What is the Hub initiative?
The Scotland-wide Hub initiative, led by the Scottish Futures Trust, reflects a national approach to the delivery of new community infrastructure. The idea behind the Hub initiative, set up in 2010, was to establish five public-private partnership development companies across Scotland to work regionally with local authorities, NHS Boards, emergency services and a number of other public bodies. All five companies are now fully operational and are already delivering real benefits to communities across the country.
Delivered in the South East, North, East Central, West and South West regions of Scotland, the aim of the Hub initiative is to:
- Provide a more efficient, quicker, sustainable procurement methodology for public sector bodies, resulting in improved value for money.
- Increase the scale of joint service working and integration between public sector organisations, resulting in better outcomes at the point of service delivery.
- Increase opportunities for strategic asset management across public sector bodies.
- Create real community benefits for local people and businesses as a result of the projects being delivered in their areas.
HUB SOUTH EAST SCOTLAND
What is Hub South East Scotland?
Set up in 2010, Hub South East was the first of the five Hubs in Scotland. All Hub companies are joint venture organisations, owned jointly between the public sector Participants (30%), Scottish Government, through the Scottish Futures Trust (10%) and the private sector, in our case the SPACE Consortium (60%).
A key point to note is that we are the public sector’s development partner and not contractors. Hubco is all about the integration of services, value for money and transparent procurement.
Our Participants include the five local authorities within South East Scotland, as well as the NHS, Police, Fire and Ambulance Service. Find out more about our Participants.
You can see up to date information on the status of each of our projects by visiting the Project pages of our website.
What is SPACE?
SPACE (Scottish Partnership and Community Enterprise) is a trading company, registered in Scotland and created in 2009 by Galliford Try, Fulcrum and Davis Langdon (now AECOM), with the sole purpose of working in partnership with public sector organisations participating in the Hub initiative in Scotland.
SPACE was successfully appointed in 2010 as the private sector development partner for Hub South East Scotland.
What kind of services do Hub South East Scotland provide?
We offer a wide range of service to Participants. This includes strategic asset planning, project finance, design, project management, cost management, construction and facilities management. Hubco offers Strategic Partnering Services on all projects. This service allows Hubco to work with design teams and contractors to de-risk projects, offering client certainty in relation to cost, buildability and programme.
What makes working with Hub South East Scotland different to using existing procurement processes?
Hub South East Scotland is a development company owned by the Participants, with a much more strategic role to play in assisting improve the delivery of improved services. In the absence of a delivery mechanism like Hub, it has proven difficult to create joint planning and delivery of services. As a result, services tend to be planned opportunistically and procured through fragmented routes by individual procuring authorities. The scale of investment in joint facilities is therefore likely to be much lower using traditional procurement processes than it will be with Hub.
Through Hub, the lengthy OJEU procurement process is avoided along with the time consuming and expensive competitive dialogue that this entails. With a Hub development you get:
- Cost certainty
- Programme certainty
- Early involvement of advisers and contractors
- Genuine Partnership working
- Effective Risk Management
- Cost savings in comparison to the standard public procurement process
- Standardised contract documents (lower legal costs)
- Transparent procurement
- A minimum of 80% of packages (by value) market tested
- A guaranteed range of community benefits (training, employment and SME)
- Dedicated staff on all projects
- A qualified and experienced supply chain working to capped rates
How does Hub fit in with existing community planning arrangements?
Hub complements, rather than adds to or replaces, existing joint working arrangements. It is an avenue through which proposals for joint facilities (identified through existing community planning arrangements) can be developed and delivered. Hub also offers the opportunity for private sector skills/experience to be brought into joint community planning arrangements. Hub will also seek to add value to Community Planning Partnerships by supporting a range of Community Benefits.
What projects can be delivered through Hub South East?
The Hub model is structured to give the potential to deliver a wide range of facilities to improve the provision of community services.
Our already completed projects include large facilities such as schools, health centres and partnership centres, as well as smaller refurbishment works from offices to public toilets.
Do all projects have to envisage the delivery of joint services?
No. Individual Participants are able to use us to deliver their own facilities as well as facilities that they want to share with other Participants or third parties. Nevertheless, a central theme of the Hub initiative is that opportunities to share facilities with other Participants should be maximised where at all possible, as this is likely to introduce cost efficiencies for all parties involved.
Can Hub be used to deliver projects partially developed outside of Hub?
Yes. Projects that have been partially developed through, for example, Health Framework Scotland can be delivered through Hub. There is a process established to novate designs at key stages in the development such as Outline Business Case (OBC) or Full Business Case (FBC) level approval.
Can third sector organisations be involved in developments?
Yes. Third sector organisations are encouraged to collaborate in the development of joint facilities and where appropriate to have dedicated space within joint facilities specifically tailored to their needs.
What are the “exclusivity” arrangements under Hub?
For the first 10 years of the partnership in the South East Scotland Territory, we have an exclusive right to develop proposals for certain projects. Projects specifically named in the South East Territory Partnering Agreement are:
- All primary/community NHS health facilities with a capital value exceeding £750,000.
