ENGLISH HERITAGE ASSET MANAGEMENT PLAN FOR THE MAINTENANCE OF THE HISTORIC ESTATE

Transcription

1 ENGLISH HERITAGE ASSET MANAGEMENT PLAN FOR THE MAINTENANCE OF THE HISTORIC ESTATE

2 TABLE OF CONTENTS 1.0 Introduction Purpose of Plan Scope and Focus Format and Content of the Plan Ownership of the Plan English Heritage And Asset Management The Role of English Heritage and the Asset Implications Asset Management Principles Overview of the Portfolio Asset Management in the Organisational Structure The Nature of Asset Maintenance The Planning Context & Strategic Direction Investment Needs, Available Funding and Allocation Processes Key Challenges in Asset Management The Strategic Direction for Asset Management Looking Forward An Overall Action Plan The role of Asset Management Performance Measurement Prioritisation of Funding Prioritisation of Funding (Issues to Resolve) Prioritisation Process Flow Diagrams... 20

3 1.0 Introduction 1.1 Purpose of Plan This Asset Management Plan (AMP) sets a broad direction for asset management over the medium term. It provides a framework for action to ensure that the important and unique National Collection of Historic Properties for which English Heritage is responsible is conserved and supported with the appropriate professional skills. The AMP is intended to facilitate rational asset decision-making based on identified needs and available funding. It is a practical tool which helps to define, implement and measure how English Heritage:- Makes its investment decisions Protects, maintains and improves its assets Ensures cost effectiveness in its property related services Promotes innovation and development in asset management Listens and responds to asset managers and visitors The plan has a 4-year time span, but is updated annually to provide a rolling plan. The plan sets the context and a programme of action for English Heritage over the medium term. It is intended for a wide audience including: The National Property Steering Group (PSG) as key decision makers on asset management matters Territorial Property Steering Groups (TPSG) - to support decisions on investment priorities in the portfolio The National Collections Group Maintenance Conservation Team & Conservation Technical Teams - to support their day-to-day role as technical advisers on the maintenance of the estate Executive Board - as the primary sponsoring body for PSG Department of Culture, Media & Sport as the primary sponsoring body for English Heritage The wider heritage sector in order to promote best practice The public as a statement of English Heritage asset management priorities 1.2 Scope and Focus This is English Heritage s first AMP and it is intended to be a document which will be updated and revised in use. The scope of assets is limited to those within the guardianship of English Heritage and excludes all administrative properties which English Heritage owns or occupies. Also excluded are considerations around the acquisition or disposal of assets. The focus of the AMP is therefore English Heritage s asset management policy relating to the maintenance of the National Collection of Historic Properties. English Heritage Asset Management Plan 1

4 1.3 Format and Content of the Plan The document is arranged in four sections, with appendices containing supporting material. Section one outlines the purpose of the Plan and its intended audience. Section two explains the role of English Heritage, its asset implications and the broad principles that shape its management action. Section three identifies and defines the key asset management issues facing English Heritage and articulates the broad strategic direction looking forward in response to these issues. Section four provides an action plan and within this sets out a framework for allocating scarce financial resources to secure best value in the protection of heritage assets for which English Heritage is appointed guardian. 1.4 Ownership of the Plan The Conservation Director, Bill Martin is the custodian of this plan and future development. Comments and feedback should be directed to Julie Swann, Head of Estates Programme Development, or by to julie.swann@english-heritage.org.uk. 2

5 2.0 English Heritage and Asset Management 2.1 The Role of English Heritage and the Asset Implications Heritage assets are an integral part of a community and its environment. They are also tangible evidence of our historical and cultural traditions and origins. English Heritage has a specific and unique role in respect of such assets by:- conserving them on behalf of the nation promoting access to them informing and educating the public about them establishing standards for others with a responsibility for heritage assets to follow English Heritage thus has a role as custodian, educator, regulator and advisor on heritage assets. The legal basis of this role was established in the National Heritage Act of It has been amplified more recently through its strategy for the period English Heritage Corporate Plan, which sets out that the role of English Heritage is to stimulate a virtuous cycle of understanding, valuing, caring and enjoying heritage assets. The Corporate Plan makes it clear that the over-riding priority is to safeguard for the future the National Collection in its care through the creation and implementation of an Asset Management Plan. 3

