ESTATE SUPPORT SERVICE
GUIDE TO THE
CAPITAL PLANNING AND MANAGEMENT
PROCESS
December 2006
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1
A Summary of the Background and Purpose of the Guide
The Guide to the Capital Planning and Management Process is a high level
summary of capital arrangements and provides guidance on the capital and
major project planning process. It contains the governance, reporting structure
and working arrangements, and draws together key documents about the
capital plan decision making process, including levels of financial authority,
the business case process and major capital project steering group
arrangements, with reference to capital procedures.
Appendices include the business case template (also available on the web)
and major capital project steering group documents. Electronic investment
appraisal spreadsheets are available through faculty/service accountants.
Capital procedures are available from Estate Support Service (ESS). (They
are not included within this document as they are constantly developing and
subject to continuous improvement review).
Clare Rogers
Director, Estate Support Service
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Contents
1.
Capital Plan & Business Case Proposal Process
2.
Capital Projects
a)
b)
c)
Summary of Capital Project Steering Group Arrangements
Financial Arrangements
Estate Capital Procedures Guidelines
Appendices
A.
B.
C.
D.
*
Business Case Assessment
Capital Development Steering Group - Terms of Reference, Reporting
Structure and Membership
Naming of New Buildings
ESS Capital and Major Projects Procurement Procedure
Investment appraisal spreadsheets (available from Finance)
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1. CAPITAL PLAN & BUSINESS CASE PROPOSAL PROCESS
Capital Plan & Business Case Proposal Process
FACULTY/
SERVICES
PLANS/
PROPOSALS
Faculty/ESS
liaison
BUSINESS CASE
(Outline or
detailed)
EXECUTIVE
BOARD
FMBSG
CONSULTATION
WITH EB
MEMBERS
COUNCIL
COUNCIL
FINANCE
COMMITTEE
Outline Business Case
Concept Business
Case
FMBSG
EB
Detailed Business Case
Detailed
Business Case
FMBSG
EB
Council
1
An idea for a project from an academic or professional services Unit is
endorsed by the Faculty Executive Board (or Registrar) on the basis of
its strategic priority to achieve University mission and objectives and
included in the Faculty (or Central Services) Plan.
2
The Pro Vice Chancellor (Planning and Resources), Executive Director
of Finance, Director, Estate Support Service, in consultation with the
Faculty project PVC/Registrar, informally consider the proposals which
can be added to the Major Projects List annually by agreement of the
Budget Setting Group or considered on an ad hoc basis as necessary
throughout the year.
Note: New projects with major strategic impact can be considered on
their merits and in comparison with projects on the approved list during
the year, although this should be the exception rather than the norm, as
the Plan needs a minimum 2-3 year horizon and stability so that
projects can be prepared in good time and false expectations are
avoided. Costs will be more certain when there is sufficient time to
develop briefs and costings
The Estate Development Options paper sets out timed projects.
Periods will be either short term (approx up to 3 years, most are
effectively live projects and therefore already in the approved capital
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programme), medium term (approx 4-6 years) and long term (approx 610 years).
Timescales will initially come from faculties and services as they put
proposals into their plans, and later be refined in business cases and
by the overall availability of finance.
3
The Major Projects Plan ( is decided by Executive Board and Council.
A Council Members’ Special Interest Group considers overall strategic
direction. Criteria for inclusion and prioritisation include fit with
University Vision 2021 strategic objectives; impact in delivering Faculty
strategy; affordability; and fit with Estate Strategic objectives and
targets..
Business cases and investment appraisals for high priority projects
over £500k are individually submitted to FMBSG for consideration. A
business case and investment appraisal is required for projects over
£250k. The Faculty Executive Board can decide on projects up to
£500k that will be Faculty funded. FMBSG will approve projects
between £500k and £1 million. Projects over £1m must be approved
by University Executive Board, and over £2m by Council.
Note: progressing priority projects to robust business case stage
Involved significant resource from clients, Finance and Estate Support
Service and should not be done lightly, to avoid abortive costs and
distraction from other projects. (see 6c below).
4
FMBSG makes recommendations to EB (for projects over £1m), and
EB makes the decision whether to proceed further. Judgements are
not made purely on financial or estate considerations, as academic
importance is integrated in the decision making throughout.
5
The preparation of a business case is an iterative process. The first
stage would focus on the concept being proposed and it would be
expected that at this stage income and expenditure figures would be
high level estimates only. The approval route for concept business
cases would be through FMBSG & EB with the clear purpose of
deciding whether the scheme can proceed to a more detailed stage.
For each proposal the following should be addressed within the
process:(a) Fit with University, Faculty and Services key priorities (whether
the project delivers mission objectives; whether to include in the
Faculty or Central Services Plan (decision by
Faculties/Registrar).
(b) Relative importance and affordability and fit with Estate Strategic
direction as set out in the UK Estate Development Options
2012-2020 paper (approved by Council March 2012)( FMBSG).
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(c) Financial viability needs to be examined in 2 stages:
Initial stage with ‘order of costs’ and indicative outputs
(Faculty/Central Services and FMBSG )
For projects over £2m EB approval will be required for
some outlay of costs to reach this stage.

