O'Sullivan 'confident' on Stonehenge cost but warns over funding impasse

11/06/2019
Chris Ames

The most senior officials at the Department for Transport (DfT) and Highways England have warned the Treasury not to delay the mutli-billion funding decision for the Stonehenge tunnel.

The call came at a hearing of the Commons Public Accounts Committee (PAC), where DfT officials called for the cash for both the tunnel and the Lower Thames Crossing scheme to be provided in addition to the £25.3bn budget for the 2020-25 Road Investment Strategy (RIS 2).

Last month the National Audit Office (NAO), which reports to the PAC, pointed out that although the Government has repeatedly stated it is committed to the Stonehenge tunnel, the scheme is currently unfunded after the chancellor banned the private finance model that the Treasury had previously told it to use.

The same situation currently exists with the roads for the new crossing between Kent and Essex.

The DfT's permanent secretary, Bernadette Kelly (pictured below), said the department ‘will be making a strong case for the schemes to be funded outside the RIS 2 funding envelope’.

Highways England chief executive Jim O’Sullivan said a total of about £3bn to £3.5bn extra was needed for the two schemes.

In relation to Stonehenge, he said: ‘We have made it clear to the department that we need clarity on the funding before the end of the year.

‘We need clarity for two reasons. First, it is an international market for tunnelling and we have to keep the market engaged and interested. We need to go to the market with an engagement notice towards the end of the year.

‘Secondly, it is almost impossible to prepare a [Development Consent Order] without funding clarity.’

He added: ‘The only security we have at the moment is that we have £20m to develop the scheme…for this year. We have advised Treasury that we need another £50m next year, but we also need certainty of funding by the close of this calendar year. Highways England has no understanding as to where the funding is coming from.’

Sir Geoffrey Clifton-Brown MP asked how Mr O’Sullivan’s need for a decision this year fitted with a recent suggestion from the chief secretary to Treasury that the three yearly spending review might not be this year.

Ms Kelly said that although such a delay was not the formal Government position, ‘a one-year settlement is not out of the question’.

She added: ‘If it were, we would need to have a conversation with the Treasury about whether we ask Highways England to continue to make progress on the scheme to the same timeframe on the understanding that it would be funded.

‘We would need to take a separate decision about it, and that is exactly the conversation we would engage the Treasury in, which is: if we want this scheme to continue, and to continue in a sensible and efficient way to the current project timeframe, we cannot wait another year, or however long it takes to carry out a spending review.’

Mr O’Sullivan told MPs that nearly £1m costs preparing for private financing of the Stonehenge scheme will be lost.

However he told MPs that although the NAO report disclosed that the scheme could cost up to £2.4bn: ‘We intend to build it for £1.7bn.’

'Since we worked on this report, we are now even more confident of the costs. Some of the risks that are included in that £2.3bn/£2.4bn number we now know will not materialise, or they have become even more unlikely to materialise. We think that £2.4bn number is becoming less likely, as time goes by,’ he said.

Asked whether he was confident the surveys Highways England has now done are sufficiently complete to ensure it will not find any surprises that will considerably increase the cost, Mr O’Sullivan replied directly: ‘Yes.’

Speaking to Highways after the hearing, Ms Kelly and Mr O’Sullivan both defended the decision not to extend the tunnel at a cost of £540m so that its western portal is outside the World Heritage Site, as suggested by the UNESCO World Heritage Committee.

Ms Kelly said: ‘Firstly I think they might be asking for rather more than that and, secondly, what we are trying to do is to get a scheme that balances affordability, value for money and maximum heritage benefits.

‘I think that’s the scheme we’ve got. I think if we spent another £500m on it we’d have a much worse [benefit cost ratio] and value for money and we would have real affordability problems. We are trying to get this balance right.’

Mr O’Sullivan added: ‘And moving that portal outside the World Heritage Site carries its own difficulties. There are other important barrows and archaeological features outside the World Heritage Site. So we took those into our consideration.

‘And the other thing is the topography is different and not necessarily a simple place to put a tunnel through.’

