The council’s early failures to refurbish the Bristol Beacon cost millions

The cost of refurbishing the famous Bristol music venue has almost tripled from £48m to £132m.

A long-awaited Bristol Beacon “lessons learned” report found the project was potentially doomed as a cash disaster from the start because no one was really held accountable until it was too late.

The council’s auditors, Grant Thornton, ordered the inquiry after it blamed the local authority for refurbishment costs almost tripling from £48m to £132m.

Two years ago, the financial watchdog told the council it had “underestimated the complexity and difficulty” of renovating the Victorian concert hall, saying it had failed to put in place effective arrangements to stop the bill from spiraling.

Now independent consultants Arcadis have published their findings and make damning early days reading.

Their report says the council ignored concerns raised by contractors working on the scheme about the condition of the building, creating a ‘them vs us’ environment.

It says the risks of spiraling costs were not properly assessed at the outset and that there were no contingencies in place should more money be needed, while the complexity of the various funding organizations and other stakeholders meant the board lacked flexibility if changes were needed.

The report, which is full of technical jargon and management speak, concluded: “Our findings indicate that the delivery of the Bristol Beacon was affected by the inherent challenges associated with the complex stakeholder landscape, as well as project-specific factors, particularly those focused on the project. establishment and initiation.”

Arcadis has identified 14 high-level lessons learned to try to ensure similar major projects do not suffer a similar fate.

Consultants said the issues were not fully understood or addressed until the authority established a “project management office” (PMO) in January 2021 – almost three years after the organization and other funders committed the original budget of 48, 8 million pounds.

Just two months later, once the extent of the Victorian concert hall’s “worst case” problems became known, they rose to £107m, later to become £132m.

A frequent criticism of the council was that it should have carried out more detailed investigations of the building before putting so much taxpayers’ money at risk.

One of the lessons learned by Arcadis said: “Due to the age, architectural design and construction of heritage buildings, it is common to encounter unanticipated works that introduce an increased risk of scope changes.

“The project schedule should therefore include more detailed due diligence and investigations to minimize the associated risks, recognizing that other elements may be discovered as work progresses due to the nature of the building.”

The report continued: “We understand that there was an awareness that the building structure and structure was in poor condition and there were risks during the pre-PMO phase that it might be in a worse condition than originally assumed.

“Feedback from interviewees noted that the scope of the survey was constrained by several factors, including maintaining day-to-day operations, asbestos in the building and funding constraints.

“In our view, the above may have led to re-design and contractual consequences for program delays and cost overruns.

“However, we note that invasive investigations may not have revealed finds such as hollow columns and buried wells that would have only been discovered during demolition, but may have focused attention on the risk due to poor condition of the building.

“It is recommended that sufficient time is allocated in the project schedule to carry out the necessary intrusive works and detailed investigations when working with heritage buildings.”

The report said the project board “did not function effectively in the early stages of the project” and that senior officers did not have the time or capacity to provide sufficient oversight.

Although he did not mention him by name, he said the situation did not improve until Stephen Peacock – who recently left the council as chief executive to become a top officer at the West of England Combined Authority (Weca) – took over when he joined Bristol City Council. as Chief Executive for Growth and Regeneration in 2019.

The report said: “Many stakeholders stated that the project team was inadequately resourced during the planning phase of the project and the roles and responsibilities of the project team were sometimes unclear.

“This was recognized by Bristol City Council in 2020 and appropriate controls (PMOs) and management were subsequently implemented.

“Many interviewees noted that project management capacity, particularly at the pre-PMO implementation stage, was insufficient.

“This was further exacerbated by the backlog of contract amendments which created an overwhelming administrative burden imposed by the type of contract.

“It appears that a lack of effective commitment from the project sponsor(s) (persons in charge) in the early stages of the project led to challenges such as poor communication and the development of an adversarial team culture.

“There has been a systematic improvement in leadership led by the Executive Director for Growth and Regeneration (project sponsor) in 2019, which has culminated in improved decision-making and led to a re-evaluation of both management and governance structures.

“At the start of 2020, the appointment of an experienced Head of Capital Projects to improve governance leadership and a Project Director to oversee project management was crucial.

“This move sought to improve performance by establishing a program management office, leading to proper alignment of the project to accurately represent its scale and complexity.”

The report said there had been a “step change” since 2020 that created a “one team” approach, but that the situation was very different before.

It said: “Stakeholders felt that their input and contributions were not properly acknowledged or acknowledged throughout the project lifecycle, leading to an ‘us vs them’ mentality.

A Bristol City Council spokesman said: “We are grateful for the effort Arcadis put into producing this report and all those stakeholders who took the time to inform this review.

“It is clear from this report that the refurbishment of the Bristol Beacon was a project of huge scale and complexity which experienced unpredictability throughout its life.

“The recommendations put forward by the authors of the report will provide valuable insight into the current and future management of the council’s heritage projects, particularly projects involving more complex financial arrangements and heritage assets that are likely to be in a worse condition than originally anticipated .

“While we welcome the recommendations made to improve current and future project governance, resourcing and delivery, these elements are only part of the full story of the Beacon refurbishment.

“What is outside the scope of this review is the impact of several external factors, including the global Covid pandemic and subsequent lockdowns and social distancing measures.

“The final days of the project were also affected by substantial material and energy cost inflation, plus labor shortages in the sector as development resumed following the pandemic.

“These factors were reported by the authority in January 2023.

“The lessons learned from this report and our experiences of delivering a major capital project in the face of significant external factors are being shared across authorities.”