6 2.2 Asset Management Principles English Heritage has a set of on-going asset management objectives approved by the Property Steering Group. These objectives and the principles that support them provide the primary drivers for shaping management action with respect to the portfolio and are summarised below. In general terms English Heritage is not concerned with the acquisition and disposal of assets, but rather as steward of the important National Collection of Historic Properties to make the assets in their care accessible to the public. Overall Purpose To enhance the nation s cultural heritage through the protection of its historic assets Supporting Objectives To ensure scarce financial resources are directed to preserve assets in the most need To manage delivery of property services to demonstrate continuous performance improvement To raise awareness of asset management and provide clear decision-making over its management and use Underlying Principles There should be explicit responsibility & leadership for asset management Asset management should be a systematic and embedded process Asset management should promote consistent national standards Decision-making needs to be supported by comprehensive and current data Whole life implications of capital investment need to be recognised Asset management should be supported by performance measurement Ultimately the long term measures of success for English Heritage asset management policies are to ensure a reducing maintenance backlog for its portfolio of assets, whilst increasing the number of visitors to its sites and generating income from improved asset use. 4

7 2.3 Overview of the Portfolio English Heritage is responsible for 423 historic properties of national importance, which are distributed across England. Properties are classified into one of seven types according to their physical characteristics. Sites East London North South West Total East Bridge Earthworks or Neolithic remains Extensive or substantial remains Minor remains Minor roofed buildings Monument or standing stone Substantial roofed buildings Total Sites are sub-divided into one or more assets; with each asset being determined by having a distinctive physical (location), historical or architectural aspect, which distinguishes it from other assets on the same site. Assets are then sub-divided further into a number of elements, which are the individual building or structural components that make up the asset. Surveys to determine the condition and maintenance needs of sites are conducted at this element level and totalled to quantify needs at an asset or site level. Physical Hierarchy of Historic Properties Sites Can be sites which charge for admission, which are free and in some cases which are hidden Assets Sites can be broken down into one or more assets each with a different unique characteristics Elements Element 1 (where) Element 2 (what) Assets are broken down further into a number of elements 5

8 2.4 Asset Management in the Organisational Structure The National Collections Group (NCG) is responsible for the stewardship of English Heritage's collections of buildings, artefacts and archives, for their presentation and interpretation and for maximising their commercial potential. It has a number of challenges to meet; to ensure that the collections are handed on to future generations in as good or better condition than we found them; to position the organisation as the holder of major national collections; & to ensure that the commercial contribution made by the collections delivers the level of growth which EH needs. The Historic Properties Director has ownership of the assets and manages the day-to-day operation of the properties. The Conservation Director is responsible for technical advice on asset maintenance and provides the professional advice on estates, maintenance and conservation matters. The Curatorial Director is responsible for the presentation and interpretation of the buildings and for the care and conservation of the collections. All three Directors are jointly responsible for the overall asset strategy for English Heritage. Asset management as a strategic discipline with a national perspective on the portfolio is a relatively new area of activity. It has significant support from the Executive Board to ensure effective decision-making over the allocation of scarce capital and revenue sources. The Asset Management Team was initially established as a discrete, short-term project in 2007, with a remit to develop a centralised asset database and to undertake condition surveys of all asset defects so that there was current, comprehensive and robust data on the maintenance needs of the portfolio. The Asset Management Team reports to the Conservation Director. The existing scope of the asset management function as set out in the business case, which proposed its establishment, covers:-. Developing and maintaining effective knowledge of the condition of the National Collection of Historic Properties Identifying and costing the backlog of required maintenance for the collection Facilitating intelligent and integrated future planning for its care and maintenance. Promoting a consistent approach to the management of the collection Developing a systematic and consistent process of the prioritisation of work across the territories. Identifying future funding requirements and the risks of inadequate funding accurately Producing an asset management plan Establishing a centralised asset IT system and ensuring compatibility with existing asset related information systems. The scope and nature of the asset management function has evolved during its project life and the need for an on-going asset management function has been recognised. A definition for the asset role is presented later in this Asset Management Plan. 6

