Just the facts…... Spring 2012

N ever before has the spotlight been so keenly focussed on public sector infrastructure invest-ment as it has been of late. In December the Scottish Government published its Infrastruc-ture Investment Plan; shortly before that the UK Government unveiled its 2011 National

Infrastructure Plan and also announced a call for evidence to help reform the Private Finance Initia-tive. The importance of public sector infrastructure investment in helping support Scotland’s economy and the benefits this infrastructure will deliver to local communities can never be underestimated. The work SFT is carrying out on the ground across the whole of Scotland is a fundamental part of the investment programme. In the last couple of months, SFT has initiated work on an additional four TIF pilot projects; launched phase 2 of the National Housing Trust; handed over the very first hub project to City of Edinburgh Council which is now open; helped launch OJEU notices for two college projects worth circa £250m; seen the first school in the £1.25bn Scotland’s Schools for the Future programme

open in West Lothian, and announced the preferred bidder for the penultimate hub for West of Scotland. And this flurry of activity shows no sign of abating, which reflects well on Scotland with national industry commentators stating that Scotland is ‘stealing a march’ on its neighbours.

FIRST NPD PROJECTS GO LIVE Following the launch in December of two large college construction projects under SFT’s £2.5bn NPD programme, the colleges have an-nounced the shortlist of bidders. For city of Glasgow College, the bidders are: BAM, Laing O’Rourke and Sir Robert McAlpine. And for Inver-ness College the following three will go on to develop their tenders: Morrison and Interserve; Miller and Equitex; and Morgan Sindall, Forth Holdings and Kajima Partnerships. And the NPD programme is to be expanded further over the coming weeks and months as OJEU notices are due to be published for Edin-burgh Sick Kids hospital, the M8 motorway bundles and Kilmarnock College.

In relation to the two colleges, there had been a huge amount of interest as circa £250m will be invested into the two colleges. SFT’s role over the com-ing months will be to work closely with all relevant partners to ensure the efficient and effective procurement and construction of the colleges. Construction is expected to start in 2013 which will help protect a significant number of construction jobs. Barry White, stated: “Naturally we are delighted to see such a high calibre of tenders come in, and the announcement is a landmark achievement as it marks the first projects to be procured and built through the SFT-led £2.5bn NPD programme, one of the largest investment programmes of its kind in Europe. The OJEU notice for Kilmarnock College which is expected to be launched soon, will ultimately see the college relocate to a town-centre site currently occupied by Diageo.”

Artist’s impressions of the new City of Glasgow College campus

Welcome from Barry White—Chief Executive of the Scottish Futures Trust

T oday, the first completed hub project at Drumbrae in Edinburgh has opened and is providing essential services to the local community; construction of the combined Haddington Infants and St Mary’s Primary School is on target

to open after this year’s summer holidays; the East Neighbourhood Office and Library in Craigmillar is well on track and is expected to open this autumn, and the ground breaking ceremony for the Wester Hailes Healthy Living Centre was carried out recently by Deputy First Minister, Nicola Sturgeon. The first new facility in Drumbrae is at the heart of the local area and acts as a catalyst in building a vibrant and sustainable community providing a range of services including a library; learning centre; community information and access points; day care centre; community occupational therapy; ICT access points; kiosk payments – rents, council tax etc, plus a host of other ancillary services. Neil Grice, hub programme manager at the Scottish Futures Trust, explained: “Whilst the completed hub site is great for the local community, the economic benefits over the last year have been substantial. The build involved the local community and facilitated valuable work experience for young people. The project was delivered on time (within 11 months), and on budget (£5.7m) with the vast majority of design and construction work carried out by local SMEs whereby more than 80% of the construction value was procured from local firms. And during the build, site workforce peaked at 65 and created three new jobs.”

In relation to other hub areas, hub North is soon to be given approval for Aberdeen Health Village and a number of projects will get under-way this summer in the East Central hub area. At the start of 2012, the WellSpring Partnership was selected as the preferred bidder to deliver c.£200m of public sector infrastructure projects to partners for West of Scotland and for the final hub territory in South West Scotland, the preferred bidder will be announced in August and will benefit the communities of Ayrshire, Lanarkshire and Dumfries and Galloway. The total hub infrastructure pipeline of work is valued in excess of £1.4bn over the next ten years and will deliver high-quality, value-for-money facilities for communities the length and breadth of Scotland.

Building the right buildings, right It is nearly two years since the very first hubCo was formed in the South East territory covering Edinburgh, the Lothians and the Borders. Since then, much has happened.

Above - the completed and open Drumbrae hub development in Edinburgh Below - construction well underway at the Craigmillar hub site

The future’s bright for Scotland’s Schools for the Future

L ittle over a year ago, the then Minister for Skills and Lifelong Learning Keith Brown carried out the official ground breaking

ceremony for the new Pumpherston and Uphall Station Community Primary School to be built under the £1.25bn Scotland’s Schools for the Future programme. Handed over by Morgan Sindall just before Christmas, West Lothian Council took occupation of the new primary school and carried out a full fit-out programme, with the school officially opening its doors to pupils after the half-term holiday in February. Under the Scotland’s Schools for the Future programme, a further eight schools are being built (five of which will be open by March 2013) and construction on an additional 10 schools will start in the next 12 months. Such has been the success of SFT’s work in managing the programme, that an additional 12 schools will be delivered within the existing programme budget, rising from the originally anticipated 55, to 67 schools.

