Guernsey Press

Scrutiny to review project decisions

AN INVESTIGATION will be launched soon into how the States decides to spend millions on infrastructure projects.

Published
Scrutiny Management Committee president Chris Green. (24467110)

It comes amid concerns that major projects, such as waste, have been given the go-ahead only to subsequently need budgets to be revised significantly upwards and specifications change.

The Scrutiny Management Committee review will commence within weeks, with a task and finish panel set up to complete it.

‘My view is that given the experience of projects like the solid waste strategy, where costs progressively soared from the initially low estimated costs, and more recently the inert waste strategy, where initial costs have already been revised upwards once, we want to assess – among other things – the quality and accuracy of the information given to States members in debate and in the Billet about projected capital costs for major projects,’ said committee president Chris Green.

‘We want to ask if there is a better way of handling the estimates for large capital spending projects before they are approved politically and before they go out to tender.’

The strategy to export Guernsey’s waste was costed at £29.5m. in 2014, but by March 2016 the price was the same but without an in-vessel composter for food waste, collection vehicles or a material recovery facility.

Then by 2017 the budget was £33m.

The preferred solution for inert waste, a reclamation north of Belle Greve, was estimated at £30m. in December 2018 but by September was expected to cost some £42m.

The Scrutiny review will consider whether the current process of allocating funding for capital projects is appropriate; whether the existing mechanism is working effectively; whether an appropriate level of support is available for committees during the request process and whether the information supplied to States members at the initial stage of approval is sufficient.

The States currently has two main reserves that it uses to fund capital expenditure, the Capital Reserve and the Transformation and Transition Fund and then also the Bond.

In 2016, £31.5m was spent from the Capital Reserve, with £8.7m spent in 2017 and £944k and £1.8m spent on operating expenditure from the Transformation and Transition Fund in the same period.

The balance of the Capital Reserve increased from £160m in 2016 to £240m in 2017 and in the same period, the balance of the Transformation and Transition Fund was £25.1m in 2016 and £23.3m in 2017.

A report will be produced this year.

Deputy Charles Parkinson was president of the States Trading Supervisory board when the final go ahead was given to the solid waste export strategy.

It was being led by the former Public Services Department in previous terms.

He said: ‘I’m not defending the mistakes made by PSD, and I wasn’t even in the States in 2014. STSB delivered the only major capital investment of this States term, on time and under budget.’