Examination of Witnesses (Questions 80-99)
SIR LESZEK
BORYSIEWICZ, DR
MARK WALPORT,
PROFESSOR MALCOLM
GRANT, AND
MRS LYNN
ROBB
17 DECEMBER 2007
Q80 Graham Stringer: So you are in
discussions with DIUS and the Treasury about the overall project?
Sir Leszek Borysiewicz: Yes.
Q81 Graham Stringer: Can you tell
us what stage those discussions are at?
Sir Leszek Borysiewicz: They are
preliminary discussions at the present time.
Q82 Graham Stringer: You said it
was only an initial estimate, the £500 million, which does
not include the land costs. The nature of these projects is that
they tend to inflate. How confident are you that you are even
in the right ball park with that £500 million?
Sir Leszek Borysiewicz: We have
sought external advice in relationship to that, and obviously
that advice is commercial at the present time, but we are reasonably
confident that those figures are robust at this stage in discussion,
although I do very much take your view that one has to be very
careful because of the way in which inflation will eat into this.
What is very critical on this pathway is obviously to make sure
that we can stick to a very rigorous timetable in relation to
the scrutiny so that we do not allow for slippage and therefore
the additional cost that inflation would incur.
Q83 Graham Stringer: Have you appointed
a design team or project management team yet?
Sir Leszek Borysiewicz: At this
point, no, we have not.
Dr Walport: There is an OJEU procurement
going on. I am not sure what OJEU stands for.
Professor Grant: Official Journal
of the European Union.
Q84 Dr Gibson: Have you a fancy architect
in mind? That will cost you a bob or two.
Dr Walport: I think we will have
a good architect but we have not decided yet.
Sir Leszek Borysiewicz: What is
really important is to make sure that we can establish the science
that needs to be there so that when we draw up a reasonable brief
the designers and architects can work to a brief which has taken
into account the scientific utility of this particular site. That
is the key thing for us at this point to establish.
Q85 Graham Stringer: So when do you
expect to appoint project managers and design teams?
Sir Leszek Borysiewicz: That is
why we are at the present time looking in a timetable which I
would expect to be completed during the first half of next year.
Q86 Chairman: I would like to come
in on two points of clarification. First of all, it seems to me
that in terms of the build-up of the resource there are a number
of unknowns. The money from Wellcome is known, the money from
Cancer Research UK is known, I presume that the university is
putting some money in, which we have not mentioned yet, but that
is known.
Professor Grant: I did mention
it, Chairman. We are proposing to put in up to £46 million.
Q87 Chairman: That is £46 million
so that is known. The two bits that are the big unknowns that
Graham Stringer has referred to are, first of all the money from
the Large Facilities Capital Fund, and you say you have not even
begun negotiations with the Treasury, or indeed with the Large
Facilities Capital Fund over that, and the second bit, which you
have not mentioned, is the money which the MRC has in its own
accounts, which I understand is over some £200 million. Is
that money still there?
Sir Leszek Borysiewicz: We do
not have £200 million at the present time.
Q88 Chairman: What have you got?
Sir Leszek Borysiewicz: At the
present time the amount that we have in reserve is £106 million.
It is going to be declared in our accounts which I understand
are going to be laid before the House tomorrow.
Q89 Chairman: What has happened to
the rest?
Sir Leszek Borysiewicz: There
has been a change in the rules that are being applied to our reserve
at the present time. What has happened is that Treasury are now
considering the monies that we had set aside for this as part
of the normal departmental allocation and is therefore moving
some of this to a Treasury fund. That way £92 million is
being moved.
Q90 Chairman: So £92 million
is being taken out of the savings that MRC have been making in
order to bolster up Treasury funds elsewhere? Is that true?
Sir Leszek Borysiewicz: Treasury
is taking
Q91 Chairman: Is that a fact?
Sir Leszek Borysiewicz: That is
a fact in the way in which you put it. What is happening is that
Treasury believe that there is a set of rules that they wish to
apply to this money. Those rules were extant beforehand
but they had not applied them up until this point. They have now
changed their view and wish to apply them to the monies that have
been saved.
Q92 Dr Gibson: Why have they suddenly
enlightened us with this discovery?
Sir Leszek Borysiewicz: If I may
be so bold, probably you should require that to be answered by
Treasury rather than myself.
Q93 Chairman: The point I am trying
to get, which is very important indeed, is that this Committee
has been told over a number of occasions is the bedrock on which
the MRC is able to put roughly £250-£300 million into
a major project and you are saying that a third of that has just
been taken away?
Sir Leszek Borysiewicz: Yes. It
is closer to a half.
Q94 Dr Turner: That merely adds to
the uncertainty around the financial package. Given the way the
costs inflated on the NTH proposal, they reached a limit of £360
million before it fell, there is another factor which I hope you
have taken into account in your costs which has not been present
in the past, and that is that you will be doing this work, if
it happens, at a time when the building industry in this country
is having an Olympic boom which will obviously make it more difficult
to get hold of the best contractors and will also increase prices.
Have you factored that into your plans?
Sir Leszek Borysiewicz: That has
been factored in at the standard rates that one would apply.
Q95 Dr Turner: Is there a standard
rate for the Olympics?
Sir Leszek Borysiewicz: There
is an anticipated rate, I think would probably be a better way
of looking at it, because it is almost impossible to say how big
that boom is likely to be, but it is usually factored in at about
8-12 per cent..
Q96 Dr Blackman-Woods: My first question
is to Mrs Robb. What has been the reaction of the staff in the
London laboratories to the news of the new location?
Mrs Robb: Our staff have been
incredibly positive. They do see that this is a really good time
for us to get involved in a venture such as this and see the opportunity
of (a) a new world-class facility and (b) a step change in the
size of the institute and the work that they will be doing and
all the collaboration and additional work that that brings for
them, so our institute are very strongly behind this and are very
interested in it.
Q97 Dr Blackman-Woods: Do you know
what you are going to do with the vacated labs?
Mrs Robb: We are looking at how
we can dispose of that site because, obviously, that is going
to form part of our funds to finance the build, so we will be
vacating the central London site as well.
Q98 Dr Blackman-Woods: Sir Leszek,
how were your staff at NIMR consulted on the development of the
whole new vision for their future?
Sir Leszek Borysiewicz: I have
met with the staff on two occasions since taking up my position,
the last time last week as soon as the announcements were made.
It was the earliest possible time I could have met with them.
My overall sense is that there is some excitement about the vision.
I think there is apprehension, with the history that NIMR has
been put through, so there is considerable apprehension by staff.
I believe that it is going to be up to us to ensure that we can
convince them that this can go ahead and that the science is not
going to be impacted on adversely, but I do believe that we can
bring the staff with us once they can recognise that this vision
can become a reality.
Q99 Dr Blackman-Woods: What is the
balance, do you think, at the moment between excitement about
the future and anxiety?
Sir Leszek Borysiewicz: I have
not done a straw poll of the staff. I would love to know, but,
as in all these projects, there is a diversity of opinion and
both sets of opinions have been expressed to me.
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