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1.0 INTRODUCTION OF SOUTHMEAD HOSPITAL The North Bristol Trust is working together with Carillion on 430million project to offer users the best of the benefits of health services provided for its environmental friendly surroundings and sustainability. The Southmead Hospital is located two kilometres north of Bristol City centre in a heavily populated residential and urban area are undergoing a massive transformation of redevelopment. The hospital will be singled acute in bringing together the services currently provided at Southmead and Frenchay. The new hospital will be arranged over 7 floors of height to 4 floors at its lowest. It is planned the construction of the hospital will be commenced on the 24th February 2010 and completed by 28th March 2014 which is 49months of period. This construction phase then continue with the demolition and the construction of new main entrance that is commenced on 30th March 2014 and completed by 28th September 2015 within 18 months period. 2.0 SOUTHMEAD HOSPITAL BRIEF The hospital will be accommodating 800 beds in an 115,000 msq building which 75% of the room is single en-suite room. The building will also provide health services with 24 operating theatres, a production pharmacy and central sterile service department (CSSD). This includes major medical equipment facilitated for the hospital used. Besides the hospital will also provide with a commercial area that consist of concourse, retail shops and a catering facilities for the users. A two multi storey building will be constructed specifically for car park which means there will be plenty of parking spaces provided. There will be one main entrance and relevant departments located next to each other. The emergency department will also have its own entrance which will greatly improve the access for ambulance and helipad will also be linked straight into the department. This hospital building is one of the most environmental friendly buildings in the country for its bright and airy outside views which in a way impact users and other with therapeutic auras. In making the hospital a realization to its requirement, procurement strategy shown as below are obtained.

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3.0 SOUTHMEAD HOSPITAL PROCUREMENT STRATEGY The procurement strategies for Southmead hospital were basically based on the key objectives of the project intention; to construct new hospital that have a high degree of design flexibility and changing requirements for healthcare services .The facilities designed are to provide delivery of sharp increase in efficiency and effectiveness of services in hospital operation. Moreover, improvements in accessibility of clear welcoming urban site and emergency route as for transportation for the users of the hospital. This objectives underlined the framework of the whole life cycle of the project and the rationale for the development in overcoming constraints in refurbishment of the hospital such as; 1) Poor configuration of acute services around Bristol 2) Poor configuration of services of site 3) Poor access for patients 4) Poor environment The factors above were claimed to be unresponsive to Regional and National requirement which means the local NHS organization are unprepared to respond to overall NHS requirement. To overcome these conflict issues, the establishment of Bristol Health Services Plan has allowed the local trust to develop services with an agreed financial and capacity framework in consistence of the capital planning. Together with the aims to upgrade the standard of hospital facilities and modernization of health services, an outline business case (OBC) had been carried out and prepared between North Bristol trust, South Gloucestershire PCT and Bristol North PCT. Through the examination of OBC of the Southmead Hospital, the strategic framework are reviewed and structured to ensure the compliance is in accordance and reaching target supported by new organizations. One of the issues is re-appraisal of PFI and affordability. These reviews will undergo a process of analyses and changes made with reference to the scope of scheme and constraints of re-appraisal in objective and strategy as such; 1) Policy 5 key themes incorporated into strategic framework; equity, personalised care, concentration outcomes, safer service, local accountability. This reconciled the ambitions laid out in OBC. 2) Performance parameters Ensure changes are up to standard to reduce capacity with smaller offset from an increase in growth of assumptions. 2

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Overall reduction of beds in PFI development. Changes accommodated in Public Sector Comparator (PSC) and brief given to bidders.

3) Updated ambitions Execution of proposal to deliver Need for coherent clinical strategy and change programme

4) Clinical Strategy 5) Workforce implication Performance management Staff skill and competence Commissioning of education and training package

However the changes impacts are fairly minimal and not resulted in wholesale update of Public Sector Comparator (PSC). The objective and strategies identified above matched up to assumption around activity and capacity. Therefore having this established, activity such as transfers, performance and assessment of beds and other key issues; rooms designed in standard template to allow flexibility, scheme designed to absorb further number of beds and planning permission for additional capacity can execute into capital cost and financial context. Risk allocation of project also plays its vital role in achieving quality construction progress. In assessment of risk in this project, matters such as neighbourhood surroundings are emphasized as for its heavily congested site context that will create disturbance to the residents and patients. Besides, bad traffic movement due to construction can also consequently contribute to air pollution that will generate unsustainable environment contradicting to the projects target of achieving green and sustainable surroundings. Consequently, the team project has integrated in allocating risk to avoid interruption of construction progress by reaching out to community, giving talk and benefits in job opportunities. Therefore, in achieving this procurement strategy, the procurement route and contract agreement bring the project into further accomplishment.