9 Organisational Structure Department of Culture, Media & Sport (DCMS) English Heritage Board Chief Executive Director of Heritage Protection and Planning Director of National Collections Director of national Advice and Information Director of Resources Conservation Director Development Director Curatorial Director Marketing Director Historic Properties Director Head of Conservation Architecture Head of Building Conservation & Research Head of Gardens & Landscape National Head of Conservation Maintenance Head of Civil & Structural Engineer Head of Building Services Engineering and Safety Team Chief QS/Head of Contracts Head of Estates Programme Development Head of Archives Head Collections Curator Head of Education and Interpretation Head of Conservation Head Historic Properties Curator Head of Interpretation Stonehenge to 2013 Head Properties Director (South East) Head Properties Director (West) Head Properties Director (East & London) Head Properties Director (North) Commercial Director National Head of Projects 2.5 The Nature of Asset Maintenance Maintenance involves repair (planned and unplanned) and routine servicing of assets and any associated plant. It is intended to be a risk management process, in that assets should be maintained to a standard that will contain, to an appropriate level, the risks associated with:- Major damage to, or loss of an asset Security of both the asset and the users Health and safety of the users Preservation of the asset s historic significance Image and reputation of English Heritage (as custodian of assets) It is recognised that maintenance represents a significant proportion of the total costs of owning and operating an asset over its lifetime (perhaps twice initial capital costs); therefore it is important that an effective maintenance policy is developed and implemented to ensure the above risks are properly managed and value for money is achieved. This policy must be underpinned by acceptance of two basic characteristics of a maintenance strategy:- Simple predictive models cannot accurately estimate true funding requirements of a maintenance programme. Historical expenditure information and asset condition data is required to determine an asset portfolio s future maintenance needs. 7

10 Whilst some maintenance activities can be deferred for a time without having an immediately noticeable effect on asset use, decisions on deferring maintenance activities cannot be made arbitrarily or postponed indefinitely. Responsible asset management demands that future liabilities be identified and appropriately managed. Annual recurrent maintenance need is typically made up of two distinct activities. These are reactive and preventative (or planned) maintenance. Reactive Maintenance involves repair of broken components which cannot be deferred, and therefore work needs to be carried out on demand to protect the asset. The level of repairs varies from one year to the next and tends to be influenced by factors such as adverse weather conditions Preventative Maintenance is work carried out on a planned basis to reduce the risk of excessive breakdown incidents, to preserve the asset and prolong its life. It can be further sub-divided Cyclical (routine) maintenance the regular inspection, testing and servicing of fixed plant and equipment Planned (restorative) maintenance the planned repair or replacement of deteriorated components, elements or systems. The relationship between the relative levels of expenditure on reactive and preventative maintenance can give a good indication of the effectiveness of an organisation s overall maintenance strategy. Annual expenditure predominantly on planned maintenance with a stable or reducing backlog trend is indicative of a well maintained portfolio, whereas a high proportion of spend on reactive maintenance would suggest a crisis or poor value situation typified by inadequate budget and a poor maintenance strategy. The National Collection of Historic Properties in the care of English Heritage is atypical of most organisations and by its very nature this orthodoxy of a balance between preventative and reactive maintenance may not always be applicable. English Heritage has funding allocations that reflect this basic split in maintenance. Minor PMP (property maintenance projects), below 50k in value and large property conservation projects, over 50k in value support both preventative and reactive maintenance needs with PIP (property improvement projects) supporting new capital projects. In general terms, preventative cyclical maintenance has first call on the available funds. 8