Picture: The new Pumpherston and Uphall Primary

Building on solid ground for NHT phase 2 Twenty-four tenants have taken keys and moved into the very first homes to be built through the National Housing Trust pro-gramme. Maritime House at the Bett Homes city-centre development in Stirling was completed just before Christmas and the first tenants took keys in January. With fully-fitted modern kitchens, en-suite bathrooms and built in wardrobes, the 16 homes have been completed to the highest of standards and reflects the standard that is required to be met for homes to be built under the NHT umbrella. SFT is working with local authorities and house builders across Scotland to complete a further 597 homes which will be occupied over the coming year. Such has been the success of NHT that Phase 2 was officially launched late last year which will aim to increase the number of affordable homes for rent across Scotland to over 1,000. Importantly, without the NHT programme, these homes would not be getting built and therefore NHT is helping safeguard over 800 construction jobs.

Pictured: Rona Rennie, one of the first tenants in her new home in Stirling

LOOKING AFTER YOUR BEST ASSETS

F ollowing the publication of two reports last year on public sector asset management describing how cost savings of more than £500m could be achieved by 2017, SFT has been developing its skills base and now has a robust team of professionals to help public sector bodies reduce operational costs.

The SFT team has been bolstered by a number of property professionals and is already making headway into a number of pilot projects. Colin Proctor, SFT’s asset management director, explained: “SFT is best placed to be the catalyst for change as we have the requisite skills to accelerate the programme of asset rationalisation and deliver further value-for-money savings to the public purse. “There is significant financial value in most of the public sector property estate. It is clearly evident that, if these assets are managed well and linked to new ways of working, this will make a significant contribution, not only to reducing asset running costs but also to the efficient delivery of operational services. The opportunity for public sector bodies to collaborate and to work across organisational boundaries to achieve their own and common goals, is immense and must be exploited wherever possible.”

An example of asset management best practice is the Fife Council super depot (pictured above). The Council has moved many of its services to the empty Amazon distribution warehouse on the outskirts of Glenrothes, which is well on target to reach annual savings of between £3-£4m.

SFT’s recent achievements in numbers......

1 school completed and open; 2 colleges in procurement; 3 hubCos operational; 4 additional TIF pilot projects announced; just over 5 months until preferred bidder

announced for final hub; 6 local authorities working with NHT; 7 months till next hub

development opens; 8 schools being built; SFT working across 9 specialist areas – asset

management – education – funding & finance – health – housing – hub – low carbon –

waste – transport, and construction of 10 more schools will start this year.

MAGNIFICENT 7

Spotlight on street lighting

O ne new initiative SFT is taking forward is in relation to street lighting, to establish the potential

financial and carbon savings that could be captured through the use of modern and efficient street lamps and central management systems. In a pilot programme, SFT is working with East and West Dunbartonshire Councils to develop business cases to assess the level of savings and to develop a street lighting toolkit to help other councils take forward similar cost-saving schemes.

At a time when traditional sources of public and private sector funding are under immense pressure, the appeal of Tax Incremental Financing to attract additional funds is such that for every £1 invested from the public sector, a further £5 can be unlocked from the private sector. So it was no surprise that when SFT called for applications for the next phase of TIF that 16 applications were received from 15 councils. In conjunction with Scottish Government, a further four pilot pro-grammes were chosen which brings the total of TIF pilots to seven across Scotland. Along with Glasgow, Edinburgh and North Lanarkshire Councils, the recently successful Falkirk, Argyll & Bute, Fife and Aberdeen councils will go forward and work with SFT to develop robust business cases. Together, the projects are worth hundreds of millions of pounds and are estimated to attract a further £2bn through additional investment and ultimately create over 17,000 new jobs. The new projects that were chosen are as follows: Falkirk Council which proposed a £52 million direct investment for key strategic road improvements; the Grangemouth

flood defences; and site enabling works. The scheme is forecast to attract £365 million of private sector funding, creating over 5,000 full-time equivalent additional jobs at national level Fife Council which proposed £17 million for improved vehicle and marine access to Energy Park Fife; site remediation

and enhanced delivery of a Levenmouth Low Carbon Investment Park. It is estimated that 1,000 new jobs could be created Argyll and Bute Council which proposed a £20 million application to extend Oban's North Pier and to construct a development road at Dunbeg/Dunstaffnage. 1,000 FTE jobs are expected to be created or protected Aberdeen City Council for the Union Terrace Gardens project which will see £92m invested into a number of projects

including an extension to the Aberdeen Art Gallery and creating business space at Denburn Valley SFT will now work closely with the local authorities to develop full business cases.

WASTE FACILITY FOR GLASGOW SFT is helping ensure that major waste infrastructure projects and services procured by local authorities are deliverable, affordable and sustainable. SFT has been working with a number of local authorities across Scotland in the development of initiatives to meet the requirements of the Zero Waste Plan and to reduce local authorities’ exposure to the increasing cost of landfill. Working closely with Glasgow City Council, SFT played a key role in securing the appointment of Viridor as the preferred bidder for Glasgow’s £150m residual waste treatment project. When built, this project will reduce Glasgow’s exposure to future landfill costs and complement its recycling performance.

Above: Artist’s impression of new waste treatment facility for Glasgow