If favourable decisions are made on all the above, more
resource will be invested in developing the scheme to
outline stage so it can be coasted, while refining financial
output data (FMBSG, Estate Committee) in order to
produce the business case.
6
Finance Committee agrees the financial envelope within which the
Plan is to be developed.
7
When Council has approved the Major Projects Plan, the highest
priority University funded/ programme funded projects are actively
progressed to their individual programmes. On approval, all major
projects (usually over £2m value) will either have their own Steering
Groups and be managed according to the Steering Group
Guidelines, or smaller projects may be overseen by a Steering
Group dealing with a range of projects. A key issue is controlling
scope creep, protecting contingency and preventing virement of
savings.
8
Capital procedures are available from ESS and those with key client
side roles will receive training to explain the project management
process. Client ownership and sign off at key stages is important.
9
Following the completion of the capital stage of the project, there
will be a post expenditure review (which should be light touch if it
has gone according to plan).
10
A Post Occupancy Evaluation (to determine whether facilities meet
the brief and to learn from the project) is normally carried out when
the building/facility has been occupied for a year. This will be
arranged by the ESS Project Manager (in order to promote
ownership), and in full consultation with the client/occupiers.
11
Post expenditure review of the delivery of the financial outputs as
per the investment appraisal will be carried out at the completion of
any specific build and or purchase and at future years within the life
of the investment appraisal. While this will depend on the outcomes
expected from each project, mandatory points are after two and five
years following the initial review. These are important milestones
and the feedback should form an integral part of future project
assessments.
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2.a
CAPITAL PROJECTS STEERING GROUP ARRANGEMENTS
All projects of over £2m in total value (including equipment) should have a
steering group.
The membership, remit, terms of reference and reporting for major projects is
standardised to ensure adequate control of projects.
This set of documents is designed to be a template and guidance. They
include:1.
2.
3.
The governance and reporting structure for steering groups (chart).
Model terms of reference for a steering group.
The membership roles of a steering group and key aspects of remit
(organogram).
NB. The sponsoring principal budget holder is responsible for funding
any cost over-runs.
Chairmanship of Steering Groups – projects under £10m should normally
be chaired by the PVC of the Faculty. For projects over £10m the Chair must
be independent of the Faculty or Service. This takes effect from outline
business case approval stage. Any individual whose remit is directly
concerned with the project should not chair that particular project steering
group.
Reports – There are three main levels of reporting:
1)
Individual Projects – detailed project reports to Steering Group from
ESS/Finance.
2)
Strategic – FM&BSG summary report to Executive Board (which
should be high level).
The Sponsor must ensure that a ‘Client’ project manager/coordinator is
appointed for all major projects to ensure the client brief and business case
are delivered by the various service providers involved.
2.b
FINANCIAL ARRANGEMENTS
Decisions affecting cost – Decisions must be escalated to Executive Board
and Financial Monitoring & Budget Scrutiny Group if:
-
variations are proposed after Stage D (none should be allowed)
variations between Stage C-D (should be insubstantial)
any changes to agreed budget/funding – whether the project is over or
under budget, as savings will be reallocated in accordance with Capital
Plan priorities.
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The Chair of the Group is responsible for escalating these issues.
HEFCE CAPITAL FUNDING
HEFCE capital funding is an integral part of the overall capital plan. Any
reallocation or surplus will be applied to approved Capital Plan schemes only.
It is very important that Faculty projects have a clearly identified vision and
objectives at an early stage to ensure that the project stays within the original
estimate (based on an area cost). This is so that projects can be progressed
in a professional manner within the timescale allocated by HEFCE for the
spending of HEFCE capital.
RISK CONTINGENCY
The level of risk contingency within any scheme must be clearly identified at
the outset. At the early stages of a project the risk contingency (usually
calculated as a percentage) is set aside against unknown risk. This is highest
at the outset when there is little or no design development and decreases as
risks are identified and evaluated. As the brief is firmed and the project
moves to scheme design an outline costed risk register will be produced. It is
important to understand that project estimates are simply that,
estimates, until a project can be fully described and the risks identified;
this is normally at scheme design (stage D of the RIBA plan of work),
when a true budget can be confirmed.
Initial budget sums will be net of risk contingency and any decisions on the
use of risk contingency must be made by the Capital Projects Advisory Group.
BUSINESS CASE PROCESS
The first stage of any proposal for a project must include a timetable for key
business case stages, to include:
-
information gathering (including feasibility study/option appraisal)
business case production
investment appraisal production
dates of review and presentation through FMBSG, EB, Council
Key ESS staff (Director, Head of Capital Development or Project Manager)
will be invited to FMBSG where significant estate costs are involved. This
should apply to other key stakeholders e.g. ISS.
For each business case a group, involving the Project Sponsors (Faculty and
School or Central Services), Finance, Estate Support Service and any other
key stakeholder, must carry out a thorough challenge of all data before
proceeding to FMBSG. Adequate time must be made within the timetable for
this to occur.
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An annual business case programme will be produced by Planning and
Finance on behalf of FMBSG each May to cover the following financial year.
This will be based on the known planned projects and be undertaken in
consultation with ESS and Faculties. At this point the timetable would be
established and agreed.
The programme will reflect the outline/detailed approval stages coordinated
with the appropriate design/planning permission stages for major
infrastructure schemes.
It is the responsibility of the proposer of a project to supply all relevant base
data e.g. evidence and justification of future outcomes. It is the responsibility
of the group suggested above to critically assess the assumptions and
justification made by the proposer of a project before anything goes forward to
FMBSG. Adequate time must be made within the timetable for this to occur.
A formal authorisation/signatory process is required with signatories
certifying that information is correct and that project costs are robust and
outputs are deliverable. The signatories will be the Project Sponsor (usually a
PVC or the Registrar), Director of ESS and Director of Finance.
2.c
PROJECT MANAGEMENT PROCEDURES
ESS maintains a Capital Procurement procedure (Appendix D) and Capital
Project Management procedures. The latter are internal processes used for
all capital projects. They are live documents subject to continual
improvement. For further details please contact the Capital Team Manager.
The Project Management procedures are also intended to help services other
than ESS understand and be a necessary and integral part of the decision
making process within a project (e.g. Safety Office, ISS, Procurement,
Finance, etc).
The pre-contract (before start on site) procedures are being trialled. The
procedures follow the Royal Institute of British Architects (RIBA) processes
and have gateway sign-off mechanisms at key points within the life of the
project.
These stages are as follows:




B - Briefing Stage
C – Outline Design State
D – Scheme Design Stage
Tender Stage
Steering Group gateway approvals of sign off at critical stages within the
design process relate to these.
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Appendix A
Business Case Assessment
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Business Case Assessment Principles
The University recognises that a structured process for the review and authorisation of
Business Case proposals is necessary and as such requires that anyone wishing to
develop a proposal with estimated expenditure of over £250k completes both the
Business Case and Investment Appraisal documentation.
All proposals with an estimated expenditure of over £500k will, in the first instance, be
reviewed by FMBSG who will maintain a live business case log, before progressing
through the University management system for authorisation. Proposals should be
submitted to the Secretary of FMBSG. University Committee meeting dates are published
in the University Business Diary. N.B. The Principal Sponsor is expected to attend a
specified meeting of FMBSG to present their proposal.
The following principles should be noted when submitting Business Case proposals:

FMBSG will review outline submissions and will offer advice on how
proceed.

Estimations must be realistic and must not be determined on the basis of
avoiding authorisation boundaries. Similarly, larger projects must not be split
into a series of smaller proposals.

Contingency assumptions should be clearly stated and evidence of sensitivity
analysis should be provided.

Positive net present value from Investment Appraisal is no guarantee that a
scheme will be authorised, similarly a negative net present value does not
mean that a project will not be supported.

The University rate of return will not be absolute, differential rates will be
accepted.

The discount rate will be determined and reviewed annually (in May) by
FMBSG.

Sensitivity analysis should be conducted on each project to show the impact
on income and expenditure flows plus and minus 10%.

