your words carefully. There. We don't know how long that would take before you're then able to let a full contract for the works to start. Can you provide any. I mean, what we're interested in is really. At what point do we see shovels on the ground?Really?I suppose is what I'm asking.
After the vote in 20 2030.
After the vote in 20 2030.
11:33
Speaker 3
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Speaker 3
So. The start of main construction, I think I would define at the point that the first big decant happens in a full decant scenario. So under, um, we talked earlier about the QE two proposition. The aim would be that we complete the QE 2 in 2032. And as a minimum we gain access to 40% of the palace floor plate through the House of Lords departing. Um clearly this is one variable that is quite significantly affected by whether you end up going for an EMI option or a full decant option.
I think in EMI scenario, it's a slightly less acute cliff edge, but if you were to try and attempt to define the start of main construction, I think 2032 would be a sort of sensible place to start, but it's a slightly greyer area.
I think in EMI scenario, it's a slightly less acute cliff edge, but if you were to try and attempt to define the start of main construction, I think 2032 would be a sort of sensible place to start, but it's a slightly greyer area.
11:34
11:34
Speaker 3
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Speaker 3
Yes, because we we expect to have run the procurement activity during phase one. We're not seeking to price the job up front. We're seeking to bring in a long term partner that will work with us through the job and as and when individual packages of work have been developed to an appropriate level of maturity. We would pass those packages to our sort of pre-selected supplier or suppliers. And, um, we'd be ready to do that when we exited phase one.
11:35
11:35
Speaker 3
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Speaker 3
So um. Part of the reason why I'm hesitating, my answer is because what we want to do first is bring bring on our programme partner as quickly as possible and work with our programme partners to develop exactly the strategy that you've laid out. I think it's also very difficult to settle a firm commercial strategy until you know exactly what it is that Parliament's decided to do. So we've got a number of variables, not least the need for some debates and some clarity about what the job is.
Once we've settled the answers to those variables, then we can kind of revisit our commercial strategy and confirm it.
Once we've settled the answers to those variables, then we can kind of revisit our commercial strategy and confirm it.
11:35
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11:36
Speaker 5
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Speaker 5
Office report recommends that governance arrangements are reviewed. Um. And, you know, bearing in mind that we've already touched on some of the ongoing discussion around this, um, my understanding is these governance arrangements ideally should be reviewed before phase one starts. Um, but, uh, do these not need to be looked at as part of the decision that Parliament needs to take?Because obviously that will be the framework within which Parliament will decide what it wants to happen. Because how those how that delivery will be governed, I think, will be of interest to parliamentarians.
So I think somebody used the phrase, we're a bit cart before horse. Um, is. There not a risk that we're in that situation with the governance arrangements that we need to be clear on what they are before a decision can be made. Um, handing over. Delivery.
So I think somebody used the phrase, we're a bit cart before horse. Um, is. There not a risk that we're in that situation with the governance arrangements that we need to be clear on what they are before a decision can be made. Um, handing over. Delivery.
11:37
Speaker 2
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Speaker 2
So I suppose um it's natural for any major program and any major programme should look at the governance model over the different phases of the programme. So we are just doing what um what we should be doing. Um we set up the governance for this strategic decision making stage. Um the cost of proposals report says that we will undertake a governance review that has started, but the client board's view is that it needs to hear, um the decision from the houses as to which way it wants to take the programme before we confirm what those changes are.
Um, they can you.
Um, they can you.
11:38
11:38
Speaker 2
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Speaker 2
Knows that um we are predicating our, so we are looking at the governance review in light of the recommendations. And the recommendations are that we move forward with this phase one works. Um, and then we have a decision, um, another strategic decision in 2030. So the governance, um, kind of context in phase one is a mix of delivery and continuing strategic decisions. So we've got to get the balance right between getting timely decisions for us and the delivery side to move on, which means decisions at the lowest level with clear escalation routes and thresholds, alongside the need to make sure that we have high levels of member engagement and involvement, because those strategic decisions are coming back down the line.
So that's the balance of it. Um, if the houses decide not to do that and to move straight forward and take the full decision, now, that's a very different prospect. That's jumping straight into delivery, which means that we would need to look again. And what we're proposing. So the the review is currently predicated on what is recommended. And why wouldn't it. But the houses need to have their views, you know, emotions in both houses will be amendable.
We really need to understand and then we'll build on it.
