1 Managing the delivery and operation
of large scientific facilities
1. Since 2000 the Department has allocated over £860
million for the construction of 10 new large scientific facilities
and has earmarked a further £270 million for five more facilities.
The projects range in size from the construction of the Diamond
Synchrotron in Oxfordshire (£383 million for phases I and
II)[2] to the construction
of a new light source for studying matter, the Energy Recovery
Linac Prototype (£21.3 million). A list of the first ten
projects is at Annex A.[3]
2. The Office of Science and Innovation, part of
the Department of Innovation, Universities and Skills, in consultation
with the Research Councils, is responsible for overall science
policy. The Research Councils are the main public investors in
civil research in the UK. Each Research Council is responsible
for deciding the research priorities and for overseeing the provision
of the large facilities within their remit. By July 2007 there
were eight research councils: the Biotechnology and Biological
Sciences Research Council, the Economic and Social Research Council,
the Engineering and Physical Sciences Research Council, the Medical
Research Council, the Natural Environment Research Council, the
Public Accounts Facilities Council, and the Arts and Humanities
Research Council.
3. The Office and the Research Councils aim to strengthen
the UK's science base, and maximise its contribution to UK economic
development. The Office has created a Large Facilities Capital
Fund to meet part of the cost of funding new facilities; and the
Government has established a Public Accounts Facilities
Council, partly to create a more integrated approach to providing
large facilities.[4] The
Council was formed from the merger of two previous Research Councils,
the Central Laboratory of the Research Councils and the Particle
Physics and Astronomy Research Council.
4. There has been evidence of some good project management
in the delivery of large facilities but signs of slippage amongst
some projects yet to be delivered. The RRS James Cook was delivered
within three months of the original target date and within its
original budget. Three projects, however, which were at the build
stage or were finalising their procurement strategy, were running
a year behind schedule and for five the latest forecast capital
cost exceeded the initial budget (Tables 1 and 2). The
Diamond Synchrotron (Phase 1) had cost £10 million more than
its business case budget, which had however included no element
for contingencies. The Public Accounts Facilities Council
reported that in general the cost increases had reflected changes
in the scope of individual projects.[5]
Table 1: Project progress against planned delivery dates
Project
|
Year project approved
|
Planned completion date
| Actual or forecast date of completion as at March 2007
|
Number of months delayed
|
| Diamond Phase I
| 2001
| Sept 2006
| Jan 2007
| 4
|
| RRS James Cook
| 2002
| May 2006
| August 2006
| 3
|
| ISIS second target station with first suite of instruments
| 2003
| Sept 2008
| Oct 2008
| 1
|
| Energy Recovery Linac Prototype (Note 1)
| 2003
| March 2006
| Oct 2007
| 19
|
| Halley VI operational
| 2003
| Antarctic summer 2008-09
| Antarctic summer 2009-10
| 12
|
| HECToR
| 2004
| Dec 2006
| Sept 2007
| 9
|
| Muon Ionisation Cooling Experiment Phase 1
| 2004
| End of 2006-07
| Nov 2007
| 8
|
| Laboratory of Molecule Biology
| 2005
| June 2009
| May 2011
| 23
|
| Institute for Animal Health
| 2006
| Nov 2009
| Dec 2009
| 1
|
| Research Complex
| 2006
| March 2009
| June 2009
| 3
|
Source: National Audit Office
Table 2: Project progress against approved capital budgets
Project
|
Stage of completion at March 2007
|
Approved budget £ million (see note)
| Latest reported forecast of capital spend as at March 2007 £ million
|
% change
|
| Diamond Phase I
| Operational
| 253.2
| 263.2
| 4
|
| Diamond Phase II
| Being built
| 100.0
| 120.0
| 20
|
| RRS James Cook
| Operational
| 40.0
| 40.0
| 0
|
| ISIS second target station with first suite of instruments
| Being built
| 133.1
| 145.6
| 9
|
| Energy Recovery Linac Prototype
| Being built
| 12.9
| 21.3
| 65
|
| Halley VI
| Investment decision taken and construction due to start in December 2007
| 34.0
| 38.0
| 12
|
| HECToR
| Being built
| 65.0
| 59.4
| -9
|
| Muon Ionisation Cooling Experiment Phase 1
| Being built
| 9.7
| 9.7
| 0
|
| Laboratory of Molecule Biology
| Preparing procurement strategy
| 155.0
| 164.0
| 6
|
| Institute for Animal Health
| Prepared procurement strategy and preparing for investment decision
| 121.0
| 121.0
| 0
|
| Research Complex (excluding infrastructure)
| Prepared procurement strategy and now preparing for investment decision
| 26.4
| 26.4
| 0
|
| Total
| | 950.3
| 1008.6
| 6
|
Note: Budgets and estimates are on a consistent
cost basis for individual projects. There are, however, differences
in cost bases used between projects.