Expenditure which exceeds a boundary level will be subject to review by the
next highest authority level.

Proposals over £250k require a Steering Committee. For projects over £500k
the Steering Committee should be chaired by the appropriate Faculty PVC.
Steering Committees report to Executive Board on a quarterly basis. Project
Steering Groups should report estimated final costs to FMBSG on a quarterly
basis until project completion.
to
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
All projects should be subject to a post-expenditure review. FMBSG will
consider each review and will pass any serious issues up the chain of
management to Executive Board, Audit Committee or Council, as necessary.
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Authorisation Levels and Processes
FACULTY
Where sufficient funds are
available,
Faculties
may
authorise individual projects
with estimated expenditure up
to a maximum level of £500k.
FMBSG
All projects with estimated
expenditure over £500k must,
in the first instance, be
submitted to FMBSG. FMBSG
may authorise projects with
estimated expenditure up to a
maximum level of £1m.
EB
Following scrutiny by FMBSG,
EB may authorise project
expenditure up to a maximum
level of £2m.
COUNCIL
Council will be notified of all
projects approved by FMBSG/
EB. Following scrutiny by
FMBSG/EB,
Council
(or
Chairman of Council acting on
Council’s
behalf*)
must
authorise expenditure at over
£2m.
* Refer to Council Minute 73, May 2006
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Business Case Assessment
Title of Proposal: …………………………………………………..
1
Brief Description of
proposal including key
objectives.
2
Drivers / needs identified as
giving rise to proposal (i.e.
statement of requirements).
The requirements must be
clear and fully agreed by all
authorising officers.
State clearly how this
business case proposal fits
into the overall strategic
direction of the University
and other plans.
Reference should be made
to:
a. The major aims and
objectives of the University.
b. The University strategic
plan.
c. The Capital and
infrastructure plan.
d. Major Funders. How does
this proposal fit with the
Strategy of its funders?
3
4
State clearly the key
benefits / outputs and
deliverables from this
proposal.
5
How will the proposal be
undertaken?
Describe alternative options
available and whether these
have been explored.
6
Boundary with others.
What are the dependencies
and impacts both internally
and externally to the
University. Describe any
implications of this project
in terms of Information
Technology and or
Information Systems and
Services (ISS).
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7
On-going Revenue impact.
Please summarise the
impact of this proposal in
terms of revenue income
and associated expenditure
on an on – going basis.
8
Does this project give rise
to any ethical issues that
EB should be made aware
of.
9
Timescales: What are the
timescales and deadlines
for the proposal?
Who is the Project
Sponsor?
Who is the Project
Manager?
Key Financial metrics:
Taken from detailed
Financial Summary.
10
11
12
13
Value for Money.
State clearly how value for
money has been taken
account of in this business
case proposal Reference
should be made to: Industry
Standards / Benchmarks
etc.
Risk
14
Financial Summary
15
Assumptions &
Sensitivities
16
Decision Required.
What decision is being
requested at this point in
the proposal development?
Value of project for which
approval is requested?
17
Number of years
included in Financial
Appraisal
Project Funding
£000’s (Relevant
Sources only)
Base Case NPV
Total Project
Expenditure £000’s
Addition / Reduction
in space as a result
of Project (square
metres)
Gross construction
cost per square
metre of new build
/ refurbishment
projects
Number of years
Project achieves
Payback
Base Case IRR
A Risk register clearly highlighting Risks, Mitigation measures
and the owner of each risk must be included as an appendix.
A Financial summary must be included as an appendix.
This must clearly identify the cash flows, Net Present Value
(NPV) of the cash flows and the Internal Rate of Return (IRR) of
this proposal.
All assumptions must be clearly identified and sensitivity
analysis must be applied to key assumptions. These should be
included as an appendix.
A Business case Assessment is required for all Projects of Value >£250K
and All Information Technology related Projects of any value
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Post Project Audit
Review of the project is required at relevant points in time
1. At the completion of any specific Build and or Purchase
2.
At future years within the life of the investment appraisal. (This will depend on
the outcomes expected in each project). Mandatory points are at:
•
2 years following the date of the initial review in point 1 above
•
5 years following the date of the initial review in point 1 above
Basic Criteria

Initial audit
a.
Final cost of any specific Build and or Purchase
b.
Level and use of Contingency