So that's the balance of it. Um, if the houses decide not to do that and to move straight forward and take the full decision, now, that's a very different prospect. That's jumping straight into delivery, which means that we would need to look again. And what we're proposing. So the the review is currently predicated on what is recommended. And why wouldn't it. But the houses need to have their views, you know, emotions in both houses will be amendable.
We really need to understand and then we'll build on it.
11:39
11:40
Speaker 2
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Speaker 2
Yes. And and to move very quickly into that new. So it's not it's not that we're going to spend seven years navel gazing. We need to get on with it. But we need to kind of really understand what the houses are going to tell us. The direction is, um, broadly speaking, we had an independent advice and assurance panel advise around what the governance should look like in this next stage, um, recommending phase one works. Um, they saw um a lot of good in what we currently have and they have recommended a kind of evolution of the three tier model that we have already.
So again, using the two commissions to work together as the client board. And one thing I would say and official is absolutely essential that we retain bicameral governance for this programme. And that's something that our Canadian counterparts struggled with at the beginning. So it's critical that we manage that. And there are huge benefits in us linking into the existing governance of the two houses, as I said earlier. So at that level, recognising that um members at that level don't have the time to get into the detail to continue with a programme board that would provide oversight and scrutiny of the detail, and then a consolidated official level group, which I think I discussed about having the senior officials involved in R and R and the business as usual programmes to make sure that we've got a more um.
Agile group informed with a refined integrated schedule and with the correct delegated authority to make decisions at the lowest level that will facilitate that kind of delivery decision tempo that we need critical to that is working out what the escalation thresholds are, because ultimately, we need to make sure that there are no surprises for members and members are involved where they need to be involved in those in those decisions. But all of that needs to be worked through.
So again, using the two commissions to work together as the client board. And one thing I would say and official is absolutely essential that we retain bicameral governance for this programme. And that's something that our Canadian counterparts struggled with at the beginning. So it's critical that we manage that. And there are huge benefits in us linking into the existing governance of the two houses, as I said earlier. So at that level, recognising that um members at that level don't have the time to get into the detail to continue with a programme board that would provide oversight and scrutiny of the detail, and then a consolidated official level group, which I think I discussed about having the senior officials involved in R and R and the business as usual programmes to make sure that we've got a more um.
Agile group informed with a refined integrated schedule and with the correct delegated authority to make decisions at the lowest level that will facilitate that kind of delivery decision tempo that we need critical to that is working out what the escalation thresholds are, because ultimately, we need to make sure that there are no surprises for members and members are involved where they need to be involved in those in those decisions. But all of that needs to be worked through.
11:41
Speaker 5
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Speaker 5
Um, it does feel like we're just delaying some of the more difficult aspects of this. Um, and, and if there runs a risk that the next seven years then turns into longer because we're just putting off, um, some of, I don't really understand why we have to sort of spend the next seven years deciding on the governance arrangements. If there's a sense that we're.
11:41
11:42
11:42
11:42
11:42
Speaker 2
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Speaker 2
As soon as we get the debates, we confirm back to the client board the recommendations for the for the governance in in the next phase. So within the next, if we had if we had debates before the house rises, um, next week. Yes. If we had the debates next week. If then um we would be working to refine that over the summer recess to come straight back to the client board to get that agreed and move forward.
11:43
Speaker 5
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Speaker 5
What's to stop that happening now though?It feels almost like. So I'll tell you how it feels in terms of we're being like, Parliament would be asked to debate and then vote on yes, let's have phase one. And then immediately on making that decision. All of a sudden there's another there's a change in effect and a change proposal in terms of the governance arrangements. And why wouldn't you just combine the two?Because I think the challenge for Parliament is you'll be asking us to make a decision about a programme of works, knowing that the governance arrangements for it need to change.
So why wouldn't we do both at once?I don't really understand that. Um.
So why wouldn't we do both at once?I don't really understand that. Um.
11:44
Speaker 2
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Speaker 2
Um, so I mean, I can just tell you the conversations that have been had at the client board and the recommendation that we've had that those won't be confirmed until after the debate. If it assures you the governance are an evolution, not revolution. And that's phase one works is an evolution, as I've described as we would move into phase two, the main works, we would be in full delivery mode and we would need to reconsider the governance arrangements. But as I've said, as we move into phase one, we are moving into delivery.
We also retain the strategic decision making. It's an evolution, not sorry.
We also retain the strategic decision making. It's an evolution, not sorry.