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3.1 PROCUREMENT ROUTE The preferred integrated procurement route chosen for this project is the second fastest procurement of a UK PFI hospital. It is said that the new healthcare facilities provided at Southmead Hospital are the first to be procured under Competitive Dialogue rules via the Governments PFI. Carillion will use its wide range of in-house capabilities to provide a fully integrated solution, beginning with construction services followed by facilities management and life-cycle maintenance services over 30 year contract period. 3.2 THE CONTRACT STRATEGY The project agreement implied is a DBOF contract which comprises of 430million construction contract for a new 800 bed district general hospital to serve Bristol, North Somerset and South Gloucestershire and with 30 year operate and maintain concession of 3.5million per year. The contract also state 30 year of asset renewal and 2.5million per year and 30 year concession of management at 1.5 million per year. The total project
value is 1.15 billion. The new hospital will merge existing acute facilities at the

Southmead and Frenchay hospitals. The contract agreement contributes to integrated team project in terms of demonstrating technical understanding in design, construction and maintenance operation which resulted in collaborative working circumstances. 3.3 FUNDING MECHANISM The integrated parties involved are North Bristol NHS Trust, the Hospital Company (Southmead) Ltd (50/50 JV Carillion and Lloyds BG). As for the contractor involved are Carillion Construction Ltd and Carillion Services Ltd as the facilities management provider. Further elaboration of organization in figure 1.1 is shown in the appendix (refer page 9) of the Southmead Hospital redevelopment project consortium structure. This were procured during high volatility of funding markets over the period between OJEU and FC, it is illustrated that long term bank debt made available for debts that are well structured and have sensible balance of risk that delivered by strong sponsors. Funders involved are EIB 250 million. Lloyds Banking Group 150 million, RBS 75 million, NAB 51 million, Credit Agricole CIB 51 million and Societe Generate 50 million. This construction liability caps at 50% of contract value which is 215 million. The disadvantages and risk having PFI as a procurement route is that it has high legal costs and arrangement fee and most of the PFI refinancing benefits are favoured only to the private sector. However, there are more to advantage in PFI, it transfer risk to the private sector in ground conditions, weather, inconsistencies between documents and 4

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give guarantee on quality assurance as PFI contractor is responsible for maintenance and assets renewal. The whole life cost is also considered more and other procurement models which guaranteed services provisions and hand-back conditions. Furthermore, its fixed price capital, facility management and lifecycle cost contribute to contractual energy performance that has the speed of construction. Indirectly this contributes some value for money in the project. 4.0 IMPLICATION OF OGC Guide 3 & Guide 6 IN SOUTHMEAD PROCUREMENT With reference to the above procurement method of Southmead Hospital, its implication can be demonstrated in technical understanding of procurement strategies underpinning the theory of Office of Government Commerce (OGC) in Guide 3 and Guide 6 and the 2011 Cabinet office professional guidance. In achieving excellence in undertaking procurement, the Southmead hospital procurement strategy had implement the principals that is stated in the guide 3 procurement guide such as the business case. Thorough analysis had been made to make criteria for the project to be successful with the right organization of people undergoing the process towards sustainability. The following procedure in strategy guideline as in the flow chart shown in appendix figure 1.2 (refer to Appendix page 9) had been enforced by the Southmead hospital in achieving excellence in carrying out the brief of the project. In gateway 0, stakeholders who are the people involved in the organization of Southmead project for example, the North Bristol NHS Trust, Carillion Plc Ltd, Lloyds and other funders are identified in figure 1.3 shown in appendix (refer to page 10). Relatively, the appointment and outline of business case was carried out to plan and strategize in accordance to the aims and targets of upgrading the sustainability of surroundings and modernization of health services in Bristol. As per mentioned in the above procurement strategy of Southmead hospital. In acknowledgement of gateway 1, thorough examination of the outline business case of the Southmead project was made. The changes of review in justification of the issues addressed were carried out in matter of value for money. Therefore, the approval and estimation of whole-life cycle cost of each option firmly make a stand of its proposal brief development of the health service into an upgraded operation and maintenance and modernization of facilities. In agreement of this proposal, it leads to gateway 2 of procurement strategy; the contract preparation which is the DBOF contract agreement used in this project. The 5

