Panel calls for brakes on multi-million new Gov HQ plan

Tuesday 09 March 2021

A panel of politicians is attempting to put the brakes on the Government’s plans for multi-million new HQ at Cyril Le Marquand House amid concerns that the proposals haven’t been properly thought through.

The Scrutiny Liaison Committee says it is concerned about the Government’s sudden U-turn from signing a 25-year lease on a new head office on Broad Street to looking at a new Dandara build at their former premises, and wants time to thoroughly assess whether the chosen option is the right one before money is spent on it.

They say they should be able to complete a review of the office project by June 2021, resulting in a report that will be presented to States Members to consider. Whether the project then goes ahead should then be put to a vote in the States Assembly, the panel argues.

But Government officials are pushing back on the idea, warning that any delay to the project while a review goes ahead could cost up to £1m a month.

In mid-January, Infrastructure Minister Deputy Kevin Lewis made an official decision to sign a lease with the LMN Investments Limited, the owners of 31-41 Broad Street, just down the road from their current temporary headquarters.

But, just days later, the Government backed out of the agreement, citing “last minute and unexpected commercial issues”.

Pictured: The Government abruptly pulled out of its original plan for a new HQ at Broad Street.

One month later on 16 February, the Government pivoted, revealing its new preferred location as Cyril Le Marquand House, which was originally due to be replaced with housing, retail outlets and cafés or a public art space.

Under the plans, the Union Street office block will be knocked down to create a new development of roughly 10,500msq with space for 1,780 staff opening in 2024. Jersey Property Holdings’ Director, Tim Daniels, previously told Express that the Government had been looking at a 11,000sqm premises, but that it was re-evaluating its spatial needs in light of the pandemic’s effect on work from home habits. 

While the Government will retain ownership of the land, Dandara, working through ‘Jersey Office Developments (1J) Ltd’, will fund the construction of the building and own it.

“On completion, the Government will occupy and rent the building for an initial (maximum) three-year option period, during which time the Government may choose to buy the building. If the Government does not choose to buy the building during this option period, the Government will then rent the building from the developer,” a spokesperson explained.

Express understands the option was among the costliest of those considered by Government, which included a suggestion by the Jersey Development Company to construct a third IFC building.

The Government, however, says that building there will result in operational savings of up to £7m a year. In a covid-related press conference on Friday, the Chief Minister suggested the new HQ would be a keystone project in the Government’s bid to reenergise the economy after the pandemic. 

Video: The Chief Minister said last week that the new office could be a source of economic stimulus (from 52:33).

Normally, Government property transactions pass within 15 days of being announced if there is no challenge to them, but scrutineers said that they would not be able to complete an “appropriately informed review to this timeframe."

“The Minister for Infrastructure has presented two recommendation reports to the States within six weeks referring to two completely different conclusions on a significant project. The decision making which constituted this change therefore requires an independent review as the detail has not been assessed and the government has therefore not been held to account,” the panel argued in a report explaining their bid to probe the Cyril Le Marquand office plans in-depth.

“Due to commercial sensitivities only certain information can be provided to the public and without scrutiny this provides no assurances that Government has been effective or accountable to its actions to the Public to which it serves.”

They added that they want assurances that there are “robust controls” on the project, and that the Government leaders are capable of “strong public finance management.” 

The panel also said it was important to understand how the Cyril Le Marquand decision fitted into a number of other Government strategies, including the Island Plan, Carbon Neutral Strategy and its Estate Management Strategy.

The latter was a plan the Government’s spending watchdog urged officials to draw up back in 2018 amid concerns that it wasn’t properly managing or maintaining its £1bn property portfolio.

Pictured: After staff vacated the Cyril Le Marquand building in 2019, it was earmarked for housing or retail/hospitality space.

Express understands a property strategy was finally approved by Ministers in December 2020, but the document is still yet to be made public, despite pushes from the Public Accounts Committee (PAC).

In response, PAC launched a new review two weeks ago, aiming to establish whether the Government has demonstrated “coherent and ‘joined up’ decision-making’” in its management of its properties.

States Members are currently scheduled to debate the SLC’s review bid on 20 April, though that date could be brought forward.

Tomorrow, the Chief Minister is due to be grilled in a Scrutiny hearing on the multi-million office project among other items. 

CLICK HERE to watch the hearing at 15:00 tomorrow.