Report of the Director of Operations (Highways) attached

This report provides an update on the progress of capital projects within Highways Maintenance, against the agreed costs.  The highways capital maintenance investment work is in year 3 of a 5 year programme.

The Committee considered a report of the Director of Operations (Highways), which provided a progress update on capital projects within Highways Maintenance, against the agreed costs.

The Director of Operations (Highways) referred to the main points and themes within the report which included:-

·                A £100m, 5 year highways capital investment programme is currently underway, which would primarily be spent on improving the condition of Manchester’s roads, footways and drainage, as well as supporting the maintenance of the bridge network;

·                The budget for the highway maintenance element of the investment was £80m although there had been some additional grants that have increased the available spend to £80.5m;

·                The spend to the end of March 2019 was £28.229m leaving approximately £52.3m available to spend;

·                The reasons for the difference between budget and spend in year for years 1 and 2;

·                Details of the various  maintenance schemes undertaken in years 1 and 2;

·                Year 3 (2019/20) programmes had all been agreed and work had commenced.  The proposed year 4 and 5 resurfacing programmes had been drafted and would be shared with Members.  These proposals would be subject to re-assessment at the end of the year, looking at new condition data, available budgets and liaison with other work programmes, with some schemes potentially added or removed dependent on assessed priorities; and

·                The quality of the work had been good with a failure rate for microasphalt as low as 0.17% which was better than the industry standards.  For those areas that had failed, contractors had made good any defects at no additional cost to the Council.

Some of the key points that arose from the Committees discussions were:-

·                Was the budget spend figures detailed in the report based against the original agreed budget position or a revised budget position;

·                Was the Council getting value for money from its highways maintenance investment programme;

·                What steps were taken to ensure work undertaken by contractors was of the required standard and what actions could the Council take if a contractors work fell below the required standard;

·                As the original £100m investment was an “invest to save” initiative, had any calculations been undertaken to identify the savings the programme was achieving or would achieve; and

·                What action was being done to address the problems that had been experienced with the former contractor of the Regent Road improvement works to ensure similar didn’t happen elsewhere.

The Director of Operations (Highways) advised that the budget spend figures were based against the revised budget position and noted that as per the Committees earlier discussion, future reports would contain the agreed original budgets as well as the revised budget position for greater transparency.  He also provided an explanation for the slippage of spend in previous years and assurance was given that this was now being brought back in line.

In terms of value for money, it was reported that the Council was now getting significant social value returns from its highways contracts and Officers will be testing value for money through the reprocurement of all frameworks for the final two years of the maintenance programme.

The Director of Operations (Highways) confirmed that the Council did inspect all works that were undertaken and this was done jointly with the contractor.  Contractors received 95% of the cost of the works undertaken upon completion and the remaining 5% was only paid at the end of a two year maintenance inspection period, subject to no deterioration in the works that had been carried out.   He also reported that his staff were aware of the defect levels provided by different contractors.  He was unable to give the Committee an assurance as to precisely how this was fed into the retendering process but asserted that it was.  It was noted however that the main incentive for contractors to deliver high quality works, was the ability for them to be able to re-tender for future works, as opposed to the 5% retention payment.

In relation to “invest to save” calculations, it was reported that it would be I years 4 and 5 of the programme were the benefits of the investment into highways maintenance would come to fruition and that this would be reported to the Neighbourhood and Environment Scrutiny Committee.

The City Treasurer informed the Committee that the issue with the former contractor for the regent Road improvement works would be being considered at a future meeting of either the Council’s Audit Committee or Neighbourhood and Environment Scrutiny Committee

Decision

The Committee:-

(1)       Notes the report;

(2)       Requests that the Director of Operations provides the Committee with information as to whether the seven contractors have Trade Union recognition; and

(3)       Requests that Committee Members are informed when a report on the  former contractor for the regent Road improvement works is taken to either the Audit or Neighbourhood and Environment Scrutiny Committee