Subsequent audits.
a.
Actual results for all expected outputs as stated in original business case.
The detail of post project audit requirements will be determined once a project is
authorised.
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Authorisation
Chair of FMBSG authorisation: _ _ _ _ _ _ _ _ _ _ _ _ _
___
Date: _ _ _ _ _
FMBSG Minute reference: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
____
Comments: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
___
________________________________________
___
_Chair
_ _ _of_ EB
_ _authorisation:
_ _ _ _ _ _ _ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ _ _ _ Date:
________
__ __ _
EB Minute reference: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
___
Comments: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
____
________________________________________
___
Chair
_ _ _ _of_Council
_ _ _ _ authorisation:
_ _ _ _ _ _ _ _______________________________ Date:
_ _ _ __ __ __ __ _
___
Council Minute reference: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
Comments: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
____
________________________________________
___
________________________________________
___
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Appendix B
CAPITAL PROJECT STEERING GROUP
(for all projects over £2 million including equipment)
MEMBERSHIP & RESPONSIBILITIES
Secretary
Client Project Co-ordinator (or Executive Office for
non-faculty projects)
Ex Officio members
Chair / Project Sponsor (normally the Faculty PVC)
(For projects over £10 million must be an independent
EB member)
To be responsible for the overall direction of the project
and to ensure that the agreed budget signed off by EB is
adhered to.
Deputy Project Sponsor (if required)
Client Project Champion(s) (normally the principal
user client)
To be responsible for ensuring that full participation is
achieved in the briefing and design process of the
project and creating the necessary drive and leadership
in the user client organisation for a successful outcome.
Note: This should only be one person, where there are
more than one department involved in the project then
the Project Champion to be confirmed in the inaugural
meeting.
Client Project Manager
Normally an experienced technical person dedicated to
large projects to assist the Project Champion in day to
day operational matters. Also acts as the daily point of
contact between the client team and the Project
Manager appointed by Estate Support Service, liaising
with the Client Project Co-ordinator as necessary.
Bursar (or senior representative from Finance)
Checks monthly reportage by the ESS Project Manager,
SAP reconciliation and ensures accuracy of budget
approvals. Assists with the project business case.
Faculty Management Accountant / ESS Accountant (as
appropriate).
Head of Capital Development (or senior representative
from ESS with the ESS Project Manager) Ensures
project reportage of cost, time and risk in a timely
manner to steering group.
Head of Procurement (if required)
In attendance
Estate (ESS) Project Manager
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External design and cost consultants (by invitation
only).
Appendix B
TERMS OF REFERENCE OF THE STEERING GROUP

To oversee the management of the Capital Project and make recommendations
to Executive Board and Council where appropriate.

To ensure that delivery of the Capital Project represents value for money and
delivers real benefits to the University.

To identify and agree the critical success factors for the Capital Project and
ensure that they are realised.

To have an overview of any projects adjacent to the Capital Project or any
other projects that would affect the progress/cost of the Capital Project.

To have an overview of the wider estate programmes of rationalisations and
disposals which are dependent on the Capital Project.

To ensure that the naming of any new building is carried out in accordance
with the Naming of New Buildings Procedure and Guidelines on Naming
Opportunities in Relation to Gifts in Support of Buildings, Posts and
Studentships (attached as appendices to these terms of reference).

To keep under review:
-
The financial performance of individual sub-projects and the
programme as a whole.
-
The procurement of equipment ensuring it is to specification and
within budget.
-
All elements of individual projects (including building, furniture and
equipment) to ensure they are delivered on time and within budget.

To have overall responsibility for the management and mitigation of all risks
associated with the programmes especially disruption to ongoing activities and
assure that a costed risk register is available from scheme design stage (D). To be
responsible for programme and financial reporting (responsible person the ESS
Project Manager).

To oversee the agreed approach to the ongoing management of contingency funds
and draw down of match funding (Faculty to control contingency).

To ensure that wherever appropriate good project management practice is being
followed.
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
To ensure that there is client sign off at key gateway stages of the design process:
B Stage (briefing stage) C Stage (outline design) D Stage (scheme design) and
Tender (responsible person Project Chair).

To ensure that the correct processes are in place for a Post Occupancy Evaluation
to be undertaken subsequent to the completion and occupation of the building
(responsible person Head of Capital Development).