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DBOF contract agreement principles in short are an integrated teamwork progress which enables team members to technically understand in achieving collaborative manners of each division of work. In a way, the project will gain the benefit of value; quality, cost and time in terms of speedy construction phase and reduce the amount of risk allocation that regularly happened in the traditional procurement route. In making decision of procurement strategy, further considerations were taken imposed of the business case layout. In reference to OGC guide 6 factors that could influence the procurement strategy such as the project objectives, constraints, cultural factors, risks, clients capabilities, and the length of operational service were all taken into account in the Southmead project during this decision making before agreeing on the contract agreement. Before the demolition and construction of the phase 1 of the hospital building, the project had focused on the neighbourhood context because of its site constraint. Therefore, cultural factors were highly concentrated and made its way into consideration of the business case. This is because the risk allocations are highly indicated during the construction phase which will interrupt the daily routine of the site surroundings such as the traffic movement of the site context and the entrance to the construction site. Consequently, this project requires a speedy construction progress and that the preferred integrated procurement route would be PFI and by using the DBOF contract agreement the intention of reaching collaborative working manner is accomplished. Therefore, in Gateway 3, the decision on investment had been made following to the contract awarded through competitive dialogue for integrated supply team; Full Business Case. In realising the effort to achieve the value for money, the project grasps the major point of effects that occur in the risk of the project. For example, the increase amount vehicles to area which will create congested, traffic, and omission. But with the building of 2 multi storey parking area, the revenue and income from the car parking will be an indirect benefit to the project for the value of money. Moreover, it also brings to the improvement of public transport links and encouraged people to use pedestrian and cycle pathway which reduce the amount of unnecessary journey. This indirectly gives an impact in improving the safety and sustainability of care. Not to mention improving the accessibility of care to patients. Importantly, this comes in the decision point 1 and 2 of outline design and detailed design where it is crucial for the building to follow the approval of design to proceed to construction. Lastly brings to its commissioning of facility the handover of contract to management for the occupation of building. Evaluations were made to manage the contract for services where it is applicable.

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5.0 CONCLUSION The implications of OGC guide 3 and guide 6 made on the case study of Southmead hospital shows that proper strategy should be made to achieve efficient and effectiveness of construction project. On this study, the conclusion made that Southmead Hospital had been successfully deliver its business case in achieving the ambitions of their target in attending to sustainability. The procurement route chosen also shows the strength of quality collaborative working manner in its intention. Relatively, the Trusts presenting the Business case are clear that there is a very strong case for a change underpinning the developments outlined and both are affordable and achievable. With the procurement guidance, detailed work undertaken on activity, income and affordability and risk assessment accomplished the needs of value for money in a construction project. Therefore, the implication on this guides are very important for construction team to achieve their ambitions and target for the sustainability of the future comings on building fields.

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6.0 REFERENCE Essential Text Office of Government Commerce (2007), Achieving Excellence in Construction Procurement Guide 1: Initiative into Action, 3: Project Procurement Lifecycle and 6: Procurement and Contract Strategies, OGC London. North Bristol NHS Trust (2008), Southmead Hospital Redevelopment: Appointment Business Case, NHS Bristol Greenhalgh B & Squires G; Introduction to Building Procurement; Spon Press 2011 Supporting Text Books and Reports Turner A (1997); Building Procurement, Macmillan Press. Fewings P (2010); Construction Project Management An Integrated Approach, Taylor & Franchis. Articles and Papers TPS Consult (2011): Landmark 430m Bristol Southmead Hospital Redevelopment Project Benefits, Bristol, United Kingdom (available online from: www.tpsconsult.co.uk/tps/news/2011/04_southmead.asp) TPS Consult (2011): Southmead Hospital Redevelopment Hospital, Bristol, United Kingdom (available online from: www.tpsconsult.co.uk/tps/assets/pdf/profiles/health/bristol_southmead_hospital_cdm.pdf) North Bristol NHS Trust (2010): Project to Document Development of New Hospital of Southmead, Bristol, United Kingdom (available online from: www.nbt.nhs.uk/news__media/latest_news/project_to_document_developmen.asp) Willis Newson (2010): Southmead Learning and Research and Pathology Buildings, Bristol, United Kingdom (available online from: http://www.willisnewson.co.uk/assets/files/Case%20Studies/Case%20Study_Southmead %20Learning%20&%20Research%20and%20Pathology.pdf)

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7.0 APPENDICES

Figure 1.1 (refer page 4)

Figure 1.2 (refer page 5)

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Figure 1.3 (refer page 5)

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Graphics of Southmead Hospital Building

Existing site of Southmead Hospital

Proposed Masterplan of New Southmead Hospital

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Proposed Design: View from the east

Proposed Design: View from the north-west

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Proposed Single ward room design

View into main course

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