- Joint NHS/Authority projects with a capital value exceeding £750,000 involving primary/community health facilities where the NHS is lead procurer.
Will Hub South East Scotland determine how, when and what projects are required?
The Participant organisation is the client for the project and Hub is not a replacement for the intelligent client function, a commissioner of new projects or an approver of final project proposals. It will remain the Participants’ right and responsibility to identify the requirements for community infrastructure investment within their territory (albeit with the opportunity us to assist with asset management and planning processes).
The Participants involved in a specific project being developed/delivered by Hub South East Scotland will retain the client role that they currently have on individual one-off procurements. A Participant can therefore have two separate identities within Hub – one as the procuring body (i.e. client) on a specific project and one as a minority shareholder in the company (i.e. Hub South East Scotland) delivering that project.
How can Hub South East Scotland help with service planning and redesign?
Our focus isn’t simply on the bricks and mortar of construction projects. As service redesign is undoubtedly a key priority for our Participants, we are increasingly acting as an enabler to ensure that innovative solutions are found to do more with less. The Hub process is fully flexible and goes way beyond traditional delivery frameworks. Participants can work with us to identify strategic service priorities, reconfigure their existing estates assets, identify funding options, develop specific building solutions and deliver new facilities.
Participants are enjoying the benefits of us providing Strategic Support Services (such as estates and service planning), as this allows them independently, or in partnership, to develop projects and initiatives at a strategic level, therefore de-risking key elements prior to committing financial resources.
And the success of our developing relationship with Participants is such that we now have staff seconded into their organisations, such as in Edinburgh where we’re assisting with asset management.
Our department is facing service reductions, with potential impact on property requirements. How can Hub South East Scotland assist?
Hub South East Scotland can assist with service rationalisation and efficiency improvements. This could come from joint working and sharing premises with resultant reduction in service delivery costs by working more closely with partner agencies, closer to the service delivery point and by working out of modern more efficient buildings.
What are the cost benefits of delivering projects through Hub?
Choosing to develop a project through the Hub route has the potential to increase the speed and reduce the cost of community infrastructure procurements:
- Financial caps mean affordability is built in as early in the process as possible
- Through Hub South East Scotland, the high costs of bidding for supply chain contractors are avoided by having already benchmarked and value for money assured Tier 1 Contractors ready to begin work
- Market based overheads and profits are guaranteed and transparent – there are no hidden costs within the prime costs
- Open book procurement is guaranteed
- Hubco procurement offers a price guarantee
Hub South East Scotland is required to demonstrate value for money throughout the development of new projects and in the delivery of the project pipeline and to demonstrate continuous improvement over a series of projects. Efficiencies will also arise through the use of joint/integrated facilities with complementary services being provided by different Participants from one location.
ALL projects completed by Hub South East have been delivered ON BUDGET.
What are the community benefits of delivering projects through Hub?
Hub South East Scotland has to meet community benefit targets for local employment, training and educational experience. This ensures increased opportunities for community engagement, local training, employment and SME involvement. Performance in this area is measured as a Key Performance Indicator.
To see examples of some of the community benefits already delivered, see our Community Benefits Information Sheet. You can also see stats for individual projects in the Completed Projects section of our website.
How is the development of projects paid for?
Hub Projects are developed on a 2 stage basis. Stage 1 develops the design to a level similar to Outline Business Case (OBC) and is undertaken at risk by Hub South East Scotland. Should the project be rejected for any other reason than it does not provide value for money or is not within the affordability cap, the relevant Participant will be liable to pay these Stage 1 development costs.
Stage 2 sees the development of the design to a level similar to Full Business Case (FBC) and the costs of this are paid (subject to a cap) using an agreed payment process. Costs incurred during project development are prepared using a schedule of rates submitted by the successful tenderer, hence achieving a competitive price. Rates are reviewed annually by reference to RPI, to other relevant local and national trends and to the rates and prices actually paid by hub South East Scotland for similar services
Who are the main Tier 1 Contractors working on Hub South East Scotland Projects?
Procurement of our principal supply chain members happened before signing of the Territory Partnering Agreement in 2010, with the pre-qualification, competitive tendering and selection of potential supply chain members.
We have 3 Tier 1 Contractors: GRAHAM Construction, Morrison Construction and BAM Construction.
How does an individual or company get on the Hub South East Scotland Supply Chain?
If you are interested in getting on Hub South East Scotland’s supply chain, you can contact one of our Tier 1 Contractors to register your interest:
How does Hub involve and promote access to opportunities for local SME firms?
Hub South East Scotland is open to employing SME firms and we already have a number of SME firms on our supply chain. There are also opportunities for SME firms to be employed by the main designers or the contractor delivering good or services to their local project. As opportunities become available, we hold Meet the Buyer Events to advertise these locally. Our SME opportunities page on the website will show more information on these as they become available
FINDING OUT MORE
I want to find out more about Hub South East. How do I do this?