Highways jobs

Project Engineer – Scarborough or Whitby Area Office

£24,982 to £35,745
We have an exciting Project Engineer opportunity in our Scarborough or Whitby Highways Operational office. Scarborough, North Yorkshire
Recruiter: North Yorkshire County Council

Ice Rink Manager

£29,724 - £32,757
We are looking for a friendly and approachable person to join our management team, who can... Chelmsford, Essex
Recruiter: Chelmsford City Council

Safer Spaces Digital Evidence Officers

£25.137 - £26.520
Following a redesign of the service, we are now looking to appoint a number of exceptional candidates as Safer Spaces Digital Evidence Officers. Greenwich, London (Greater)
Recruiter: Royal Borough of Greenwich

Safer Spaces Digital Evidence Supervisors

£30.585 - £31.557
Following a redesign of the service, we are now looking to appoint two experienced candidates as Safer Spaces Digital Evidence Supervisors. Greenwich, London (Greater)
Recruiter: Royal Borough of Greenwich

Environment Improvement Officer

£24,982 - £27,041 per annum
For further information on the role please click. Telford, Shropshire
Recruiter: Telford & Wrekin Council

Assistant Director - Capital Projects, Building Services, Highways and Transport

£77,862 to £93,434 per annum
You will lead a diverse range of services and will be responsible for the delivery of an ambitious and varied Capital Programme of... Darlington, Durham
Recruiter: Darlington Borough Council

Senior Assistant Engineer (Network Management)

£32,234 to £34,728
There are 2 roles available and each role will be pivotal to the Council in delivering statutory duties which fall... Wirral, Merseyside
Recruiter: Wirral Borough Council

Team Leader (Network Development)

£37,890 to £40,876
Wirral is home to vibrant, energetic and engaged communities, people who... Wirral, Merseyside
Recruiter: Wirral Borough Council

Head of Clean and Green & Leisure

£73,632 - £80,024 per annum
Are you looking for an opportunity to apply your expertise to make a real difference? Walsall, West Midlands
Recruiter: Walsall Council

Assistant Project Engineer

£27,741 - £29,577 per annum
Do you have a passion for civil engineering and construction? Telford, Shropshire
Recruiter: Telford & Wrekin Council

Clerk of Works [JE1119]

£30,451 – £34,728
We are looking for a Clerk of Works to join our expanding team, supporting the Senior Engineers to deliver on... Milton Keynes, Buckinghamshire
Recruiter: Milton Keynes Council

CPP Engineer

£19,698 to £35,745
We have developed a career progression pathway with four stages with a well-defined framework for... Cheshire
Recruiter: Wirral Borough Council

Senior HSEQ Advisor

£35,745
An exciting opportunity has arisen to join North Yorkshire County Council's Shared Health and Safety Service to... North Yorkshire
Recruiter: North Yorkshire County Council

Service Change Officer - Street Scene

Competitive Salary
The Service Change Team supports Street Scene in improving and delivering high quality services to... Colindale, London (Greater)
Recruiter: Barnet London Borough Council

Information and Monitoring Officer

£26,025 - £38,616 per annum depending on skills
Would you like a role in shaping the planning policies of Richmond upon Thames and Wandsworth? London (Greater)
Recruiter: London Borough of Richmond upon Thames and London Borough of Wandsworth

Senior Officer - Parking

£35,745 - £40,876 per annum
As a Senior Parking Officer (Parking Enforcement) you will be responsible for managing parking contracts relating to the issue of... Sandwell, West Midlands
Recruiter: Sandwell Metropolitan Borough Council

Senior Traffic Engineer

£39,880 - £42,821 per annum
This is an exciting opportunity for someone with excellent experience in Traffic Management and Engineering, or related discipline, to... Pembroke, Pembrokeshire (Sir Benfro)
Recruiter: Pembrokeshire County Council

Principal Highway Development Management Officer

£32,910
We seek an enthusiastic and experienced individual to join our small and busy team dealing with all aspects of highway development management. East Riding of Yorkshire
Recruiter: East Riding of Yorkshire Council

Transport & Parking Services Manager

£45,880 to £51,916 per annum
We are looking for a strategic, innovative, and performance-focused manager to lead our Parking Services team and as... Dover, Kent
Recruiter: Dover District Council

Graduate Bridge Engineer

£22,183 to £25,481 per annum
We are happy to consider all applicants at degree level as well as HND (level 5) higher apprentices. Taunton, Somerset
Recruiter: Somerset County Council

Highways Presents

Highways on Fridays

Register now!

Latest Issue

latest magazine issue

 

Highways England takes on tunnels

Also inside:

  • Legal analysis: What the Brexit trade agreement means for you
  • Maintenance: The heavy-duty kit making light work
View the latest issue

Latest Video