11 3.0 The Planning Context and Strategic Direction 3.1 Investment Needs, Available Funding and Allocation Processes The condition survey programme has enabled the organisation to understand the investment needs of the estate. The investment need to bring the estate to the required benchmark condition is circa 54 million. The breakdown is illustrated in the table by Territory. Territory Defect Cost Estimate by Priority Territory ( Total Monetary Value ) Priority WEST SOUTH EAST NORTH LONDON EAST Estate Total AMP Priority Defect 0 Urgent Monetary 1,720, ,205, , , , ,830, Value AMP Priority Defect 1 Immediate / essential Monetary 4,782, ,356, ,244, ,261, ,365, ,009, within months Value AMP Priority Defect 2 Within two years Monetary 5,445, ,388, ,340, ,868, ,299, ,342, Value Territory Total Monetary Value 11,949, ,950, ,013, ,041, ,228, ,182, This backlog estimate can be compared with the current level of maintenance spend which is in the order of 16 million per annum. Of this 4.5 million per annum has funded a programme of major conservation projects. With little prospect of any significant increase it falls short of the 10.5 million per annum estimated required to prevent further deterioration in the estate. The funding is broken down into three major streams of activity. These are; Cyclical and Response Maintenance including Minor Conservation Maintenance Projects (PMP) for smaller planned works of usually less than 50,000 Major Property Conservation Projects (PCP) for larger planned works involving the repairing of fabric of assets and usually greater than 50,000 Property Improvement Projects (PIP) for lager capital schemes involving new development such as visitor facilities. PIP tends to be for major capital projects. 2010/11 Overall Spend on Assets in 000s North South East West Total Revenue PMP PCP Total Capital PCP Total

12 Following the Comprehensive Spending Review (CSR) it was accepted that potential increased resources to tackle the 54m backlog of works required to bring the portfolio up to benchmark standard would not be available. The conservation maintenance budget available to address all cyclical maintenance, response maintenance and planned conservation maintenance as well as grounds maintenance needs has remained at 16m per annum for the last 4 years. There is not anticipated to be any significant increases looking ahead. Indeed the overall resource context for public funding is likely to be very constrained for the medium term and the risk is of less rather than more money in the future. 2007/08 Spent 2008/09 Spent 2009/10 Spent 2010/11 Spent Revenue PMP 11,150 12,394 11,428 11,781 PCP 3,901 3,874 4,118 4,421 Total 15,021 16,268 15,546 16,202 During the spending period 2007/8 to 2011/11 processes for allocating this funding have tended to work on an historical basis with funding allocated within territories based on the legacy of previous years budgets, informed by local knowledge of priorities. The allocation of funding has occurred within the Territorial Property Steering Groups (TPSGs) and then subsequently confirmed at the Property Steering Group (PSG). This position has changed with the condition surveys undertaken as part of the AMP project providing an improving base of knowledge about investment need and priorities at an individual asset level. Crossterritorial prioritisation of funding has been identified as a future requirement and this AMP presents a framework for allocating resources on such a basis. Allocation for the Next Spending Period 2011/12 to 2014/15 Revenue Cyclical & Response Maintenance 2011/12 Overall Planned Spend on Assets in 000s North South East/London West Total 1,958 2,651 2,654 2,363 9,626 Other Planned Maintenance ,033 Minor Planned Projects ,000 Major Planned Projects , ,086 Total 2,962 3,924 5,437 3,422 15,745 Capital Revenue 2010/11 Spent 2011/12 Allocated 2012/13 Estimated 2013/14 Estimated 2014/15 Estimated Cyclical, Response & 11,781 11,656 11,365 11,074 10,491 Planned Maintenance All other Planned 4,421 4,505 4,796 5,087 5,670 Maintenance Projects Total 16,202 16,161 16,161 16,161 16,161 10