Decisions to be escalated to Executive Board and Financial Monitoring and
Budget Scrutiny Group if there are:
- Variations proposed after D Stage (scheme design). None should be
accepted.
- Substantial Variations proposed after Stage C.
- Any changes to budget or funding.
The Secretary to the Group is responsible for escalating the issues.
Proposed meeting frequency:
The Group will initially meet on a monthly basis however this will be reviewed by the
Chairperson and the frequency amended to suit the business need. The meetings will
be arranged through the relevant Faculty.
Reporting:
Full reporting on progress against programme, cost against budget, risk monitoring
and key issues. Responsible person - ESS Project Manager. Report to be circulated at
least three working days in advance of the Steering Group.
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Appendix C
Naming of New Buildings
Currently, the process for naming new buildings is that names must be
submitted to Executive Board for approval, after which they are formally
approved by Council. There are no approved guidelines for the process prior
to the point of submission of information to Executive Board (EB).
At the present time, the University is investing in a significant amount of
capital development. The names of new buildings have the potential to reflect
our aspirations as a University, and the appropriate and timely naming of new
buildings is part of the communications and publicity strategy for estate
developments in addition to supporting signage and mapping issues identified
in the Wayfinding Strategy.
This document makes recommendations for the process and timescale for the
naming of new buildings, including provision of guidance with regard to criteria
to be considered.
1. Process for naming new University buildings:
All University capital development projects valued at over £2 million have
a Project Steering Group. The Project Steering Group is responsible for
ensuring that an appropriate name is selected and submitted to EB for
approval. In future, this responsibility will be added to the model Terms of
Reference which exist as part of the Capital Management and Planning
Guidelines. This responsibility includes:
a. Ensuring that appropriate consultation takes place on building name
proposals, with reference to the example criteria provided below. It is
left to the discretion of the Project Steering Group as to the breadth of
the consultation, depending on the specific factors associated with the
capital project.
b. Ensuring that the criteria for recognition of philanthropic/donor are
met, if relevant.
c.
Ensuring that a new building name is approved no later than six
months prior to a new building being ready for occupancy. This is so
that University mapping and signage can be updated in good time, and
also to maximise any relevant publicity opportunities. It should be
noted that EB approval of proposals should not be assumed.
Therefore it is recommended that proposals be submitted to EB eight
months in advance of the building being ready for occupancy, with a
supporting case.
d. With regard to the naming of rooms/spaces within buildings, approval
should be sought from the relevant Faculty Pro-Vice Chancellor or the
Registrar, and the timescale should be linked with the project plan for
internal building signage. When naming rooms/spaces, the categories
outlined below should be used as a guide.
2. Guidelines for naming new buildings
Most of the building names at Newcastle University fall into three
categories: names which reflect the University’s historical development
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and/or recognise outstanding academic or leadership contributions;
names which recognise philanthropic donor involvement; and names
which recognise functional use. Guidelines for issues to be considered in
each of these three categories are listed below.
a. Choosing a name to reflect the University’s historical development
and/or recognise outstanding academic or leadership contributions to
the University. University examples include: Herschel Building;
Bedson Building; Merz Court; Cassie Building; Drummond Building;
Armstrong Building; Stephenson Building; Daysh Building; King’s
Gate; Devonshire Building (linked to location).
Consideration should be given to the following points:
i. Naming a building after a person - the individual concerned should
be recognised nationally or internationally with regard to academicrelated achievements which should be relevant to the capital
project. Appropriate liaison should take place with any relevant
trusts, family or other authorities, if relevant for permissions to be
granted but this should only take place after EB approval, and this
should be taken into account for planning and timescales.
ii. Naming a building linked to the University’s historical development
- there should be a rationale to support the proposal which is linked
to the overall status and reputation of the University.
b. Naming a building to recognise philanthropic/donor involvement.
Specific guidance is provided by DARO in the document ‘Guidelines
on Naming Opportunities in Relation to Gifts in Support of Buildings,
Posts and Studentships’ (attached as Appendix B (i)). In summary, a
building should only be named after an individual donor if the value of
the contribution exceeds a minimum of 50% of the cost of
construction and with the agreement of the individual (or organisation
representing the individual) concerned.
c.
Naming a building to recognise functional use. University examples
include: Sports Centre; Agriculture Building; The Music Studios. It is
expected that a building will not normally be named and associated
with a particular activity, subject or discipline unless the facilities
based in the building are inextricably linked with the subject, discipline
or activity. In this way, the University aims to ensure that names do
not become irrelevant and out of date in the future (NB the Agriculture
Building is one example of a name which has remained in use despite
changes to the activities within the building, but this should be seen
as an exception).
Anne Coxhead, Head of Marketing and Publicity,
Marketing and Communications Directorate
9/04/10
