Department of Health: The Paddington Health Campus Scheme

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part twoPart TwoThe way the Campus partners approached the schemeexacerbated the risks14The Paddington Health Campus scheme
part two2.1 This part of the report focuses on the risks faced bythe Campus partners in delivering the scheme outlined inthe 2000 OBC and the way in which the Campus partnersattempted to manage those risks.There were complex intrinsicproject, organisational and policyrisks for the Campus scheme2.2 The Campus scheme, like other major capitalschemes faced multiple layers of risk: intrinsic projectrisk, organisational risk and policy risk. However thescale and complexity of the scheme meant that theserisks were exacerbated by the ways in which the Campuspartners chose to address them. In addition, the schemewas based on the 2000 OBC which the 2004 JointReview (Appendix 2) found was produced at speed andcontained a number of errors and omissions such that itwas not deliverable at the price within the OBC.Intrinsic project risk2.3 These are risks faced by any major capitalinvestment. The only NHS-specific risks relate to theclinical content. All capital investments must managethese risks. Many struggle unsuccessfully to balance time,cost and quality. None will succeed without good risk,project and programme management.2.4 A major project risk affecting affordability is thatof the history of cost escalation for large NHS schemes.All large NHS capital investments (schemes above£75 million) cost significantly more than their initialOBCs. For major schemes either in planning or buildstage, the average cost increase above the original OBCis 117 per cent (Figure 3 overleaf). In the case of theCampus scheme it was late 2002 before the Campuspartners realised, for the first time, that, because of theinadequate 2000 OBC, the likely full costs of deliveringthe scheme had more than doubled to £786 million(excluding optimism bias).2.5 In the case of the Campus scheme, the 2000 OBComitted any material cost relating to how St Mary’shospital would be kept operational while the newhospitals were built on the St Mary’s site – the decantstrategy. The original OBC allowed £1 million for this.The Campus partners’ 2003 estimate was for £80 millionfor what was, by then, a completely different schemebecause the Campus’s space requirements grew duringits development.The Paddington Health Campus scheme15
Page 1 and 2: department of healthThe Paddington
Page 3 and 4: DEPARTMENT of healthThe Paddington
Page 5: Part 3The Campus partners were unab
Page 8 and 9: summary8 While the Campus partners
Page 10 and 11: summary21 Ultimately, in addition t
Page 12 and 13: part onePart oneThere was a strong
Page 14 and 15: part oneThere were strong clinical
Page 18 and 19: part two2.6 Securing planning permi
Page 20 and 21: part twoRisk management2.14 The NHS
Page 22 and 23: part two2.28 Public support for the
Page 24 and 25: part three3.1 The Royal Brompton an
Page 26 and 27: part three3.12 The PDCL negotiator
Page 28 and 29: part three3.24 All Campus partners
Page 30 and 31: part threeThe changing proposals fo
Page 32 and 33: part three6A comparison of capital
Page 34 and 35: part fourAccountability for the sch
Page 36 and 37: part four4.8 Some of the advice and
Page 38 and 39: part five5.1 Both NHS Trusts contin
Page 40 and 41: glossaryLondon Regional OfficeMemor
Page 42 and 43: appendix oneAppendix oneChronology
Page 44 and 45: appendix one2004 (continued)JulyChi
Page 46 and 47: appendix two7 It was the view of th
Page 48 and 49: appendix fourAppendix fourThe oppor
Page 50 and 51: appendix fiveDepartment of Health:

Department of Health: The Paddington Health Campus Scheme

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