11:44
11:44
11:45
11:45
Speaker 2
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Speaker 2
So as we move into main works and full on delivery, we will be back with different governance arrangements because in a major programme cycle there are different phases and your governance should suit the different phases that you're at. We've been in policy stage for a long time, and that's what our governance is set up to deliver. We'll move in eventually to full on delivery, which we call phase two. Under the act. Phase one is, um, essentially moving into delivery, but also retaining an element of decision making in the houses.
11:46
11:46
11:46
Speaker 2
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Speaker 2
So, um, again, at an official level, uh, as. I said, consolidating trade off decisions to kind of the senior leaders, myself. Russ managing director of strategic Estates and the two house sponsors for the temporary accommodation, we would be looking to look at those trade offs and make decisions. We need to have very clear accounted, uh. You know, delegation levels. So we have a clarity on when we would need to escalate up to the clerks and then on to the member boards.
11:46
11:47
Speaker 2
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Speaker 2
Uh, so I have a version of that group. It would be resetting that group. Uh, and we have all the underlying support mechanisms. So we have an integrated schedule. We have mapped dependencies. We have, um, a risk and issue logs. We have all the underlying information. Uh, it's just resetting to make sure that we have.
11:47
11:47
11:48
11:48
11:48
11:48
Speaker 2
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Speaker 2
And we're looking at the optimum we're looking to optimize the governance. And I said going into this phase one works, we're looking at an evolution. Um, we are working on the basis that um, as set out in the act, the clerks will continue to be accountable for this program. Um, and there will continue to be opportunities for members to be engaged with that. Um, when we come back to move into full delivery phase two, we will be, the clerks will be required to come back to the houses with a proposal that houses need to agree again.
11:49
11:49
11:49
11:49
11:50
Speaker 5
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Speaker 5
I think you've done what you've done very well. You can in the circumstances, I guess my my challenge would be. And it's not necessarily to you, um, is that if you're asking that, I think the maximum transparency at every stage of asking members to make decisions is advisable. Because I think if you're, if you're saying, now we want you to decide to let us do phase one. But don't worry, we're going to clarify some things some way down the line for you.
I think that's where we have the decision. Every time you ask members to make a decision. But there are some variables to decide on.
I think that's where we have the decision. Every time you ask members to make a decision. But there are some variables to decide on.
11:50
Speaker 1
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Speaker 1
That makes it quite clear how it's going to work. And when we get to 2030 and we'll be in a much more settled state, because the House will have given the Parliament will have given the officials everybody an instruction. At that point, we will have decided what the new government's arrangement should be. And I largely agree with pretty nearly all of what you've said. I've got 1 or 2 sort of refinements to it. The first thing is, I totally agree with you.
We need this bicameral governance. I think that is absolutely critical. So the current board is absolutely critical. The only refinement of that is I would have it chaired by a supremo that's going to be the supremo for the project. They're going to be the one promoting the benefits of the project. And a really senior well known figure, like an ex prime minister or somebody to do that job. Second thing is that I think that Parliament's got to get into a different mindset after that vote in 2030.
It's going to happen. Um, and therefore they've got to get into the mindset of being the client, not the deliverer. You people are responsible for delivery. They've given you an instruction. You must get on with it. They can't be there watching them put every brick or dig every. Shovel full of earth all day long, every day. They just simply can't do that. So I do think the present governance will need to alter.
I have no doubt about that. And I would suggest that below the client board you have a new select committee. A joint select committee of both houses. I think part of the present problem with this project is that too much has been done in secret and not involving the public, and I think that select committee would do precisely what we're doing now. Have have sessions in public. They would be able to put questions to that select committee and the witnesses.
So there you are. That's a few ideas.
We need this bicameral governance. I think that is absolutely critical. So the current board is absolutely critical. The only refinement of that is I would have it chaired by a supremo that's going to be the supremo for the project. They're going to be the one promoting the benefits of the project. And a really senior well known figure, like an ex prime minister or somebody to do that job. Second thing is that I think that Parliament's got to get into a different mindset after that vote in 2030.
It's going to happen. Um, and therefore they've got to get into the mindset of being the client, not the deliverer. You people are responsible for delivery. They've given you an instruction. You must get on with it. They can't be there watching them put every brick or dig every. Shovel full of earth all day long, every day. They just simply can't do that. So I do think the present governance will need to alter.
I have no doubt about that. And I would suggest that below the client board you have a new select committee. A joint select committee of both houses. I think part of the present problem with this project is that too much has been done in secret and not involving the public, and I think that select committee would do precisely what we're doing now. Have have sessions in public. They would be able to put questions to that select committee and the witnesses.
