Why did the cost of the Scottish parliament rise from £40m to more than £400m? Simple. Builders were asked to start work before the designs had been settled
The Scottish Parliament building gleams in the morning sun; I gawp. I love it. The light flashes across the aluminium windows interrupted only by vertical stripes of bamboo look-a-like. A woman walks by and mutters; £431m for that load of rubbish. Her accent was distinct, local. Originally, it was to have cost £40m. Completion was July 2001. Come April 2000 the cost forecast was £195m. Mind you, that leap was because parliament decided the intended building was too small. So they ordered it to be built half as big again. Completion was due December 2002. Come June 2001 parliament removed the £195 forecast-cap from their lips. Come June last year the forecast was £375m. Come May this year £431m. It will be finished soon, honest. The Queen is coming.
Rows? Oh yes. Inquiries and blame games? Oh yes. Regrets? Just a few. Lessons? You bet.
The auditor general for Scotland has just reported to parliament about the performance of the building operation. In September, law lord Lord Fraser will report on the whole experience. Meanwhile, the auditor general pokes his finger in the eye of the “form of contracting”. He is not impressed with construction management. He says: it is unsuited for most public sector projects. When Lord Fraser reports in September could he kindly take that remark “on appeal”?
What the auditor really meant was that in future he would prefer some hapless building contractor to take the strain when a major project like this runs wild. Construction management has no main contractor. Instead, it has works packages, a middle manager and the employer who pays the works contractors direct. In other words construction management puts the employer in the same murky water as all the others, instead of him standing on a dry bit laughing at the rest up to their necks in disputes. There is nothing wrong with construction management, Mr Auditor.
The throwaway line in the story so far is that the employer ordered the building to grow by half its size again. Does the auditor realise the mayhem that kind of decision causes on a live site? Poor start, Mr Auditor. And then from June 2001, the trouble starts all over again. The auditor is miffed because newspapers began reporting that the employer “was changing its requirements”. No we weren’t, he protests, “The construction costs initiated by the client amount to £600,000” a fraction, of the £431m. So where has all the money gone? It’s not “changes”, it’s design development, instead. Well now let me tell you that whatever is meant by design development, there is a surefire certainty sitting hot on its tail. It is this: if you are designing and developing design on the hoof and the blokes doing the put-uppering on site are waiting to be spoonfed the information there will be massive upset, massive disruption, loss of productivity and money. Worse still, you get a fed-up site. And be clear about this, the builder of the edifice regards “design development” as changes by the employer. So if the local newspaper asks a chippie why he is fed-up, he will say: it’s the employer who keeps changing his mind. No, no says the auditor general, it’s “design development”. And he bitterly regrets not dumping that mess in the lap of someone else, that’s all. Truth is that the design on this job was yet to be developed and you were building it too soon! That’s the true deep down cause of all this massive expense.
Time after time, contracts were placed before design work was completed. That is not the way to build. It is utter lunacy to build when the confounded drawings are not even drawn. Yes, yes, you can build like that; the lunacy is to whinge afterwards about the cost.
The prolongation and disruption and delay claims are hitting £100m. The actual work costs of numerous work packages are miles more than the order value. The completion is round about two years late. The inquiry here isn’t one bit about the form of contract, nor focused on the actual construction work, which is magnificent despite the disruption.
Inquire please about why this work was started before the design was fully developed. Look for the true cause – or do you just want to pick on the builders?
Tony Bingham is a barrister and arbitrator