Source: National Audit Office analysis of Research
Council data
5. The Research Councils are forecasting significant
increases in operating costs for five of the six most mature projects,
for two of them more than 80% over the figure appearing in the
original business case (Table 3). The Public Accounts
Facilities Council will bear most of the impact totalling about
£27 million per year. The Research Councils will have to
bear the cost of any increased spending. The Department believed
that where facilities had been built to date, Research Councils
had the resources to operate them. But if there were a shortfall
in resources for operating new facilities, Research Councils might
have to make serious choices about using them.[6]
6. The Department accepted that the estimation of
likely operating costs had not been satisfactory and there should
be better benchmarks to predict costs. In the defence field, for
example, such calculations were more sophisticated.[7]
Project teams had to abide by the Treasury's Green Book on Project
Appraisal and Evaluation and follow best practice.[8]
Table 3: Changes in estimated annual operating costs since project approval
Project
|
Expected life years
| Estimate in approved business case £ million (see note)
|
Estimate at March 2007
|
% change
|
| Diamond Phase I and II
| 25
| 24.4
| 46.1
| 89
|
| RRS James Cook
| 25
| 2.8
| 3.5
| 25
|
| ISIS second target station
| 15
| 5.4
| 9.9
| 83
|
| HECToR
| 6
| 5.4
| 8.2
| 52
|
| Muon Ionisation Cooling Experiment
| 3
| 1.6
| 1.8
| 12
|
Note: Estimates are at 2006-07 prices and exclude
depreciation and capital charges;
Source: National Audit Office
7. Some project teams have encountered difficulties
in recruiting people with the right project management expertise.
For the RRS James Cook, for example, the team employed a consultant
at a cost of £1 million to help manage the design and delivery
phases because it needed specialist project management skills
for this project. The Research Councils were trying, however,
to move away from hiring one-off project managers for each project.
The Public Accounts Facilities Council intends to establish
and maintain a cadre of experienced people to provide the generic
project management skills required. The cadre will also be tasked
with capturing and sharing best practice across the Research Councils.[9]
8. The Wellcome Trust is contributing £53.6
million to the cost of the Diamond Synchrotron but, in general,
the taxpayer rather than the private sector is meeting most of
the capital cost of these facilities, even though the Research
Councils expect them to benefit the economy at large. Taking the
example of the Synchrotron, the Public Accounts Facilities
Council believed that its economic benefits would be too far into
the future for industrial companies to take an immediate interest.
But industry could buy into the facility, and the team managing
this project had earmarked around 5% of its initial capacity for
industrial companies willing to pay, rising to 10% at a later
stage.[10]
2 This figure includes £53.6 million from The
Wellcome Trust Back
3
C&AG's Report, Figures 1 & 2 Back
4
C&AG's Report, paras 1.2, 1.5 Back
5
Qq 21, 22; C&AG's Report, Figures 7 & 9 Back
6
Qq 8, 24, 25; C&AG's Report, Figure 8 Back
7
Qq 1, 23 Back
8
The Green Book: Appraisal and Evaluation in Central Government
- HM Treasury Guidance 2003 Back
9
Qq 10, 11, 21, 56; C&AG's Report, para 2.6 Back
10
Qq 3, 6, 31 Back
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