Management in Confidence MB2009.P.29

Management Board

Estate Governance Issues

Paper by the Director General of Facilities, HoC Introduction 1. The scale and complexity of the future programme presents the Parliamentary Estates function with an enormous challenge. There are though two fault lines in our present governance arrangements: the first concerns the relationship between the two Houses, and the second the relationship between the Parliamentary Estate Board (PEB) and the various project boards. Each poses a risk to the delivery of the Estates programme, but the PEB is well placed to resolve matters. And with a DG Facilities settled in post in the Commons; a Director of Facilities joining the Lords; and the M&E Programme getting underway, it is in any event timely to review the Estates MOU and the PEB TORs. Decisions 2. The two House Management Boards are invited to endorse the revised PEB TORs, and the Clerk of the Parliaments and the Clerk of the House to sign the revised Estates MOU. Scope 3. This paper focuses on the two fault lines; it does not claim to present a complete definition of the Estates business. Commons / Lords Interface 4. HOL contributes 40% of the cost of joint House projects, and for joint and Lords only projects alike (including maintenance and repair) the upper House depends on the Parliamentary Estates Directorate, a Commons organisation, for delivery. It is necessary to ensure that programmes and projects are delivered to meet HOL expectations; that HOL funds are spent strictly for the purposes provided; and that the position of the Clerk of the Parliaments as Accounting Officer is duly regarded. But the scale and complexity of the forthcoming Estates programme demands a coherent approach to the tasking and oversight of PED: the possibility of disagreement between the Houses concerning priorities, requirements or funding profiles represents a strategic risk to the management and development of our Estate. We must avoid placing the Parliamentary Director of Estates (PDE) in the position of receiving parallel and potentially conflicting tasking from DG Facilities (Commons) and D Facilities (Lords). 5. The PEB, a joint sub-Committee of the two House Boards, is well placed to manage the House interface. DG F (Commons) and D F (Lords) must work together at the PEB to ensure that the Programme definition, project governance arrangements and progress reporting procedures meet the needs of both Houses. PDE’s responsibility is then to deliver a joint Estates Programme within the time / cost / performance envelope determined by the Approvals of the various projects concerned. He must liaise regularly with D F (Lords), who will be accountable to

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Management in Confidence MB2009.P.29

Lords committees, through the Clerk of the Parliaments, for the degree to which Estates functions meet HOL requirements, just as DG F (Commons) is accountable to the Commons structure. There should be no reason for disagreement or misalignment between the two Houses at the PEB, but if it occurs any failure to achieve consensus will be reported to the two House Management Boards. Parliamentary Director of Estates 6. DG Facilities (Commons)’s line management function with regard to PDE is therefore of the usual administrative nature, but includes providing him with support and guidance in his task of establishing and delivering the programme required by both Houses; as shown below the authority for the execution of this programme comes to PDE from the Clerks of the two Houses through the PEB as a bi-cameral, Corporate body, not from DG Facilities as a Commons Officer.

Estates management

PED

Clerk of the Parliaments

PEB D F (Lords) DG F (Commons)

Line management

Clerk of the House

Project Oversight 7. The Parliamentary Director of Estates delivers the projects, under DG Facilities line management; he is presently establishing the organisational structure and project management disciplines best suited to our needs. At the moment the relationship between the various project teams, their boards, the PEB and DG Facilities is not clear, with an associated risk of overlap or lack of cover in oversight functions. This risk can also be managed through the PEB: having established the Programme, it would be sensible for the PEB to provide assurance on its delivery. It is proposed therefore that Estates related project boards should be convened by the two House Management Boards on the advice of the PEB (with single House projects remaining the province of the House concerned); the PEB will then keep project delivery under

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Management in Confidence MB2009.P.29

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review, providing Assurance and Risk reports as appropriate to the House Management Boards. 8. The PEB will shortly be considering the requirement for oversight of those projects which are presently covered neither by the Minor Projects Board nor their own dedicated Board. It may also be helpful to group routine Estates delivery functions, such as staffing; rents, rates & utilities; planned routine maintenance; and reactive maintenance into an annual Operations Programme. Proposals will be brought to the House Management Boards if necessary. Parliamentary Estate Board 9. The PEB therefore should support the two House Boards by:

a. Recommending, and keeping under review, Parliament’s Estates Strategy. b. Recommending the Estates Programme needed as a result (including new build, refurbishment, maintenance, acquisitions, leases and disposals). c. Recommending the convening (and dissolution) of Project Boards as appropriate. d. Taking reports on the delivery of the Programme, providing Assurance to the Management Boards (or for single House projects the one House Board concerned) that projects are progressing to completion in accordance with their respective performance / cost / time envelopes. e. Providing advice, where appropriate, to the House Management Boards on Estates matters, including governance arrangements.

