Taxpayers to dig for £20M for Liverpool Dock

[Andy Onchan]

1 hour ago, 2112 said:

You can forget CT who still hankers Government responsibility, Julie Edge won’t upset the apple cart and again she’s accepted into the Manx Establishment. Rob Callister is a political Pygmy and chameleon who will do things to suit his own ends. He will keep his nose clean as when there is a reshuffle he will be begging for a Ministerial role. He is hardly likely to question his own decisions as he was previously a member of the DOI so will be privy to the comings and goings. I would suggest Stu asks the questions, he has clean hands and it’s too Manx Establishment.

I only mentioned those names because they're apt to chime in on here when it suits their own agenda. So I thought I'd give them the opportunity to show that they really are interested in representing the great unwashed tax paying Manx Public and not just when it suits them.

[Happier diner]

27 minutes ago, Non-Believer said:

It shouldn't be about compensation, it should be about the financial management of the project, where the money has gone already and where future money, and how much more, will go.

Unlike the power station whose shenanigans only came to light in the latter or even finished stages, the Dock is an evolving situation and very much in the public eye. It is and should be still very much an option to be asking questions.

But surely all that information is readily available.  Don't we pay consultant project managers and experts in cost consultancy to do that. It seems the issue is 'the contract' and you are basically stuck with that even if its not working to your advantage. Unless of course you have to courage to terminate it.

[Andy Onchan]

31 minutes ago, Happier diner said:

But surely all that information is readily available.  Don't we pay consultant project managers and experts in cost consultancy to do that. It seems the issue is 'the contract' and you are basically stuck with that even if its not working to your advantage. Unless of course you have to courage to terminate it.

If we are paying consultants then they would need to provide sufficient evidence that any out contract fees/costs/expenses etc are necessary, justified and proportionate and not just an excuse to bung a few extra quid on to their invoice to make their own numbers look good.

There is something terribly, terribly wrong with this project. Particularly since Peel Port's Liverpool2 container terminal development costs are slated at £400 million: https://www.peelports.com/about-us/investment

The way things are going our measly/minuscule little berth will be getting on for a quarter of that. How is that possible??

 

 

[Happier diner]

15 minutes ago, Andy Onchan said:

If we are paying consultants then they would need to provide sufficient evidence that any out contract fees/costs/expenses etc are necessary, justified and proportionate and not just an excuse to bung a few extra quid on to their invoice to make their own numbers look good.

There is something terribly, terribly wrong with this project. Particularly since Peel Port's Liverpool2 container terminal development costs are slated at £400 million: https://www.peelports.com/about-us/investment

The way things are going our measly/minuscule little berth will be getting on for a quarter of that. How is that possible??

 

 

I don't think it works like that. There are pre agreed schedules of rates. The cost consultants merely audit that it's done and the project manager authorises payments. 

These people may be consultants but they are in the employ of us. 

Like I say. If the contract was in the contractors favour right at the start and he is claiming extra for work that was  unforeseen or time delays outwith his control he will be paid. That's whether we like it or not. It's the way it works. 

[Andy Onchan]

2 minutes ago, Happier diner said:

I don't think it works like that. There are pre agreed schedules of rates. The cost consultants merely audit that it's done and the project manager authorises payments. 

These people may be consultants but they are in the employ of us. 

Like I say. If the contract was in the contractors favour right at the start and he is claiming extra for work that was  unforeseen or time delays outwith his control he will be paid. That's whether we like it or not. It's the way it works. 

Except the money that Tynwald is being asked to approve is not part of the agreed schedules. It is in addition to. And I'm afraid until Tynwald is party to the contract terms and scopes of additional work then we should make them sweat and wait for their money.

[Happier diner]

2 minutes ago, Andy Onchan said:

Except the money that Tynwald is being asked to approve is not part of the agreed schedules. It is in addition to. And I'm afraid until Tynwald is party to the contract terms and scopes of additional work then we should make them sweat and wait for their money.

That would not be sensible. That would put us in breach of contract. Just add interest to all the outstanding payments. 

