Counting the cost of project delay

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It is a bit rich of the Heysham-M6 Link project manager to claim that TSLM’s legal challenge will delay the project and increase costs, since Lancashire County Council has been in denial ever since early 2009 that any of the numerous delays, largely brought about by the Council’s own actions, have had any effect on the scheme cost.

In February 2009, when the scheme was accepted into the Government’s programme of local authority roads, Lancashire was anticipating a start before March 2010.

The Council tried to make the Road Orders (compulsory purchase, etc) in May 2009, at which point the projected start date was October 2010: but they got it wrong and had to resubmit. By October 2009 the start date was back to April 2011.

All this is documented in emails between me and the Department for Transport. At no point in this succession of delays did the scheme cost change.

Because of the delay in issuing Orders, the Orders Inquiry which had been anticipated for March 2010 was delayed until October 2010, and it is solely because of this delay that the scheme fell foul of the Comprehensive Spending Review in May 2010.

The scheme had to be revised, and the total cost had to be reduced but the Council’s share of capital costs almost doubled from £6.4 million to £12.3 million.

At the time of the ‘Best and Final Bid’ in January 2011 the start date had gone back again, to October 2012, but because of anomalies in the way inflation was handled there was something like a £7 million shortfall in what was needed for the inflation allowance to tally with an autumn 2012 start date.

Since then, surprise surprise, autumn 2012 has come and gone, and the latest implausible start date is summer 2013: yet there has been no allowance whatsoever for this latest nine months – and counting – deferral of the start date.

I contend that a proper accounting for inflation since 2009 adds at least £10 million to scheme costs, and other anomalies could add another £5 million. Any additional costs will be borne entirely by Lancashire County Council, so the £12.3 million could easily double again.

I wonder how many Lancashire council tax payers, not to mention councillors, are aware that the Council already has a £6.5 million ‘additional risk’ contingency allocated to the Heysham-M6 Link. Equally, I wonder how many know that the entire Council contribution to this road at the time of the Best and Final Bid was coming out of the transport block grant from government for transport projects throughout Lancashire, so is funding is being diverted from other schemes to go to one short, expensive road.

Alan James

Snade Mill Cottage