Fargate Containers: Damning findings on ‘failed’ Fargate Container project in new report
The project was designed to get people into the city, with the containers used for eating, drinking and entertainment spaces.
But in the year since news first broke of the plans, the project saw a sewage scare, delays after delays, disagreements, vendors pulling out, low footfall, and the bar never being completed, as costs and negative press mounted.
In January this year, councillors on the strategy and resources committee voted to kill the project completely and give the containers to community groups.
The auditors – whose purpose was to provide an independent opinion and identify areas where controls were operating poorly or where controls were not in place – have found that the construction had failed as the usual and defined procurement process was not followed, nor were contract variations documented.
In summary, they stated: “Project management practices were not followed and more worryingly formal financial and contractor monitoring throughout the work was poor or non-existent, furthermore, no risk management was in place.
“The lack of controls and poor governance arrangements led to poor decision making and ultimately the project did not succeed.
“When trying to ascertain the reasons for this project failure, it emerged that the head of service (who took on the de facto lead role on the work), did not have dedicated specialist skills, support and resource.
“The council’s specialist project management teams were not fully or formally involved, but only called upon using an ‘ad-hoc’ approach.”
While the auditors stated it was not theirs to put blame on anyone, the report revealed that had the controls been in place, delays and subsequent costs could have been dealt with and managed more efficiently.
It was also added that the staff working on the project had felt a “now or never” mindset to use the available grants in order to increase footfall in the city centre post-Covid.
The audit found that the contractor had been chosen and the Procurement Strategy and Contract Award had been signed off in December 2021.
It was revealed that the GBF (Get Building Fund) grant had been used for this project and a leader’s report had been signed off by the acting chief executive and leader of the council in February 2022.
However, the Concession Agreement for an eight-month period had come with “£300k at risk”, the audit added.
The report said: “Though procurement was signed off at the correct level, there was no evidence provided to IA (Internal Audit) to demonstrate that it was robust or complete to result in an informed decision-making process”.
During the process, the audit said, building control had notified the contractor of issues with the work.
The contractor had told the HoS (an abbreviation we cannot know what it stands for as it is reacted in the report) said these issues were “minor and in hand” but the report said it had not been the case.
It added the issues had been leading to further delays and the ground floor had only opened in October 2022 – 10 months later than originally planned.
Internal Audit was told by the HoS that he thought work should have ended after the first delay in May 2022. At that point, the report said, only £200k of an updated £445k budget was spent.
The contractor had reassured the HoS that “they were still on track” to complete.
IA had also reported that HoS had “briefly” informed them they had gone beyond the grant funding (£447k).
In the managers’ comments throughout the report, it’s said lessons will be learned.
The IA report will be discussed at Sheffield Council’s audit and standards committee at 5pm on Thursday (November 23).