So there you are. That's a few ideas.
11:53
Speaker 2
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Speaker 2
really helpful. And I and if I can kind of, um, just explain what I mean. So as we move into phase one, it's evolution of the governance as we move into phase two, it's revolution. So more kind of what you've described, that's where we're looking because we move full on into delivery. And of course, the delivery authority need that absolute clarity, timely decisions to bang on and deliver whatever the houses tell us to deliver.
11:54
Speaker 1
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Speaker 1
And then in order to give you a bit of, um, challenge, I do think it's important that whatever, whether it's the present, I or whatever the initial stand for, but I think you need a team of outside experts to keep challenging you on the delivery. So I think there's three phases of the client, whatever comes below that. And then the challenge board as well. Thank you. So that's that's how I would see it. Um, moving on please. Uh.
Catherine, did you have you she's got it's all over the. Place this morning. Um, um.
Catherine, did you have you she's got it's all over the. Place this morning. Um, um.
11:55
11:55
11:55
11:56
Speaker 2
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Speaker 2
I can talk about the kind of robustness of it. And I don't know if you want to come in after us in terms of the robustness we did have those costs assured, um, by the independent insurance panel who thought we were actually underestimating, but we were very clear to be as robust as we could be in presenting those to the houses. But Russ, do you want to talk to the detail?
11:56
Speaker 3
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Speaker 3
Yes, I think it is robust, but I think it's also indicative. I mean, it's very hard to answer a hypothetical question as to what would a year on the um. End of the programme actually end up costing you. Because when does that year land and under what sort of circumstance. So I think I would see it as a rule of thumb that is useful for the purposes of scenario planning. So it allows us to test certain scenarios like the debates, um being late or test certain scenarios.
Um, in terms of different risks materialising. It's something we've triangulated from lots of different sources. As Charlotte said, we've had independent people look at it and confirm that it's, it's reasonable, but I think it is a tool for scenario planning rather. Majority of the cost is inflation. And then there's obviously an overhead to running the programme. And if the programme runs on for longer, you've got a delivery authority to run. You've got a client team to run.
You're injecting additional risks into the programme because of the ambiguities that you put into the next phase. It's those sorts of items.
Um, in terms of different risks materialising. It's something we've triangulated from lots of different sources. As Charlotte said, we've had independent people look at it and confirm that it's, it's reasonable, but I think it is a tool for scenario planning rather. Majority of the cost is inflation. And then there's obviously an overhead to running the programme. And if the programme runs on for longer, you've got a delivery authority to run. You've got a client team to run.
You're injecting additional risks into the programme because of the ambiguities that you put into the next phase. It's those sorts of items.
11:57
11:58
11:58
Speaker 3
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Speaker 3
So we are nervous about supply chain appetite. This is obviously a program as we've reflected on elsewhere, that has had a series of false starts. And um we are keen to get going. We're ready to get going. It's a risk that's quite hard to quantify. Um, what we've said is that we can hold the schedule, um that we've set out, albeit with some cost consequences associated with that. If we get debates about the summer, that feels unlikely to happen, there's then a kind of period, uh, beyond.
There's then another crunch point around the turn of the year, um, where, um, again, there's a sort of uptick in the scale of the consequences. If we haven't got decisions by then.
There's then another crunch point around the turn of the year, um, where, um, again, there's a sort of uptick in the scale of the consequences. If we haven't got decisions by then.
11:59
11:59
Speaker 1
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Speaker 1
Thank you. Sarah. Uh, can I commend again to you to, to, to run until you get the vote in 2030 with more than one supplier and, and, and including the vote, um, who the suppliers are and what they've quoted. So the whole thing is fully open. I think. So, um, that's more of a sort of statement than a question. It's probably something you need to think about. Um, I think, I think we've covered a lot of ground today.
Um, one of the other things that occurs to me in your evidence is that you might need to change the act. Can you explain under what circumstances you might need to change the act?Because it does seem to me that the act is actually quite good. It was quite far sighted in what it did way back in 2019.
Um, one of the other things that occurs to me in your evidence is that you might need to change the act. Can you explain under what circumstances you might need to change the act?Because it does seem to me that the act is actually quite good. It was quite far sighted in what it did way back in 2019.
