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ITEM EX11

EXECUTIVE - 7 APRIL 2004

THE LIFT PROJECT PARTNERING AGREEMENT

1. The Local Improvement Finance Trust (LIFT) is a Health-led Public-Private-Partnership to provide new buildings for primary and community health and social care.
2. Local authorities are being invited by their local LIFT initiating body to consider at what level they wish to participate. This report sets out the background to the initiative, the current situation, and future options proposed to this Oxfordshire County Council by its local initiating body, Oxford City PCT.

Background

3. LIFT is a government initiative intended to stimulate investment in local primary care and social care facilities. The process requires the selection of a private sector partner who will work with the public sector partners to establish a LIFTco to deliver such facilities. Forty-two schemes are being developed across England, led centrally by ‘Partnerships for Health’, a joint venture between the Department for Health and the Treasury’s Partnerships UK for this purpose.
4. Oxford City Primary Care Trust has acted as lead on this initiative. After obtaining approval to proceed with the LIFT procurement the PCT invited Oxfordshire County Council to participate, together with Oxfordshire Mental Healthcare Trust and Oxford City Council. The notice in the Official Journal for European Communities (OJEC) was published with these organisations as the proposed participants
5. The Oxford Radcliffe Hospitals is also a participant in the Oxford LIFT. The Oxford City PCT has led the process for the development of the first edition of the Strategic Service Development Plan (SSDP), setting out the proposed service delivery for the first tranche of schemes.
6. A Project Board was established to oversee the procurement of a private partner and subsequent establishment of the LIFTco. This board will transform into a Strategic Partnering Board, which will act as the primary mechanism for managing LIFTco‘s performance, including financial and operating performance.

The Strategic Partnership Board And Partnering Agreement

7. Oxfordshire County Council, has been a member of the LIFT Project Board since its inception in October 2002 and has been actively engaged in the finding of a private sector partner. The Council was a named participant in the Official Notice for European Communities (OJEC), and took part in both interviewing the seven consortia who pre-qualified, and evaluating the three bids submitted by the short listed consortia.
8. The choice of the private sector partner, Infracare (funded by Sumitomo Banking Corporation Europe Limited was based on their financial standing and experience, and most important of all, their proposal for the development of a true partnering relationship and service agreement between LIFTco, the Strategic Partnership Board and the Participants. The Strategic Partnering Board will act as the primary mechanism for managing LIFTco‘s performance, including financial and operating performance.
9. LIFTco will demonstrate ‘value for money’ in two ways:

• Market testing its supply chain on each new project
• Market testing its supply chain for the first new project after a specified interval and periodically thereafter.

10. The parties in the SPA will agree the market testing tender information and criteria.


11. The following principles underpinning the Strategic Partnering Agreement (SPA) have been identified by Oxford City PCT:

• each Participant to appoint one representative to act on its behalf;
• a close working relationship between the parties, respecting each others roles and responsibilities;
• best value for money operational performance within agreed timescales;
• business and cultural processes to enable the parties to agree and achieve mutual objectives (set out in the SSDP and LIFTco Business Plan);
• monitoring to identify and overcome partnering weaknesses, and develop strengths;
• early identification and resolution of differences and disputes in a ‘no surprises’ environment;
• senior co-ordinators from LIFTco and each Participant to support and promote the SPA;
• transparent information and data sharing;
• positive promotion of equal opportunities by combating discrimination on the grounds of race, sex, disability, nationality etc; and
• the commitment of the parties to continuous improvement against qualitative and quantitative targets set by the Strategic Partnering Board (SPB).

12. The proposed Partnering Agreement provides for a partnership established for an initial 20 years, with the option to extend for 5 years thereafter.
13. Advantages to this Council of engaging with LIFT through the Strategic Partnering Agreement are:

• Supports joint service planning and development and integration of service provision between Local Government and Health;
• Potential savings in bid cost (for capital work);
• Schemes can be ‘bundled’ which may otherwise not have been viable;
• Provides different levels of participation for Local Authorities.
• The LIFT procurement method is being adopted for other local government services e.g. schools, waste and housing.

14. The first tranche of LIFT projects includes a new East Oxford Health Centre on Manzil Way (Dec 2005), and a new Health Centre on Dunnock Way for Blackbird Leys and Greater Leys wards (June 2005), both replacing existing health centres. This includes planned space for the integrated Intermediate Care Support Services, together with Social & Health Care staff in Community Rehabilitation Service and Rapid Response and Re-ablement. The third scheme included in the first tranche is the development of a City Centre primary health care facility, envisaged to be on the Radcliffe Infirmary site.

Future schemes

15. Several localities have been identified for possible further joint working in terms of specific local needs, including South Oxford, North Oxford, Rose Hill/ Littlemore, Temple Cowley and Wood Farm.

Options open to Oxfordshire County Council

16. Involvement options at 4 levels are set out in the Annex to this report. It is proposed that the Council should adopt Level 2 involvement, participating in the Strategic Partnering Agreement, but without exclusivity.

Financial and Risk Implications

17. The proposed option has no potential financial or risk implications for the County Council.
18. LIFTco is owned by its shareholders and performance managed by the Strategic Partnering Board and is the vehicle for the financial arrangements ie transfer of financial risk and raise the necessary finance. The Council has no involvement with LIFTco and therefore has no share of any financial or other risks.
19. The signatories of the SPA have the responsibility to appoint a Participant‘s Representative who will attend the board meetings. The potential financial implication for the County Council as participant would occur if the funder seeks a new project to be developed beyond stage 1. The implication lies within approved development work performed by the LIFTco within stage 2 without proceeding to stage 3.

Review by Head of Legal Services

20. Legal Services are currently going through the proposed LIFT Partnering Agreement to ensure that there are no liabilities for the Council in signing and being bound by the terms of the Agreement. His conclusions will be reported at the meeting.

RECOMMENDATIONS

21. The Executive is RECOMMENDED:

1. that the County Council be a signatory of the LIFT Strategic Partnering Agreement and become a member of the LIFT Strategic Partnering Board, on the basis that this will be without exclusivity (as set out against level 2 in the Annex to the report) and without financial commitment or share of risks (as set out in paragraphs 17-19);
2. that the Director for Social & Health Care:

1. be authorised, in consultation with the Solicitor to the Council, to agree and finalise the terms of the LIFT Strategic Partnering Agreement on the part of the County Council;
2. be appointed as the County Council’s representative on the LIFT Strategic Partnering Board.

CHARLES WADDICOR
Director for Social & Health Care

Background Papers: Draft Strategic Partnering Agreement

Contact Officer: Hugh McGarel-Groves, Business Manager – Tel: 01865 815565

March 2004

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