I do agree that we should be putting pressure on those who are representing our interests but once things go bad, they usually get worse.

Three factors . CoVId. Unforseen ground conditions,  changes to the scope. Kerching kerching, kerching.

[Andy Onchan]

6 minutes ago, Happier diner said:

That would not be sensible. That would put us in breach of contract. Just add interest to all the outstanding payments. 

I do agree that we should be putting pressure on those who are representing our interests but once things go bad, they usually get worse.

Three factors . CoVId. Unforseen ground conditions,  changes to the scope. Kerching kerching, kerching.

You can bet your bottom dollar that Peel Ports wouldn't put up with this kind of shit.

Make them wait. Let them start proceedings and see how far it gets them.

[Gladys]

15 minutes ago, Happier diner said:

That would not be sensible. That would put us in breach of contract. Just add interest to all the outstanding payments. 

I do agree that we should be putting pressure on those who are representing our interests but once things go bad, they usually get worse.

Three factors . CoVId. Unforseen ground conditions,  changes to the scope. Kerching kerching, kerching.

We don't know the terms of contract to know if there could be a breach.  Or if the works are so open ended that everything falls within the contract. 

You would expect that the contract will specify works a, b and c for y price plus a contingency with staged payments against completion statements. Anything exceptional would have to be subject to an amendment to the contract, and there should be break and force majeure clauses.  You would hope that the contract is specific and does not bind IOMG to ever increasing changes to the works and increases in costs. 

From my limited knowledge of govt contracts in the UK, contracts are specific particularly as to cost because they will only get approval to the contract if the cost is within budget.  Exceed the budget and you are acting outside your powers. 

[Happier diner]

13 minutes ago, Gladys said:

We don't know the terms of contract to know if there could be a breach.  Or if the works are so open ended that everything falls within the contract. 

You would expect that the contract will specify works a, b and c for y price plus a contingency with staged payments against completion statements. Anything exceptional would have to be subject to an amendment to the contract, and there should be break and force majeure clauses.  You would hope that the contract is specific and does not bind IOMG to ever increasing changes to the works and increases in costs. 

From my limited knowledge of govt contracts in the UK, contracts are specific particularly as to cost because they will only get approval to the contract if the cost is within budget.  Exceed the budget and you are acting outside your powers. 

No they don't work anything like that. Just Google NEC3 contract.

Here's a link to the National engineering Council Web page which explains it.

https://www.ice.org.uk/knowledge-and-resources/professional-practice/nec-contracts-and-ice-conditions-of-contract#:~:text=NEC is a family of,practices%2C and define legal relationships.&text=The contracts are suitable for,purchase of supplies and goods.

It's almost certain it will be an NEC type 3 which is used almost exclusively in the UK and IOM for civil engineering contracts.

[Happier diner]

38 minutes ago, Andy Onchan said:

You can bet your bottom dollar that Peel Ports wouldn't put up with this kind of shit.

Make them wait. Let them start proceedings and see how far it gets them.

They will get their money. No point doing that. Remember the current £70m is the forecast outturn cost. Not what is paid to date. 

The only options would be to agree to terminate the contract by mutual consent or agree to revalue the costs. You would then have to start over of course. 

[John Wright]

22 minutes ago, Gladys said:

We don't know the terms of contract to know if there could be a breach.  Or if the works are so open ended that everything falls within the contract. 

You would expect that the contract will specify works a, b and c for y price plus a contingency with staged payments against completion statements. Anything exceptional would have to be subject to an amendment to the contract, and there should be break and force majeure clauses.  You would hope that the contract is specific and does not bind IOMG to ever increasing changes to the works and increases in costs. 

From my limited knowledge of govt contracts in the UK, contracts are specific particularly as to cost because they will only get approval to the contract if the cost is within budget.  Exceed the budget and you are acting outside your powers. 

