Committee
Audit Committee, 26 Sep 2000
26 Sep 2000 · S1 · Audit Committee
Item of business
Holyrood Project
Good afternoon. This is the Audit Committee's first meeting on the costs and management of the Holyrood Parliament building project, following the publication of the Auditor General's report and his presentation to the committee last week. We will hold another meeting next Tuesday.
Our two main witnesses are the accountable officers from the Scottish Executive and the Scottish Parliamentary Corporate Body, who were responsible for the project at different times.
I welcome also the Auditor General, the permanent secretary of the Scottish Executive and the other MSPs who join our meeting today. Linda Fabiani asked me to say that she is here as an observer and member of the Holyrood progress group. She does not expect to ask questions.
Mr Muir Russell is the permanent secretary and accountable officer at the Scottish Executive. Prior to the change of client on 1 June 1999, the Scottish Office, which became the Scottish Executive, was responsible for project management and reported to the Secretary of State for Scotland, who was the client. We shall hear evidence from the permanent secretary this afternoon.
We will also consider the period since 1 June 1999. Mr Paul Grice is the clerk to the Parliament and principal accountable officer of the Scottish Parliament. He is the current project owner—that is, the most senior official who is responsible for the successful delivery of the project to the client, which has been the Scottish Parliamentary Corporate Body since 1 June 1999. We will hear from the clerk to the Parliament at our next meeting.
We will ask questions on five principal areas. We will ask about the project management and how well it met the challenges of the project. We will explore the arrangements for the cost reporting of the project. We will ask related questions about managing the project risk. We will finish today's meeting by asking for evidence about the state of the project at different times. In particular, we will ask about the state of the project just before the transfer to the SPCB last June. In our meeting next week with the clerk to the Parliament, we will consider the current state of the project and look ahead to consider the risks over its remaining life, as well as the issues that I have just mentioned. We have a lot of ground to cover.
Before turning to the permanent secretary for his evidence, I have agreed with the Auditor General that it would be good to start the meeting with questions from members seeking clarification or advice on the Auditor General's report. I remind the committee—and, especially, our visitors—that the Audit Committee inquires into the report of the Auditor General, so it is important that we do not stray into policy matters.
Our two main witnesses are the accountable officers from the Scottish Executive and the Scottish Parliamentary Corporate Body, who were responsible for the project at different times.
I welcome also the Auditor General, the permanent secretary of the Scottish Executive and the other MSPs who join our meeting today. Linda Fabiani asked me to say that she is here as an observer and member of the Holyrood progress group. She does not expect to ask questions.
Mr Muir Russell is the permanent secretary and accountable officer at the Scottish Executive. Prior to the change of client on 1 June 1999, the Scottish Office, which became the Scottish Executive, was responsible for project management and reported to the Secretary of State for Scotland, who was the client. We shall hear evidence from the permanent secretary this afternoon.
We will also consider the period since 1 June 1999. Mr Paul Grice is the clerk to the Parliament and principal accountable officer of the Scottish Parliament. He is the current project owner—that is, the most senior official who is responsible for the successful delivery of the project to the client, which has been the Scottish Parliamentary Corporate Body since 1 June 1999. We will hear from the clerk to the Parliament at our next meeting.
We will ask questions on five principal areas. We will ask about the project management and how well it met the challenges of the project. We will explore the arrangements for the cost reporting of the project. We will ask related questions about managing the project risk. We will finish today's meeting by asking for evidence about the state of the project at different times. In particular, we will ask about the state of the project just before the transfer to the SPCB last June. In our meeting next week with the clerk to the Parliament, we will consider the current state of the project and look ahead to consider the risks over its remaining life, as well as the issues that I have just mentioned. We have a lot of ground to cover.
Before turning to the permanent secretary for his evidence, I have agreed with the Auditor General that it would be good to start the meeting with questions from members seeking clarification or advice on the Auditor General's report. I remind the committee—and, especially, our visitors—that the Audit Committee inquires into the report of the Auditor General, so it is important that we do not stray into policy matters.
