Summary
‘Estimating
and Monitoring the Costs of Building Roads in England’ (HC 426) is a Report
from the House of Commons Committee of Public Accounts looking at Department
for Transport / Highways Agency expenditure on the development of new
roads.
The Department for Transport has approved expenditure of
over £11 billion between 1998 and 2021 for the development of new and existing
trunk roads and motorways by the Highways Agency, and just under £1.7 billion
on major road schemes proposed and developed by local authorities in five year
Local Transport Plans.
Following on from a National Audit Office report
on this topic also entitled
'Estimating
and Monitoring the Costs of Building Roads in England ' (HC 321 2006-07)
published in March 2007, the Committee's report examines the steps taken by the
Department for Transport and the Highways Agency to improve value for money and
oversight of the roads programme and contracting methods and project management
capability.
By September 2006, the Agency's 36 completed schemes in the
Targeted Programme of Improvement cost 40 per cent more than estimated
initially, and for schemes still to be completed, latest forecasts indicate
that final costs could be 27 per cent more than original estimates. The main
causes for costs exceeding estimates are increases in construction costs,
higher than forecast land prices and compensation to landowners, inflation and
changes in the scope of the project.
The Report finds that the DfT has
not been rigorous enough in its oversight of the Agency's delivery of major
road schemes, allowing it too much latitude on delivery and cost plans, and has
failed to monitor in-year expenditure against progress and delivery milestones.
The Agency is overly reliant on consultants for project management expertise
and needs to develop its in-house capability.
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