13 The ongoing shortfall of funding against identified need for conservation maintenance on our estate has prompted PSG to refine the approach to allocation. In order to maximise the effectiveness of the total revenue spend of 16m, PSG has agreed to support one substantial, high impact project, to demonstrate fully the advantages of packaged procurement and delivery at the same time as exemplar standards in conservation and presentation, rather than a series of medium-sized conservation projects across the estate. For Financial Years 2011/12, 2012/13 and 2013/14 this project is at Kenwood House. Such large projects will be supplemented by a restricted number of medium-sized ones across the estate as funding allows, but the bulk of the non-cyclical conservation maintenance will be met from the allocations to minor planned works, projects under 50k, as is the case now. There will be an increasingly rigorous prioritisation at local level employing the prioritisation process detailed in the Asset Management Plan. In order to be able to invest more in the conservation repairs project programme an objective has been set by PSG to reduce the spend on cyclical budgets by 10% in real terms over the funding period. For the financial year 2011/12 the cyclical spend for maintenance is 7.6 million. The response budget will be capped at 20% of the total cyclical budget. As an example, we will explore how areas such as the Grounds Maintenance budget can be reduced, initially by piloting a new, reduced mowing regime in the North Territory and establishing a range of trials across the estate exploring the potential for increased grazing on our grounds. 3.2 Key Challenges in Asset Management English Heritage is a mature organisation with a broad range of experience in protecting heritage assets. Its processes and standards have evolved over a number of years and are also well understood. However the organisation has been subject to change in recent years which has required it to adopt a more business-like and systematic approach and move from one which has traditionally been immersed in conservation. As this process of change continues there are a number of challenges facing English Heritage with respect to its asset management policy and practice. These are:- Promoting national consistency whilst retaining territorial discretion English Heritage has a strong regional identity and traditions. Much of the local knowledge of individual sites is held by staff at a territorial level and is often deep-rooted. This enthusiasm for, and local knowledge of its asset base is a key strength of the organisation, but it may also result in sub-optimal decisions on procurement and allocation of resources. This deficiency may be addressed by an adoption of an explicit framework of national standards and procedures within which local discretion can be exercised. Maximising the value of every pound spent the English Heritage Strategy emphasises the need to use financial resources wisely in order to secure the maximum value from spend. This has significant asset management implications around the targeting of spend and the method of spend. The implication of this is the adoption of a national approach to the procurement of asset related work and the packaging up of works from individual projects to programmes of works. 11

14 Embedding systems and processes The organisation is undergoing a process of change which in broad terms is promoting a more business-like and corporate approach, which is in contrast to the more traditional, conservation-led regional culture from which it has originated. In terms of asset management there is a need to promote a systematic and systemic approach; to emphasise national consistency and standards and to provide robust support to the decision-making processes around investment. Ensuring balance between technical and conservation approaches The cultural change implied above may mean that there is a requirement to ensure an appropriate balance of differing perspectives of asset management. The promotion of consistency and standards across territories needs to be done in such a way that local knowledge of assets and the varying perspectives of assets is retained and set within a national framework. The future role of asset management There is a need to recognise and define the nature of asset management and its role within English Heritage looking ahead so that the benefits from the short-term AMP project are not lost. 3.3 The Strategic Direction for Asset Management In order to respond to the challenges identified above there is a need to promote a national approach to the stewardship of the estate whilst retaining local knowledge and discretion. This requires a prioritisation process with agreed criteria which provides the basis on a national level to determine the allocation of resources, but with the ability for this to be moderated to reflect local, conservation, operational and commercial factors. It also requires clarity around the exact nature and role of asset management as an activity within English Heritage. A broad framework for action to underpin this strategic direction for asset management is presented in the following section, which identifies some of the more immediate actions that can be adopted by English Heritage to develop asset management further. 12