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Appendix C (i)
Guidelines on Naming Opportunities in Relation to Gifts in Support of
Buildings, Posts and Studentships
It is important for the University to give appropriate recognition to individuals,
corporations, and organisations whose generous contributions help support
the University. Therefore offering the donor the opportunity to name spaces
on campus, posts or scholarships, either after themselves or in memory of a
loved one, are now part of our formalised stewardship guidelines.
1. Recognition for donors where gifts are made towards the cost of that
building: Some donors may shy away from the idea of having their name
on a building or part of a building, others may be interested in this as part of
a package of recognition; in this scenario proposals should follow the
process of submission for approval from EB and in some cases Council.
As a typical guideline, in order to name a building in recognition for a gift
towards direct construction costs, the value of that gift should meet at least
50% of those costs. Clearly 100% is highly desirable, and in some cases
may be necessary (e.g. where no other sources of funding can be identified
and the University is not in a position to meet any shortfall).
2. Naming of Buildings in recognition for activity-related gifts: Buildings
might also be named in return for benefactions to support academic activity
closely related with the building, this might be appropriate where an
individual or company has provided significant funding towards Chairs,
Fellowships, Studentships etc. in academic areas closely associated with a
new building which is funded from other sources.
3. If the majority of Building costs are met from public sources: A
potential complication arises where the majority of funding for a building
project comes from Government or other public sources but where the
University still needs to find a significant balance from its own or private
sources. In theory we should be looking for a gift of 50% of total and it is
recommended that the 50% naming guideline however under these
circumstances the percentage guideline might be reduced from 50% to
33% of the full cost of the building. Where the 33% minimum guideline
cannot be met by the principal private donor, recognition could be provided
through naming of elements of the building (foyer, lecture theatres, other
widely-used areas), together with other recognition/stewardship elements.
4. Naming of buildings on non-philanthropic criteria: None of the above
prevents the University from deciding to name buildings or important areas
within buildings in recognition of those who have made outstanding
academic/leadership contributions to the University, or indeed for a
combination of leadership and financial support. In some instances the
case for support on leadership grounds may override any consideration of
recognition for benefactors. In others this might be considered where a
benefactor cannot be identified
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5. Naming of Posts/Scholarships: For newly created posts it is
recommended that naming rights be offered where gifts meet 100% of the
direct salary; consideration should be given by EB to whether this should
also include pension cost and other support costs and overheads. This
guideline should ensure that the clear majority of costs are being mete long
into the future in return for a named position. Where a long-term
endowment to cover 100% of the salary is not possible for the donor at the
outset, renewable five or ten-year naming agreements based may prove an
attractive alternative
In scenarios where a school would like to name a post in recognition of
those who have made outstanding academic or leadership contribution to
the subject, or in recognition of a combination of leadership and financial
support, the case for support on leadership grounds may override any
consideration of recognition for benefactors.
Scholarships: Naming of Scholarships and Studentships need only cover
part of the costs of tuition and maintenance costs, as agreed between the
donor and the University. The Development Office or Finance Office can
offer advice on the level of donation necessary to establish expendable or
permanent endowments. Where a long-term endowment to cover the
annual scholarship awards is not possible for the donor at the outset,
renewable five or ten-year naming agreements may prove an attractive
alternative.
6. ‘Benefactors Clubs’ and the Armstrong Circle
The University does not currently operate a network or grouping of high
level donors, in part this is due to the small numbers of major donors
giving at a significantly high level to make such a grouping viable. Two
Circles in development include the Armstrong Circle, for donors who have
pledged a gift in their Will (no minimum level), and the Dean’s Circle for
gifts to the Medical School.
All donors are currently acknowledged on an annual basis within the
University’s annual philanthropy report Advance and through an on-line
‘Roll of Benefactors’.
Mary Haworth, Deputy Director of Development, March 2010
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Appendix D
NEWCASTLE UNIVERSITY
ESS CAPITAL AND MAJOR PROJECTS PROCUREMENT PROCEDURE
1.
Introduction
This procedure sets out the process to be followed when procuring capital and
other major projects with a value in excess of £250,000. Projects with a
value below £250,000 will be procured in accordance with Newcastle
University Purchasing Procedure.
The aim of this Procedure is to ensure that the University purchases goods
and services in a manner that is compliant with Financial Regulations;
provides value for money for the University as required in the University’s
Value for Money Policy; and meets all of the legal and funding requirements
placed on the University.
2.
Purchasing Requirements
Where the contract value is in excess of the EU purchasing thresholds,
£3,600,000 (ex VAT), a formal EU tender should be conducted with the
involvement of Purchasing Services staff.
It is the responsibility of Purchasing Services to place an advert in the Official
Journal of the European Union (OJEU). The timescales without the use of a
Prior Indicative Notice (PIN) are:


Open Procedure:
Restricted Procedure

Negotiated Procedure:
52 days
37 days for expression of interest, 40
days for return of tender.
37 days
Contract Notices should be sent to the OJEU using the Achilles Notice
system. A hard copy of the Notice should be kept in the Contract file in the
Purchasing Services Office.
3.
Procurement Route
An ESS project manager will be appointed for all capital projects by the
Capital Projects manager.
All capital projects will have a project Design Team appointed by the Project
Manager. The team will be selected from the Consultants Framework. The
project will be developed in accordance with the RIBA (Royal Institute of
British Architects) Plan of Work Stages A to L and managed by a University
Steering Group.
The project Cost consultant will consider the most
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appropriate procurement options for the
recommendation to the ESS Project Manager.
project
and
will
make
a
The Project Manager and the Head of Capital Development will consider the
recommendation and, if appropriate, liaise with the University Procurement
Office. The recommendation will either be approved or amended and the
Design Team be instructed accordingly.
The procurement options available with capital projects include; traditional
single stage tendering, two-stage tendering, design and build with the choice
of using different forms of contract. The two main forms of contract are the
NEC (New Engineering Contract) and the JCT (Joint Contracts Tribunal).
This provides a number of permutations for a specific project.
4.
Tender Process
Tenders over £3,600,000 should follow EU Procurement Regulations and
should be conducted with the involvement of Purchasing Services.
Tenders should normally be obtained following a formal tender procedure.
Tenders should be requested from Suppliers using the Due North etender
system or a formal Invitation to Tender document.
Where the project value is below the EU Procurement thresholds the Design
Team will produce a tender list for approval of the ESS Capital Projects
Manager. Typically, the minimum number of contractors invited to tender
should be no less than three and no more than six. Where this is not
practicable in the opinion of the Design Team approval of the ESS Capital
Projects Manager should be obtained.
In deciding the final number of contractors consideration will be given to the
value and type of work, the construction method and the preferred
programme. For projects below the OJEU limit the Design Team will produce
a tender list which is to be approved by the Project Manager and the Head of
Capital Development.
The tender package will include a Form of Tender listing the following
information.
i.
ii.
iii.
iv.
4.1
The tender Reference Number
Name, address, contact details of the person issuing the
tender
A description of the works required
The tender return date and time
Tender Opening
The Tender should be opened after the tender return date and time indicated
in the tender document.
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Tenders received through the Due North etender system are automatically
time stamped. Hard copy tenders should be delivered to the ESS Customer
Service Office, in the tender envelopes provided, logged and securely held
until required by the tender opening panel.
Tenders should be opened by 2 people not involved with the tender exercise
(usually the ESS Support Accountant and the Capital Projects Manager). The
tenders should be date stamped, and endorsed with the name of the persons
opening the tender and the time it was opened and recorded on a Tender
Opening Sheet.
The University does not undertake to accept late tenders. Late tenders should
only be opened with the approval of Purchasing Services. A record detailing
why a late tender was opened should be made and kept on file for audit
purposes
4.2
Value for Money and the Assessment of the Tenders
i.
All Tenders should be assessed by the project Cost
manager to determine the most suitable offer to the
University. This should be the offer that provides the
University with the best Value for Money and in
accordance with the University’s Value for Money Policy.
This will normally be determined by the Price to be paid,
the Quality of the goods or services offered and the
delivery timescales.
ii. A record of the assessment should be retained for audit
purposes.
4.3
Awarding Contracts
The Project Manager will obtain approval from the Director of ESS and the
ESS Support Accountant before awarding the contract.
4.4
Managing Project
The project will be managed by a Capital Project Steering Group as detailed
in the “Guide to the Capital Planning and Management Process”.
5. Audit Records
All tenders received should be retained for inspection by Audit. A record
saying why the successful Supplier was selected should be made and kept on
file. Records should be kept in accordance with the University’s ‘Document
Retention Policy’.
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