12:00
Speaker 2
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Speaker 2
Um, so the, uh, I think, I think it's the cost of proposals report does indicate that, uh, the client board foresee that there might be a need to change the act. Uh, but, um, we haven't done any specific work around that on the basis as, uh, on the basis that we really do need to understand what the direction of the houses is until we would consider any of those changes, because it would be through primary legislation. Um, there are a number of reasons that the act could be changed.
Um, we've talked about governance and accountabilities. If the accountabilities were to change, the act would need to be changed. Uh, the act sets out, um, who, the, who will be delivering the works. If that was to change, the act would need to change. Um, the, uh, phase one. Phase two arrangements are set out in the act. So what work?The, uh, phase one. Phase two arrangements are set out in the act.
So what work can be undertaken until such time as as the houses make a decision, um, that um. Is we're obviously recommending phase one works to go forward with any more phasing within the programme would require the act to change, because at the moment the houses are there to agree. The full package of works under one funding envelope. So if, if the houses wish to look at it in a more of a packaged way, that would need the act to change as well.
Um, we've talked about governance and accountabilities. If the accountabilities were to change, the act would need to be changed. Uh, the act sets out, um, who, the, who will be delivering the works. If that was to change, the act would need to change. Um, the, uh, phase one. Phase two arrangements are set out in the act. So what work?The, uh, phase one. Phase two arrangements are set out in the act.
So what work can be undertaken until such time as as the houses make a decision, um, that um. Is we're obviously recommending phase one works to go forward with any more phasing within the programme would require the act to change, because at the moment the houses are there to agree. The full package of works under one funding envelope. So if, if the houses wish to look at it in a more of a packaged way, that would need the act to change as well.
12:02
12:02
12:03
12:03
12:03
Speaker 4
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Speaker 4
But we would obviously have to go through the parliamentary processes and primary legislation, and the government would need to find time for that. So absolutely, there is an element of time required to do that. It's not currently on the critical path. Um, uh, um, and, um, and we'd have to understand exactly what the changes were required to work out how difficult or easy that would be.
12:03
Speaker 1
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Speaker 1
So final question from me. You'll be glad to know. More. I think there is a feeling that, you know, these numbers, the costs are vast. In. And I know you've got a range and I know you're going to need to conduct dialogue with the contractors. Numbers rather than something that's just on the back of an envelope.
09:42
Speaker 4
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Speaker 4
We have, uh, we have engagement plans ready that are scalable depending on. Recognise that the shadow leader has asked for at least two weeks. So they're scalable from two weeks up to three months, whatever it is. Um, and so there'll be a range of activities within that. We will continue with our current offering. We have just written to all members in both houses that have yet to engage with the proposal. The report all members have received communication.
We talk in terms of engagement, real engagement, two way engagement. Um, and we'll continue with our tours and our briefings. Um, and. And make sure that they have the information they need. Um, we have been busy listening to views of members about the things that they need more information on this committee. On the phase one works. And we've also got one on, on the kind of scope. So the outcome level, what will be delivered in the palace in end state.
And the client board published a much more detailed. Um. And keep pushing that message.
We talk in terms of engagement, real engagement, two way engagement. Um, and we'll continue with our tours and our briefings. Um, and. And make sure that they have the information they need. Um, we have been busy listening to views of members about the things that they need more information on this committee. On the phase one works. And we've also got one on, on the kind of scope. So the outcome level, what will be delivered in the palace in end state.
And the client board published a much more detailed. Um. And keep pushing that message.
09:42
09:43
09:43
Speaker 5
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Speaker 5
No, absolutely. And I mean, I think the first thing to say is I recognise they are very large numbers, but we believe there isn't a low cost way of doing that and happy to return to that, if that would be helpful. A very significant proportion of the numbers does relate to inflation and risk. But if you take that out. I mean, the first is just the complexity of the building. I mean, I'm sure you've heard these statistics before.
It's very big, 1100 rooms, 4000 windows. ET cetera. ET cetera. ET cetera. We're obviously trying to do the work around a busy working parliament, even under a full decant scenario, the period of decant is, um, only a proportion of the length of the overall programme. So either side of a decant, you're still working around Parliament. And clearly it's a building where it's sharing all of the same power water heating systems. So complexity would be the first factor.
The second factor I think would be just the volume of work involved. We think certainly under the decant scenario at peak construction, you might be touching 4000 roles. Some of those are very specialist roles. Some of those are shift working roles. So that's a significant factor that relates to. As he dwelt previously on the heritage context, grade one listed Unesco World Heritage Site. Very limited logistics access, um, parts of the building very, very old. And we're working to replace a set of systems that are often life expired and haven't really been touched for 75 years.