15 4.0 Looking Forward 4.1 An Overall Action Plan Looking forward there are a number of actions required to respond to the key challenges identified in Section 3. An overall action plan is presented below. The resource implications and timing of these actions are not identified, but a brief narrative of the rationale and broad focus of each action is given. 1. Refine the prioritisation process. This AMP has articulated a revised prioritisation process and pointed to the need to review some of the concepts and existing arrangements. The model presented below has been endorsed by the AMP Implementation Board and helped sense-check the Maintenance Programmes developed for 2011/ /14. The outline will need to be reviewed, amended and refined as the 4 year programme for is developed. 2. Develop a data management strategy which provides a long term blue print for data needs for asset management. This needs to provide a road map of the data needs to underpin asset management (over and above the existing focus on condition data); to identify data standards, collection frequency and ownership, as well as organisational issues such as who is responsible for data collection, update and analysis. The strategy needs to embrace some of the more disparate elements of data which can contribute to asset management (such as plans and photos) and illustrate how these can be organised to support asset management. 3. Review procurement arrangements in order to secure improved value for money from asset-related work. This will be vital in order to meet the 10% saving on spend on cyclical maintenance over the spending period. The predominant pattern of procurement is one based on territorial procurement with at least small value works procured at a local level. There is a need to review existing procurement arrangements to promote an appropriate balance between national and territorial procurement and this is likely to result in a procurement strategy for maintenance activities. 4. Review Help Desk arrangements, which are predominantly locally based. The Help Desk arrangements are an illustration of the national versus territorial dilemma. Whilst providing a local and responsive service to reactive maintenance needs, the current arrangements include an element of duplication and inefficiency of resources with five separate systems requiring local effort to maintain and use. It may be that a more robust and equally effective system can be provided at a national level for recording maintenance needs, which can then be delivered locally. 5. Defining the role of asset management the asset management function was initially established on a short term, project basis. The role of asset management on an ongoing basis needs to be defined and agreed. Some embryonic thoughts on the role are presented below. These need to be amplified and agreed through PSG and subsequently widely disseminated across the organisation. 13

16 6. Develop a performance management framework an audit of English Heritage against best practice in asset management identified performance measurement as a potential area of weakness. It is therefore appropriate to develop a basic set of performance indicators for the portfolio which can be used to track the long term effectiveness of asset management against which the organisation can set improvement targets. Some initial thoughts on a possible framework for this are presented below. 7. Promoting cross-territorial flexibility the broad direction of change in the allocation of funding suggests that money is directed to where there is greatest need rather than simple allocation on a territorial or legacy basis. This may have implications for staff flexibility and implies the need for scarce technical skills to follow funding allocations. It may be appropriate to consider an initial programme of short term staff exchanges or secondments to explore this wider issue of flexible resources as part of a wider audit of organisational skills and capacity. 8. Review of training needs with the changing nature of the organisation allied with the promotion of asset management disciplines and the move towards a more national rather than territorial approach to asset maintenance it may be an appropriate time to undertake a skills audit and to identify training needs. There may be a mix of general needs; such as raising awareness of whole life cycle costings; business case development and project management; along with specific needs in asset management. 9. Planned asset replacement programme the module of the AMP IT system to record information about plant and equipment, including replacement forecasts has been populated in the AMP IT project Phase II. Further development will help with the programming of such works over the medium to long term and thus ensure more effective use of resources. 10. Develop an asset strategy for non-heritage assets this asset management plan has focussed only on the historic properties in the care of English Heritage. There are a range of other assets which the organisation uses such as offices which may also be subject to review. These have significant value, incur running costs and there may the potential to release capital or reduce running costs through more effective space utilisation. It is recommended that an asset strategy which considers these is developed. 14

17 4.2 The Role of Asset Management The existing asset management activity was established on a time-limited, project basis to manage the implementation of the new K2 information database and coordinate the collection of condition survey data. Although initially conceived as a short term project English Heritage has recognised the need for asset management as an on-ongoing, strategic activity which has a role after the completion of the initial project brief. The nature of asset management can differ significantly within different organisations and careful thought is required to scope, define and position its role in English Heritage looking forward. The table below outlines the possible scope of asset management as an on-going activity. Role Outline of Activities Policy Development of AMP (reflecting national priorities) Development of long term strategic vision for assets Policy development on a range of issues (e.g. sustainability) Information Development of an information management strategy Coordination of condition survey process Establishment of appropriate data standards Custodian of K2 database (although data collection and entry may be undertaken on a territorial basis) Data analysis (to identify trends and emerging asset protection issues) Development and monitoring of key asset management performance measures Standards Promotion of appropriate national standards PSG Support Support to PSG as the senior decision-making group on asset matters Provide challenge to priority setting and resource allocation process 4.3 Performance Measurement Whilst much of the base data required for tracking the performance of individual properties and the portfolio as a whole is available, this has not been a specific focus of the Asset Management Team. Performance measurement and the development of property performance indicators is however recognised as an area requiring further action over the short to medium term. A simple framework is recommended for use in order to provide a scorecard approach to measuring asset management performance. This based on a small number of property performance indicators (PPIs) which are chosen to provide a rounded view of the portfolio. The intention should be to track these over time and establish long term targets against which to monitor progress. The framework will need to be developed and refined in use. Targets should be set by PSG and monitored annually through the AMP. Some initial suggestions for asset management indicators are presented in the table below. These have been chosen to reflect the key measures for the success of asset management identified in Section 2.2 (page 3) and the likely availability of data. The indicators presented 15

