'Hard and costly lessons must be learned' from failings of project

Powys County Council needs to learn the “hard and costly lessons” from the failings of a flagship project, a councillor said.

Y Gaer - cultural hub and library in Brecon
Y Gaer - cultural hub and library in Brecon

This is so that future projects don’t spiral out of financial control.

At a meeting of the Governance and Audit committee, councillors discussed a report by the council’s internal auditors, SWAP who looked at reasons why Y Gaer in Brecon, was delivered late and £5 million over budget.

The committee believe that the report gives them “partial assurance” that the issues will not be replicated in the future.

They will wait to see reports on the financial governance and management of other building projects, before deciding that they have full confidence in the checks and balances the council now  has in place

Committee chairman, Councillor John Morris said:  “We need to make sure that the public purse is protected.

“It does give is huge food for thought, we have to admit there were huge failings, that has cost this council and the residents around £13.5m.

“The total cost with interest payments and grants comes to £17.5m, it’s a hard and costly lesson to learn.

“It’s imperative that cabinet, scrutiny committees and we as and Governance and Audit committee make sure we fully understand the costs of projects.”

The report was presented to the committee by SWAP deputy director Ian Halstead and concentrated on the process of governance and financial control to find out if they were effective.

Their report looked back at the project from its inception nearly 20 years ago and identifies 11 areas for improvement.

Mr Halstead told the committee that each building project should have an individual risk register, and that “it would be wise” for them to be able to view those and “be alert” to any issues.

Councillor David Thomas said: “The report reflects the culture at the time, and it represents a catalogue of errors and miscalculations.

“Audit committee, scrutiny committees, Finance Panel, all expressed concerns about elements of this and were proven correct in the end.”

Councillor Morris asked the council’s head of finance, Jane Thomas, how managing building projects had changed in light of Y Gaer?

Head of finance, Jane Thomas answered: “I think the most important changes is to the capital governance framework that we introduced a few years ago that clearly sets out the requirements of how you consider a project.

“We’ve introduced a five-case business model for all of our projects, and it really sets out the roles and responsibilities.

“Most of the schools projects have to go through that in order to draw down Welsh Government funding.”

“They are very detailed, and we’ll be bringing them to Audit committee so that you can better understand what’s included in them.

At the meeting the council’s director or environment and economy Nigel Brinn, said the report did not mention “what’s actually been achieved.”

Mr Brinn said:  “It’s genuinely a fantastic facility, it’s clearly one of the most important buildings in the county.”

“We’ve been able to pull £4.5m of funding and discussion seems to have almost glossed over that.”

“The key decisions and timings were at the end of 2016 and the beginning of 2017 when the contracts were awarded, it became a more well managed and governed activity after that.”

In December 2019, Brecon’s new cultural hub and library, Y Gaer (Welsh for Fortress) finally opened.

It is the redevelopment of the Grade II* listed Shire Hall and construction of a new modern library at the former Brecknock Museum & Art Gallery.

The council will be paying off borrowing that was used to fund the project for 50 years.

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