When you add those three things up, you get to the scale of the programme that we're talking about. We've also benchmarked the programme against other projects, and we're comfortable that it benchmarks well in that context.
It's very big, 1100 rooms, 4000 windows. ET cetera. ET cetera. ET cetera. We're obviously trying to do the work around a busy working parliament, even under a full decant scenario, the period of decant is, um, only a proportion of the length of the overall programme. So either side of a decant, you're still working around Parliament. And clearly it's a building where it's sharing all of the same power water heating systems. So complexity would be the first factor.
The second factor I think would be just the volume of work involved. We think certainly under the decant scenario at peak construction, you might be touching 4000 roles. Some of those are very specialist roles. Some of those are shift working roles. So that's a significant factor that relates to. As he dwelt previously on the heritage context, grade one listed Unesco World Heritage Site. Very limited logistics access, um, parts of the building very, very old. And we're working to replace a set of systems that are often life expired and haven't really been touched for 75 years.
When you add those three things up, you get to the scale of the programme that we're talking about. We've also benchmarked the programme against other projects, and we're comfortable that it benchmarks well in that context.
09:43
09:43
09:43
Speaker 4
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Speaker 4
I mean, I can do we've had independent assurance both on the underpinning assumptions of the costs, but also the costs themselves. Um, and above that kind of across the whole with our normal independent advice and assurance panel. So we've had quite a lot of assurance on that. And if I may as well as put on that as well as costs, there are opportunities of this programme. So there's. That might help put this into context is if you look at the proportion of spend for the palace, construction costs 85% of the.
Spend, about 85% of the spend is around what we call the priority areas that the house is set in 2022. So fire safety, mechanical, electrical systems, asbestos and fabric conservation. So it's the remainder that are in the elements that we call areas to have regard to. And that's because the act asks us to have regard to a number of areas. Um and so the cost for those include about 3% of the palace construction costs for security, 5 to 8 accessibility, less than 1% visitor facilities, uh, about, uh, 2% education facilities.
So it's a small proportion. Um, and, um, and in terms of the level of ambition of our works, and I think this is recorded in the Nao report as well. Um, the board agreed an outcome level for reasonably ambitious. If we were to go down to outcome level three. So one down or one up, there's a difference about 5% either way. So hopefully that puts it into context. But undeniably these costs are huge. Part of the phase one works is trying to bear down on those costs, looking at opportunities.
And we've started to categorise high, medium and low. We'll be working through those with the boards. Um, we can't take away that this is undeniably large sums that we're talking about, but the information is there to support it. It's been assured and we will continue to bear down on costs as we move forward.
Spend, about 85% of the spend is around what we call the priority areas that the house is set in 2022. So fire safety, mechanical, electrical systems, asbestos and fabric conservation. So it's the remainder that are in the elements that we call areas to have regard to. And that's because the act asks us to have regard to a number of areas. Um and so the cost for those include about 3% of the palace construction costs for security, 5 to 8 accessibility, less than 1% visitor facilities, uh, about, uh, 2% education facilities.
So it's a small proportion. Um, and, um, and in terms of the level of ambition of our works, and I think this is recorded in the Nao report as well. Um, the board agreed an outcome level for reasonably ambitious. If we were to go down to outcome level three. So one down or one up, there's a difference about 5% either way. So hopefully that puts it into context. But undeniably these costs are huge. Part of the phase one works is trying to bear down on those costs, looking at opportunities.
And we've started to categorise high, medium and low. We'll be working through those with the boards. Um, we can't take away that this is undeniably large sums that we're talking about, but the information is there to support it. It's been assured and we will continue to bear down on costs as we move forward.
09:43
Speaker 1
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Speaker 1
Can I thank you both very much. I think this has been a very constructive session. We've learnt a lot. You've given us a lot of information and I think that's going to be really helpful towards the debate when it comes in the autumn. So thank you. Um and um we may if we've got other questions, um perhaps contact you before the autumn. But in the meanwhile, uh, thank you very much indeed. We will now consider what action we want to take.
I don't mean that as any threat. Whether we're going to produce a letter or report or whatever. Uh, to circulate to members of Parliament and, uh. Please keep working on it as hard as you can during the summer. Order, order.
I don't mean that as any threat. Whether we're going to produce a letter or report or whatever. Uh, to circulate to members of Parliament and, uh. Please keep working on it as hard as you can during the summer. Order, order.