The contract will be a fixed price JCT/NEC or similar, standard. But there’ll be clauses allowing for price increases for delay caused by things outside the control of the parties ( covid, material price increases over a certain amount, unexpected extra work necessitated by unforeseen work ( strengthening of the dock walls on river side and dock side, voids, archaeology, and client instructed changes ). We know there has been archaeology, the walls have had to be strengthened to cope with scour, that was notified late, allegedly, by the steam packet, that’s a client variation.

Its a brownfield site, there will have been reports available to contractors before tender, but only so much can be discovered from surveys and exploration.

Its one of those things that, once you’ve committed, it’s open ended.

The real question for me is, once we were given notice to leave the pierhead berth, and Stena became unavailable, there was no real assessment of the need for Liverpool, or alternatives. Yes, we sailed a ferry to Holyhead and Mostyn to check berthing. But all possible ports are at capacity. Mostyn and Fleetwood aren’t available. So it was spend a fortune at Liverpool or focus solely on Heysham.

Half our English passenger traffic passes through Liverpool. All our freight through Heysham.

I can understand IoMGovernment wanting to own and control any new site in Liverpool. We’ve paid for a new landing stage twice in the last 50 years, never owned it, always paid landing charges, been held to ransom by MD&HB and then Peel Ports, and then turfed off because servicing cruise liners is more lucrative and cheaper.

[Happier diner]

5 minutes ago, John Wright said:

The contract will be a fixed price JCT/NEC or similar, standard. But there’ll be clauses allowing for price increases for delay caused by things outside the control of the parties ( covid, material price increases over a certain amount, unexpected extra work necessitated by unforeseen work ( strengthening of the dock walls on river side and dock side, voids, archaeology, and client instructed changes ). We know there has been archaeology, the walls have had to be strengthened to cope with scour, that was notified late, allegedly, by the steam packet, that’s a client variation.

Its a brownfield site, there will have been reports available to contractors before tender, but only so much can be discovered from surveys and exploration.

Its one of those things that, once you’ve committed, it’s open ended.

The real question for me is, once we were given notice to leave the pierhead berth, and Stena became unavailable, there was no real assessment of the need for Liverpool, or alternatives. Yes, we sailed a ferry to Holyhead and Mostyn to check berthing. But all possible ports are at capacity. Mostyn and Fleetwood aren’t available. So it was spend a fortune at Liverpool or focus solely on Heysham.

Half our English passenger traffic passes through Liverpool. All our freight through Heysham.

I can understand IoMGovernment wanting to own and control any new site in Liverpool. We’ve paid for a new landing stage twice in the last 50 years, never owned it, always paid landing charges, been held to ransom by MD&HB and then Peel Ports, and then turfed off because servicing cruise liners is more lucrative and cheaper.

I'll wager its NEC3 Option E. Cost reimbursable based upon a tendered schedule of rates. So basically you pay what the contractors costs are, plus their mark up. I am sure IOM Gov wouldn't entertain anything else.

If the supervisor signs off work and the QS is happy that the costs are correct then the PM authorises payment. 

So if the contractors cost escalate your costs escalate. 

[finlo]

1 minute ago, Happier diner said:

I'll wager its NEC3 Option E. Cost reimbursable based upon a tendered schedule of rates. So basically you pay what the contractors costs are, plus their mark up. I am sure IOM Gov wouldn't entertain anything else.

If the supervisor signs off work and the QS is happy that the costs are correct then the PM authorises payment. 

So if the contractors cost escalate your costs escalate. 

So when do you expect you'll have all the works finished?

[Happier diner]

5 minutes ago, finlo said:

So when do you expect you'll have all the works finished?

Soon😄

[John Wright]

7 minutes ago, Happier diner said:

I'll wager its NEC3 Option E. Cost reimbursable based upon a tendered schedule of rates. So basically you pay what the contractors costs are, plus their mark up. I am sure IOM Gov wouldn't entertain anything else.

If the supervisor signs off work and the QS is happy that the costs are correct then the PM authorises payment. 

So if the contractors cost escalate your costs escalate. 

You’re probably correct on NEC3 option 3 for the engineering. 

I suspect the building itself will be steel framed, glass, and prefabricated off site and bolted together and affixed to a concrete platform.