New Oncology Wing (PFI Scheme)

Concepts

• leeds
• building installations
• st james’s university hospital and the provision of related services
• ongoing maintenance of a large new wing
• pfi scheme
• build of an oncology centre
• new oncology wing
• term of the pfi
• surgical oncology
• pfi

Location

Leeds:

Description

In 2001 the Trust ran a competitive procurement process and procured a Project Co to enter into a project agreement relating to the design and build of an oncology centre at St James’s University Hospital and the provision of related services (“PFI”).

Total Quantity or Scope

The OJEU Notice published by the Trust on 18 October 2001 described the project as:“…the design, build, finance and ongoing maintenance of a large new wing for medical and surgical oncology and associated services. The project includes building maintenance services – operational services such as domestics, catering and portering are not included in the project. The supply and maintenance of equipment (including IT clinical treatment systems and PACS) will form an integral and substantial element of the project. The new wing will include linear accelerator bunkers, in-patient beds, operating theatres and critical care beds. The value of the services is not yet known. The estimated capital value of the project is approximately £136 million.” Additional information: The MES Contract is an integrated part of the PFI. The term of the PFI is 33 years and the initial term of the MES Contract is 15 years from the ‘Actual Completion Date’ of 14 December 2007. The PFI provides for a possible extension to the MES Contract in the form of a clear, precise and unequivocal review clause. Section V.2.1) below is the date of the decision to award the Main Extension

Award Detail

Renewal Options

Option to extend the term length of the managed equipment service contract (“MES Contract”) in schedule 13, clause 12 PFI Agreement.

Award Criteria

CPV Codes

• 50700000 - Repair and maintenance services of building installations
• 33100000 - Medical equipments
• 48814000 - Medical information systems
• 50421000 - Repair and maintenance services of medical equipment
• 45215100 - Construction work for buildings relating to health

Indicators

• Options are available.

Legal Justification

The ‘Equipment Term’ is defined in schedule 1 of the PFI Agreement as 15 years. The Trust’s position is that the extension to the MES contract is a permitted modification under Regulation 72(1)(a) Public Contract Regulations 2015 (as amended) (“PCR 2015”). The PFI confers an opportunity for the Project Co to deliver MES services for the full 33 years by virtue of a clear, precise and unequivocal contractual clause in schedule 13, clause 12 of the PFI, which permits the Trust to extend the ‘Equipment Term’ thereby extending the responsibilities of Project Co for the delivery of MES services.Schedule 13, clause 12 of the PFI provides that at the end of the ‘Equipment Term’ the Trust has an option to extend:“12 At the expiry of the Equipment Term, the Trust may, at its option, elect in respect of each item of Equipment to:-…12.2 extend the Equipment Term subject to agreement by the parties…”Clause 12 does not limit the duration of the extension to the ‘Equipment Term’ and the Trust considers it is permitted to extend the MES Contract to the end of the term of the PFI. The Extended Period will be on the same terms and price as provided for in the initial term of the MES Contract therefore the economic balance of the arrangement is not in favour of the MES Contract provider. The Contract Notice published on 18 October 2001 states the “33 years from financial close (although the medical equipment element is expected to run for 15 years)”. The Trust considers that this is merely describing the initial term of the MES contract whereas the project documents awarded expressly provide for the MES Contract to be extended at the expiry of the initial 15 years. Therefore, the Trust does not consider the Contract Notice to preclude the possibility of an extension of the MES Contract within the 33-year duration of the PFI.

Other Information

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