Decision details
Your Fund Surrey Application - CF104 Normandy Community Shop & Cafe
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Decision Maker: Executive Director for Customers and Communities, Deputy Chief Executive and Executive Director for Resources
Decision status: Recommendations approved
Is Key decision?: Yes
Is subject to call in?: No
Purpose:
This decision record sets out the key information for publication on the decision by the Executive Director for Customer and Communities and the Deputy Chief Executive & Executive Director of Resources, in consultation with the Cabinet
Member for Communities & Community Safety and the Cabinet Member for Finance & Resources, to approve an additional 10% contingency payment due to inflation hardship for a Your Fund Surrey (YFS) project located in Woking. The agreed recommendations are set out below on the face of this decision record.
Decision:
It was AGREED:
- to fund up to an additional 10% of the original grant award (£51,835) for increased costs relating to current inflation levels towards Your Fund Surrey project CF104 Normandy Community Shop and Cafe.
a. The original grant award for £518,354 was granted 09/12/21. An additional 10% inflation hardship claim of up to £51,835 is allowable, and fully in line with, the Cabinet decision from November 2022.[1]
b. Works are currently underway and approaching fit-out of the new building.
c. Costs have increased due to increased material and labour costs across the build, including construction, electrics and plumbing. Costs have been evidenced and assessed as reasonable.
d. Contingency funding included within the original grant award (£37,676) is also being claimed towards the increased costs, however the additional 10% is also required to ensure successful completion of the build and achievement of the assessed community benefits.
The remaining build costs are £113,700. The project cost changes and reasons are detailed below:
CF104 Normandy Community Shop and Café Cost Breakdown |
Nov-21 |
Jan-23 |
Reason for change |
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Site setup |
£5,403 |
£4,500 |
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Foundations and building base |
£44,862 |
£48,515 |
Complications in groundworks |
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Project/site management, professional fees, evaluation |
£34,120 |
£38,036 |
Increase in lease fees |
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Surveys, structural and CDM engineers, building regs and planning |
£15,368 |
£7,696 |
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Construction of building |
£226,478 |
£262,117 |
Increased materials and labour costs |
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Scaffolding and basic materials |
£9,201 |
£20,997 |
Further electrics required, also increased labour and materials costs |
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Carpentry, Electrics and Plumbing |
£69,964 |
£122,876 |
Roof - increased material and labour costs |
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Further electrics required for heating and ventilation, also increased labour and materials costs |
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2nd fix plumbing - increased materials and labour costs |
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Drainage, services, pathways |
£49,746 |
£54,224 |
Extra work laying electricity cable by tunnelling & delays connecting requiring generator hire |
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Plastering, decorating, finishing, security |
£25,535 |
£33,127 |
Expected volunteers to be able to paint interior but decided professional needed due to working at height |
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Total |
£480,678 |
£592,089 |
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Grant paid to date |
£478,389 |
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Remaining funding required = new budget less grant paid to date |
£113,700 |
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to be funded by: |
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Balance of YFS grant funding |
£2,289 |
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YFS contingency |
£37,676 |
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10% extra YFS inflation hardship contingency (the subject of this decision report) |
£51,835 |
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VAT (YFS paid some VAT to help with cashflow – this is what the project owes SCC and will be deducted from future payments) |
£20,061 |
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Balance to be funded by Applicant |
£1,839 |
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[1] Cabinet approved the creation of an inflation hardship contingency, to manage the risk of construction and other inflation levels in Your Fund Surrey projects and delegate to the Executive Director of Customer & Communities and the Deputy Chief Executive & Executive Director of Resources, in consultation with the Cabinet Member for Communities & Community Safety and the Cabinet Member for Finance & Resources the ability to, in exceptional circumstances, award up to 10% of the bid value when presented with robust evidence that the variance is caused by the movement in the construction market, or inflation increases, since the original bids were submitted. The contingency will be met from the existing overall Your Fund Surrey programme allocation
Reasons for the decision:
This decision is to enable expenditure from Your Fund Surrey to be awarded to an already funded project to ensure completion and delivery of the anticipated community benefits and has been the subject of a rigorous assessment process by officers. Officers consider the additional funding request to satisfy the requirements to award an additional contingency payment due to inflation hardship.
Alternative options considered:
If additional funding cannot be provided, scope would have to be removed from the project, some of which was key to the funding decision and provides community benefits as assessed against the funding criteria. This option was rejected.
Some scope has already been deferred to a later date, which the applicant plans to fund themselves from profits after opening. This includes the external decking area for the cafe. Other funding is being sought towards some elements, such as LoCase for PV solar panels. Officers consider that the applicant has been proactive in managing cost increases.
Interests and Nature of Interests Declared:
None.
Publication date: 06/02/2023
Date of decision: 02/02/2023