Subject to providing two working days' notice, a Member of the Committee may ask the Chairman of the Committee a question on any matter in relation to which the Council has powers or duties which affect the Tendring District and which falls within the terms of reference of the Committee.
Minutes:
Pursuant to the provisions of Council Procedure Rule 38 Councillor Griffiths asked the following question:-
“I read with interest the recent decision regarding the Jaywick Market Site. I note from the officer report that the original cost for the project in October 2021 was £2.1 million, two months later in December 2021, the project cost had risen to £4.4 million . I am concerned that the projected costing mechanism used for the Jaywick Market site does not appear to accurately reflect the cost of the build.
Would it be possible to outline the reasons why the project cost appeared to significantly increase over a two month period. TDC is a key player in the Garden City Community, actively seeking to encourage the creation of a Freeport, and a key player in the development of the much smaller Honeycroft scheme.
All these projects have projected costings associated with the construction and development of the sites, and some elements of financial contributions from TDC to cover aspects of the work.
Given the project cost increases at the Jaywick site, what assurances do we have that mechanisms are in place to keep costs at the Freeport, Garden City Community and Honey croft under control, as there must be concerns that if our current financial model is unable to accurately predict the cost of a small industrial unit in Jaywick over a relatively small period of time, then a similar situation could occur with Honey croft, The Garden City Community and the Freeport, in which the projected costs are significantly lower than the actual cost of the build”.
The Chairman, Councillor Scott, responded as follows:-
“On the Jaywick Sands Workspace and covered market, the costings were developed for the original Get Britain Building bid in the summer of 2020. There was a subsequent review of the building design which increased some costs (in the region of £300,000) in relation to increasing the number of business units. So the cost base work was originally from 2020, and developed by our cost consultants. We reported to Cabinet in October 2021 that cost inflation was a significant risk on the project. We would only see the actual costs once tenders were received in December 2021. The scale of cost increases was unexpected – although all three tenders came in within c.7% of each other, showing that it was the reasonable market price at the time for the scheme.
On capital projects, the Council is aware that until tenders come in, we only have cost estimates for a scheme, not firm prices. We do not expect to see the exceptional increase in costs for the Jaywick Workspace project again and we will continue to monitor the market and work closely with our cost advisors on future projects. In addition, on the Freeport and Garden Communities: these are under development primarily by the private sector, so the main delivery of the schemes is not a cost risk to TDC; and they operate at a different scale to the Jaywick Workspace project. Cost inflation is less of a pressure on large schemes than small – as the economies of scale are much greater and firms will prioritise working on them”.