In the same item of business
The Deputy Convener (Nick Johnston):
Con
Good afternoon. This is the Audit Committee's first meeting on the costs and management of the Holyrood Parliament building project, following the publicatio...
Mr Robert Black (Auditor General for Scotland):
I am happy to answer members' questions.
The Deputy Convener:
Con
What, in relation to the Holyrood project, do you regard as policy matters, and on which matters should we remain somewhat circumspect in our questioning thi...
Mr Black:
As members know, it is not in my remit to question Executive policy. I suggest, however, that five major issues arise from my report to Parliament. The first...
Euan Robson (Roxburgh and Berwickshire) (LD):
LD
You pose a question in your report about the mix of skills—you also referred to that a moment ago. In paragraph 3.13, you refer to the absence of constructio...
Mr Black:
I deliberately put my comment as a question rather than as an assertion. When I considered the material, it occurred to me that there was perhaps a weakness ...
Euan Robson:
LD
Would a construction professional have been able to flag up risks that materialised subsequently?
Mr Black:
Yes. That is speculation on my part, but it is reasonable to take the view that somebody who had experience of running such a complex project might have pick...
Cathie Craigie (Cumbernauld and Kilsyth) (Lab):
Lab
Mr Black, you say that the type of construction management contract left considerable risks with the project. Will you expand on the risks that you believe t...
Mr Black:
In the report there is an exhibit that outlines different types of contract. I will not go through the process in detail, but in a traditional contract an ar...
Cathie Craigie:
Lab
I have a follow-up question. Throughout the report, you mention the uniqueness of the Holyrood project and the fact that it is difficult to compare it with o...
Mr Black:
We were not able to find a comparable project on a similar scale. If I recall correctly, I used the word "unique" in answering a question at the previous mee...
Margaret Jamieson (Kilmarnock and Loudoun) (Lab):
Lab
On page 43, you indicate that"Accounting for risk was insufficient".Will you expand on why that was important?
Mr Black:
I am afraid that the history of large public projects is one of cost overruns. That is not too sweeping a generalisation. A poor track record over decades ul...
Margaret Jamieson:
Lab
You indicated that Treasury guidance was issued in 1997. Are you satisfied that it was adhered to?
Mr Black:
No.
Andrew Wilson (Central Scotland) (SNP):
SNP
Despite that, there is a separate question. In paragraph 3.58, you mention that the risks that were mentioned by the permanent secretary did not materialise ...
Mr Black:
The memorandum from the permanent secretary to which you refer gives the impression that the need for the separate risk assessment was not entirely accepted ...
Brian Adam (North-East Scotland) (SNP):
SNP
When you spoke to us last week, you suggested that project management might have encountered major challenges in managing the complex environment, not least ...
Mr Black:
I acknowledge that there was a view within the Executive that the building could have been built for the budget that was available at the time of handover. H...
Brian Adam:
SNP
Can you give the committee an idea of what proportion of that list of difficulties came about as a consequence of decisions that were made prior to June 1999...
Mr Black:
It is difficult to say what proportion of the difficulties were the result of those decisions. Last summer, we were still at a very early stage of developmen...
Euan Robson:
LD
Was the Auditor General able to identify the status of the project at the point of handover? In other words, did the then Scottish Office hand to the corpora...
Mr Black:
From the evidence that was available to me, it seems that the handover was relatively informal. There was an exchange between the antecedent client and the n...
Euan Robson:
LD
Despite the fact that the team had no construction expertise?
Mr Black:
As I said, I have put the reference to construction expertise in the form of a question, as the observation is certainly made with the benefit of hindsight. ...
Karen Whitefield (Airdrie and Shotts) (Lab):
Lab
The last two paragraphs of the report refer to the establishment of the progress group. You have highlighted a number of concerns with the project up to that...
Mr Black:
You are right to say that my report stops at the point at which the progress group comes into being. We have not actively examined how things have gone subse...
Karen Whitefield:
Lab
What one piece of advice would you, as an auditor, give to the progress group on how it should monitor the project to limit any future difficulties?
The Deputy Convener:
Con
Is this within the scope of your report?