I will provide Parliament with an update on some major infrastructure projects, particularly the Aberdeen western peripheral route/Balmedie to Tipperty project, which is more commonly referred to as the AWPR.
The AWPR is the longest new roads project under construction in the United Kingdom; it is also the equivalent of building a new road between Edinburgh and Glasgow. When complete, the AWPR will provide substantial benefits across the whole of the north-east by boosting the economy, increasing business and tourism opportunities, improving safety, cutting congestion and improving opportunities for public transport facilities.
The AWPR contract was awarded in December 2014 to Aberdeen Roads Limited—or ARL—which is a joint venture comprising Balfour Beatty, Carillion and Galliford Try. When I attended the Rural Economy and Connectivity Committee on 24 January 2018, I advised that the intention at that time remained to open the road in the spring but that the date could not be guaranteed. Since then, officials have been closely engaging with ARL to determine likely delivery dates for the project, so it was surprising when Balfour Beatty, one of the partners forming ARL, revealed in its 2017 full-year results on 14 March 2018 that the project would be complete in summer 2018.
Consequently, I instructed officials to arrange an urgent meeting with ARL on Thursday 15 March to seek clarity on the views that had been expressed by Balfour Beatty. Transport Scotland met ARL’s contractor on that date. At that meeting, ARL was asked to confirm formally its position on its intended completion date. On Monday evening, Transport Scotland received that confirmation. Officials instructed their technical advisers to validate the information in order that I could provide clarity to communities and businesses in the north-east on the timescale for completion of the project.
Yesterday, I received confirmation that that exercise has been concluded, and I will now provide an update to Parliament. ARL has confirmed to Transport Scotland that its target is to open the roads during August 2018. The contractor has cited delays, which it attributes to factors including the cumulative effects of weather events on the project, such as storm Frank in 2015, and delays to the timing of public utility diversions.
On that last issue, I advise that ARL is maintaining a claim against the Scottish Government through which it is seeking to recover substantial costs. ?Disputes are not unusual in contracts of this nature and we are working with ARL to understand the basis of its claim.
An additional complicating factor has arisen from the collapse of Carillion, one of the joint venture partners. As would be expected in such a situation, Carillion’s liquidation has had significant impacts across the UK. The delivery of projects such as the Royal Liverpool hospital and the Midland metropolitan hospital has been significantly impacted. I understand that new contractors are being considered to complete the projects. In contrast, the contract used for the AWPR made provision for such a scenario, with the remaining construction partners, Balfour Beatty and Galliford Try, being jointly and severally liable for the delivery of the project.
I am aware from third-party representations that there have been supply chain impacts on the AWPR as a result of the Carillion situation. However, I am also aware that the remaining construction partners are continuing to work through such issues to ensure that confidence in the north-east supply chain is maintained. As I announced in February, it is positive that the remaining construction partners on the AWPR have been able to take on more than 90 per cent of the former Carillion employees on the project.
I have said that the contractor has confirmed that its target is now to open the roads during August 2018. Transport Scotland has evaluated the information received from the contractor, together with independent assessments that were undertaken by its technical advisers. I have been advised that the conclusion of that work is that there is a range of dates when the project roads are likely to be ready to open. The earliest that all roads can realistically be open is likely to be towards the end of the summer period, which accords with the contractor’s August estimate.
However, Transport Scotland’s advisers have indicated that they consider ARL’s August estimate to be based on somewhat aggressive programming, with limited contingency. Although I welcome the efforts that are being made by the contractor to secure as early an opening as possible, I have been advised that it is prudent to anticipate the potential for a late autumn 2018 opening date for all project roads. That said, we are also establishing whether any further measures can be implemented not only to ensure that the project is delivered at the earliest opportunity but to identify whether sections of new road can be opened in advance of the whole project. Where that is possible without any impact on the timetable for completion of the project, we will ensure that those roads are opened.
As with all complex civil engineering contracts of this scale, delivery and completion of certain elements of work are dependent on a variety of factors including weather, the scheduling of other works and the availability of specialist resource. Indeed, in the past couple of weeks, weather in the local area has impacted on the project. As a result of those factors, it is not possible to confirm the exact completion date for the works at this time.
With regard to the contract, project programming and delivery are the responsibility of the contractor. The main payment mechanism for the project is through a unitary charge; in effect, payments are directly linked to the roads becoming open for public use. ARL is therefore contractually incentivised to complete the project efficiently while, of course, being obliged to comply with safety requirements.
The total scheme cost estimate remains unchanged at £745 million, and the project is estimated to generate more than £6 billion for the local economy, with an anticipated 14,000 new jobs to follow over the first 30 years after opening. Once open, the AWPR will cut congestion in and around Aberdeen city, reducing emissions and improving active travel. It will also improve connectivity in the region and provide better journey time reliability, particularly for those who are travelling from the north of the city to the south side.
A route around Aberdeen was first proposed over 65 years ago, and since the legal challenges were set aside in 2012, we have been working hard to deliver this essential project. I appreciate that residents and businesses of the north-east would wish the AWPR to be open as soon as possible, but I assure them that they will enjoy considerable benefits when it opens, which, again, will be at the soonest possible opportunity.
I also want to provide a brief update on other major trunk road projects across Scotland. On the A9 dualling programme, following the completion of the section between Kincraig and Dalraddy, the Luncarty to Pass of Birnam section is expected to be awarded in the first half of this year, and we also expect advance works to start there later this month. Following the recent publication of draft orders for schemes, representing 30 of the 80 miles to be dualled, I can advise that we now expect to publish draft orders for a further four dualling schemes in the coming months.
Of course, the A9 dualling is not just about building roads. Just last week, my colleague the Cabinet Secretary for Finance and the Constitution, Derek Mackay, attended the launch of an A9 tourism application that is being taken forward as part of the Scottish Government’s innovative CivTech challenge, which looks to new technology businesses to solve technological challenges. The app will help tourists to navigate the many visitor attractions and facilities in and around the A9 corridor.
Design work continues on the A96 Inverness to Aberdeen dualling programme, and the work that we are progressing includes a rolling programme of regular engagement with local communities and other stakeholders to ensure that those affected by the work are kept fully informed. It will also ensure that the vital feedback that we receive is taken into account as we develop our plans. To date, more than 11,500 people have visited public engagement events on the A96 dualling. Along with our commitment to dual the A9 between Perth and Inverness by 2025, dualling the A96 will ensure that the road network between all Scottish cities is of at least dual carriageway standard by 2030.
I trust that my statement has given members an indication of the extensive work that is under way across the country to bring forward these critically important trunk road schemes, which will build connectivity, improve access to education, jobs, tourism and other opportunities, and improve safety across Scotland’s trunk road network.
I am happy to try to answer members’ questions.