18 are high level indicators for the portfolio as a whole rather than individual sites or assets, although it is recommended that some thought is also given to indicators that may be applicable at an individual asset level. Theme Recommended Indicator(s) Condition Maintenance backlog (U0+U1+U2) as % of annual maintenance spend Or Maintenance backlog (U0+U1+U2) as % of net annual revenue budget Cost Reduce % spend on unplanned response maintenance compared to planned maintenance to 20%. Income Income from portfolio as a percentage of portfolio running costs Outreach Total number of paying visitors 4.4 Prioritisation of Funding There are many demands on the existing funds available for maintenance and enhancement of English Heritage s assets. Following the CSR it was accepted that potential increased resources to tackle the 54m backlog of works required to bring the portfolio up to benchmark standard would not be available. A key aim of the English Heritage Asset Management Plan is to define the process and criteria for prioritising work and allocating funds to ensure that scarce resources are appropriately directed to secure maximum value for money. The broad framework for this decision-making process is illustrated schematically on the diagrams at the end of this document and the key elements of the process are described below. This process has been reviewed and endorsed by PSG and it will continue to be refined as we move forward. Prioritisation of Funding (Roles & Responsibilities) There are three main agents in the prioritisation process. These are Property Steering Group (PSG), Territory Property Steering Group (TPSG) and the Asset Management function. PSG is the final decision maker on the work programme. This group needs to be satisfied that the recommended programme of work is robust, reflects investment needs appropriately and secures value for money. Its role is to approve the work programme and to oversee its implementation. TPSG provides input to the prioritisation process at a local territorial level ensuring appropriate technical and curatorial perspectives are embraced in development of the programme. They have a role in moderating the initial draft work programme generated from the K2 database into a more robust programme of work with consideration of issues relating to historical significance, presentation and value for money. 16

19 The Asset Management function has an important role (on behalf of PSG) to co-ordinate the overall process of developing an agreed work programme with funding allocations supporting investment needs. This role can be characterised as one of leadership, coordination and control over the process coupled with national, external challenge. Prioritisation of Funding (The Process in Outline) Initial Funding Allocations broad funding allocations into the principal funding streams, maintenance, including minor planned works (PMP), major planned conservation works, and Property Improvement Programme (PIP) ensuring funding availability are identified at the outset of the financial year and from normal financial planning processes within English Heritage. It is recognised that some funding for minor planned and cyclical maintenance is effectively ring-fenced and therefore not subject to the prioritisation process. Similarly new capital projects under PIP would not be subject to this prioritisation process, although the on-going maintenance issues associated with such projects does need to be identified and considered as part of longer term value for money consideration. Draft Work Programme With the improving knowledge of the condition of the asset base through the AMP project and with the use of the K2 database it is possible to create an initial prioritisation listing of work based on analysing the urgency of work from the defects survey. At the current time the condition survey process is undertaken on defective elements only; but over time condition surveys will be extended to cover all elements. This provides a building condition / technical perspective at element level. Moderation of Initial Work Programme From the initial draft work programme there is a process of moderation. This is done on a territorial basis through the TPSG s to reflect local knowledge, the conservation perspective and the commercial or visitor perspective. It is recommended that a challenge process co-exists alongside this moderation process. This can be provided through the Asset Management function which, with the benefit of the knowledge base, can provide a national challenge to the local, territorial perspective so that what emerges is a robust programme of work. Securing Value for Money - As the initial programme of work is developed, there is a process of packaging of work to ensure best value for money is secured. This may distort rational individual project prioritisation for practical value-for-money considerations. This process is reliant on local technical knowledge, but needs to be subject to an external challenge to ensure consistency of approach on a cross-territorial basis and to ensure wider national considerations are identified. Ratification into Provisional Work Programme The initial work programme will then be reviewed by PSG and an approved draft programme created. This provides the stock of work which, subject to appropriate detail pre-project work, will be implemented. 17

