MPs blast council for ocean centre cost

March 13, 1998

IN A STORMY session last week, the House of Commons' Public Accounts Committee demanded answers to what one MP called the "mess" surrounding the Southampton Oceanography Centre.

The centre opened two years behind schedule in 1995. The final bill to the taxpayer is still not known but could be Pounds 15 million over budget. The committee did not hold back when it came to expressing its displeasure or apportioning blame.

In 1988, the Natural Environment Research Council was given the go-ahead to merge its Institute of Oceanographic Sciences with its Research Vessel Services in a new world class centre for oceanography research and teaching at Southampton. Seven years later the Southampton Oceanography Centre opened, but an ongoing dispute between NERC and contractors Wimpey means the eventual construction cost could be anything between Pounds 51.6 million and Pounds 64.2 million, despite an original budget of Pounds 48.9 million.

The project was finished 22 months behind schedule, incurring double the proposed consultants' fees and a legal bill that has already topped Pounds 50,000.

Wimpey is in a legal dispute with another contractor involved in the centre. If Wimpey loses it may file a claim against NERC.

John Krebs, NERC's chief executive who was not on council at the time of the build, emerged sheepishly from the committee after two hours, muttering about a stiff drink. One MP wanted to know whether NERC considered itself "parasitic" on the tax payer, another asked what was going on in the council in the early 1990s to "allow this mess to happen". NERC was accused of "being out of its depth" and full of "academics with heads in the clouds".

The evidence used to condemn NERC's then management practice was collated as part of a National Audit Office report last month.

The focus of the MPs' attack was the fact that no independent project manager was appointed by NERC to oversee the project, by far the largest capital investment made by the council at that time. The lack of a project manager meant there was no one independent, with building expertise, who could take responsibility for completion on schedule and the budget. It also meant that the council was slow to respond to delays. Instead, a network of committees ran the project collectively.

Alan Campbell, MP for Tynemouth, said: "Time and time again you were getting advice ... how it would be beneficial to have a project manager. But the council persistently and consistently rejected that advice. Even if you had paid Pounds 225,000 for a project manager it would have been value for money, would it not?" Other areas of management and procedure were also attacked.

The committee wanted to know how only architects who had previously worked for NERC on smaller projects were invited to bid for the contract, how only one design had been properly developed and then considered by council, and how no regular monitoring of design fees, which doubled to Pounds 8.6 million, was introduced until five years after the start.

They also wanted to know how the architects could issue, once construction had begun, more than 1,900 instructions to the contractor, adding almost Pounds 1.5 million to the cost of the project, with only 260 having gone through the correct control channels. Charles Wardle, MP for Bexhill and Battle, said: "I put it to you that it was because they knew the only people vetting this were your council."

The committee also queried why the briefing, design and tender process lasted 15 months longer than planned. Professor Krebs said this was partly because it took longer than expected to bring together money from NERC and Southampton University, the other partner in the project.

The committee also asked why the cost of relocating staff from NERC's research vessel service at Barry in South Wales and the Institute of Oceanographic Sciences at Wormley in Surrey - a key benefit of the new centre - was not included in the original costings. This added over Pounds 4 million, about Pounds 20,000 a head.

To almost every attack Professor Krebs assured the committee things were now done differently. He said NERC accepted all the recommendations in the NAO report and told the committee that despite cuts in the initial design the result was a world-class centre.

But he could offer little insight into how the situation developed in the first place.

Maria Eagle, MP for Liverpool Garston, was not impressed. "There's nothing like getting your fingers burned to stay away from the fire," she said, adding: "It's an expensive lesson."

If Wimpey does take legal action to recover money from NERC, this could be just the beginning of the questioning.

Professor Krebs may find himself, as the committee suggested, "squirming at a very embarrassing situation", a few more times before the oceanography centre controversy blows over.

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