Approvals

10. It is not clear what role, if any, the PEB should play in agreeing the business cases that translate elements in the programme into live projects. At the moment business cases are cleared by the respective SRO and passed to the Finance Directors for scrutiny prior to submission to the Accounting Officers for Approval. There may be value that other members of the PEB (either individually or as a Board) could add to this step: this is a matter for future consideration.

Review 11. The arrangements proposed here may not be ideal, but the PEB believes they will move us substantially in the right direction. My final proposal, therefore, is that we put these changes into effect, and review the role and structure of the PEB in two years time. John Borley Director General of Facilities (House of Commons)

PARLIAMENTARY ESTATE BOARD TERMS OF REFERENCE

The Parliamentary Estate Board is appointed by the Management Board of the House of Commons and the Management Board of the House of Lords to:

a. Recommend, and keep under review, Parliament’s Estates Strategy. b. Recommend the Estates Programme needed as a result (including new build, refurbishment, maintenance, acquisitions, leases and disposals). c. Recommend the convening (and dissolution) of Project Boards as appropriate. d. Take reports on the delivery of the Programme, providing Assurance to the Management Boards (or for single House projects the one House Board concerned) that projects are progressing to completion in accordance with their respective performance / cost / time envelopes. e. Provide advice, where appropriate, to the House Management Boards on Estates matters, including governance arrangements.

Accordingly it should:

• develop and maintain a Parliamentary Estate Strategy, informed by the Accommodation Strategies and Corporate Plans of both Houses.

• consider, on an annual cycle, PED’s proposed Estates Programme for the next

25 years, including outline plans for later years but appropriately detailed information, including cost forecasts, for the near and medium term.

• provide briefings and reports to the House Management Boards, and through them to and House Committees as required, in accordance with the requirements of the annual cycle.

• recommend the Project Board structure required to oversee the programmes.

• take reports as required to provide assurance on project delivery to the House

Management Board(s), ensuring that Risks are understood and reported.1 • keep Estates governance arrangements under review, ensuring compliance

with the requirements set out in the Resource Framework of the House of Commons and the Finance Handbook of the House of Lords.

• make periodic recommendations relating to the Estates function to the Board of

Management and Management Board and then to the House of Commons Commission and the appropriate House of Lords Committees.

The Board will generally meet monthly, and will always meet at least quarterly. Members should attend in person. 1 Organisational Risks sit with the Facilities Department Risk Register

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Composition Members: Director General of Facilities, House of Commons Director of Facilities, House of Lords

Director General of Resources, House of Commons Finance Director, House of Lords External Member(s) In attendance: Parliamentary Director of Estates Director, Facilities Finance Quorum The Board will be quorate if the following criteria are all fulfilled:

One or both of DF (Lords) or DG F (Commons) present One or both of FD (Lords) or DG R (Commons) present At least one member from each House present

Any member of the two House Management Boards is entitled to receive papers and to attend meetings of the PEB.

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PARLIAMENTARY ESTATE – MOU This Memorandum of Understanding between the Corporate Officers of the House of Commons and the House of Lords is in respect of the provision of Estates Services.

1. The Parliamentary Director of Estates is responsible for providing services to both Houses, in accordance with their respective Corporate Plans. He is appointed by the House of Commons Commission in consultation with the Corporate Officer of the House of Lords. He and his staff are members of the House of Commons Facilities Department. The Director General of Facilities is PDE’s reporting officer, but is to consult with D F (Lords) in completing his appraisal.

2. Recommendations on the Parliamentary Estate Strategy and the associated Programme are to be made to the two House Management Boards by the Parliamentary Estate Board (PEB). The PEB is a joint sub-Committee of the two House Boards, operating in accordance with its Terms of Reference and for the benefit of Parliament as a whole.

3. The House Management Boards will receive Assurance reports on projects concerning their respective Houses from the PEB.

4. Expenditure on Estate projects and day to day maintenance for the benefit of both Houses will be shared in the proportions of 60% by the House of Commons and 40% by the House of Lords.

5. Arrangements for the funding of the Estate services provided to the House of Lords by the House of Commons will be agreed from time to time between the Director of Resources of the House of Commons and the Finance Director of the House of Lords.

Michael Pownall Dr Malcolm Jack Clerk of the Parliaments Clerk of the House