20 Prioritisation of Funding (Indicative Timescales) It is intended that the work programme is planned over a 4 year period with detailed plans for the next financial year approved by PSG giving a seamless transition from year to year. However, in broad terms it can be broken down into two overlapping stages. These are:- 1 Review and refinement of a work programme on a territorial basis using the condition data from the AMP IT database (K2). This is a locally-based process undertaken through TPSGs with support and moderation by the asset management function. Firm detailed plans for work proposed for the next financial period will be reviewed and approved by TPSG during the autumn of each year. 2 Refinement of the territorial derived work programmes into an agreed national programme reflecting available funding and a robust challenge to identified priorities against investment needs. This work is more nationally focussed through PSG leading to an agreed programme of work, which is then implemented through the subsequent financial year (subject to business case approval and monitoring of delivery). 18

21 5.0 Prioritisation of Funding (Issues to Resolve) This outline for a prioritisation process implies a number of issues which needed to be considered and resolved. These were:- 1 Reviewing and explicitly defining the concept of urgency. At the time of survey it is a surveyor s composite view of the need for remedial work and its relative importance. Urgency is now defined to embrace the notion of the risk of failure and the impact of failure, which will provide a deeper grain to the initial prioritisation of work. 2 The surveys highlighted a large backlog of work with urgency ratings 0, 1 and 2. The total backlog is over 50 million and is far in excess of the funding available. A review of the elements has taken place with some elements being identified as having a higher priority than others. Priority elements have been given weightings in K2 so that they are easily identified and can be used to search for priority work. The full element lists with priority weightings is available on the SharePoint site. 3 The Minimum Standard of Repair (MSR) ratings were made available to the surveyors to inform and identify urgency of work in terms of expected presentation. It was identified that these would be of value in helping to identify priority work. The MSR ratings have now been captured in K2 at building level. They are not used to weight the priority of work, but are there to indicate possible importance of a building to aid the prioritisation process. MSR rating details are at the end of this document. 19

22 Prioritisation Process Flow Diagrams DEVELOPMENT PROCESS Moderation Priority Criteria FUNDING AVAILABILITY & ALLOCATIONS Revenue Capital Planned Maintenance PIP Prioritisation and moderation within territories through TPSG Asset management challenge to prioritisation and moderation process informed by condition data URGENCY HISTORIC SIGNIFICANCE PRESENTATION (MSR) HISTORIC SIGNIFICANCE PRESENTATION (MSR) VALUE FOR MONEY Element Building condition & technical perspective (Defect Surveys) Asset List & Other Work Bank Urgency = Assessment of Risk of Failure vs Impact of Failure Asset Site Conservation & historic perspective Curators input through Statement of Significance Visitor perspective Commercial significance + brand & reputation considerations Programmes Value for Money Review of priorities to ensure opportunities for savings through packaging of work & procurement Pre-allocated funding to cyclical & response maintenance Property Improvements Projects & Annual Site Presentation Projects National Priorities PSG Provisional work programme Agreed work Programme AMP Approval to plan Business case Approval to spend Monitoring 20

23 URGENCY Ratings 0 Urgent 1 Immediate/essential within months or a year at most 2 Necessary within two years 3 Necessary within the quadrennial cycle 4 Necessary during the subsequent quadrennial cycle 5 Necessary within the AMP cycle (9 20 years) PRESENTATION (MSR) 1 Maintenance, conservation and repair in excellent order at all times 2 Fully maintained, conserved and repaired at all times 3 Maintained, conserved and repaired to prevent deterioration and to a level sufficient to protect against risk of legal claims 21

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