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We will now hear evidence from representatives of the Forth replacement crossing team in Transport Scotland. The aim of the session is to gain a brief overview of the project so far, and to hear updates on current and upcoming work. I welcome the witnesses, who are David Climie, the project director of the FRC team, and Lawrence Shackman, the project manager of the team. I invite them to make a brief opening statement.
Good morning convener and committee members. I am the project director and employer’s representative for the Forth replacement crossing project. I joined Transport Scotland in June 2010 after 27 years working for contractors on some of the largest bridge projects around the world, including in Hong Kong, Denmark, China and the United States of America. My colleague, Lawrence Shackman, is the project manager and the deputy employer’s representative. He has worked for Transport Scotland and its predecessors since 1999 and has been on the FRC project team since 2006.
Thank you. Mr Shackman, do you want to add anything?
No—I do not think that there is anything to add to that synopsis.
Mr Climie said that the project is on time and on budget. I think that the biggest concern for the public, particularly given recent events in Edinburgh, is to what extent the contract will ensure that there is no great increase in the budget. What guarantees can you give about that? Obviously, there can be unforeseen circumstances, so to what extent has that risk been transferred? Is it still possible that there will be quite an increase in the amount of public money that will be required for the project?
Obviously, we are very aware of what has been happening elsewhere. A strict governance process has been put in place for this project, to ensure that things are monitored and documented by Transport Scotland. As I said, we have co-located our employers delivery team, which is part of Transport Scotland and the Arup-Jacobs joint venture, with our contractor on the site in order to ensure, at all levels, that we know exactly what is going on and how things are progressing. We also report to a financial and risk-advisory group, which meets on a two-monthly basis and we report regularly to a project board chaired by David Middleton, the chief executive of Transport Scotland, and which also has non-executive members.
Apart from inflation, what changes represent possible risks to the public purse?
Changes are probably the key risk. Going back and altering the scope would be a key risk affecting both times and costs. With the present project, it is good that we had a two-year dialogue period during which we explored and scrutinised in great detail the scope of the project and all its risks. We ensured that we had included within the base scope everything that we should have included. Unless something unexpected adds to that scope, we are confident that we will remain on time and on budget.
I might be repeating debates from the past, but is it critical that the new bridge be completed by 2016—based on information about the old bridge—or would delay beyond that date simply mean a risk of cost overruns?
Obviously, if the project overruns in time, there will be a risk of cost overruns as well. Time and cost run in parallel. At the moment, we have no updated information on the prognosis for the cables of the old Forth road bridge. I believe that the next inspection is due to commence late this year, with updated information being presented in early 2013. I cannot speculate on what the outcome might be, but everything has been put in place to ensure that the new bridge will be open in 2016. That fits with current information on the status of the existing road bridge.
Is it true that the latest prediction is that the old bridge could be used until 2021 or have I been misinformed?
The latest information is that there is still a possibility of a restriction on heavy goods vehicles as early as 2014. However, it is more likely to be in the window from 2017 to 2021, with a ban for all vehicles sometime beyond that.
As the former convener of the Forth Crossing Bill Committee, I am encouraged by your summary of progress since then.
That is a fair comment. When the project was initially thought about, it was clearly thought about as a complete replacement crossing. Since then, the prognosis has changed significantly: the Forth road bridge now has a long-term future that is being built into the overall managed crossing strategy. The minister has said that he would like there to be a new name for the bridge when it opens. At present, we continue to refer to the “Forth replacement crossing project”, because that is what is being procured. However, we are currently investigating different options for some sort of naming process for the new bridge. That seems to be appropriate.
As Malcolm Chisholm said, recent events have given the public cause for concern about major capital development projects. I am not saying that the public will have been slightly sceptical when they heard that the tendering process had produced such a saving over the estimate, but I wonder whether you, too, were slightly surprised to find that the tendering process produced a dividend in terms of a reduction in the estimated cost? What do you think brought that about? Did you expect that to happen as you neared completion of the tendering process? Are you confident that the tendering process has produced a reduced cost that is robust?
I will answer your last question first. Yes—we are absolutely certain that the prices that we have are robust and cover all aspects of the contracts as tendered. The original cost estimates were made back in 2006 and, as we moved forward in the process, those cost estimates were updated on the basis of inflation over the period. Prior to the financial crisis, there was a boom in the construction industry and there was a tendency for tender prices to be higher. In certain cases, it was quite difficult to get companies to bid because there was so much work around. To a degree, we had a certain amount of luck in the timing because, when we were receiving the bids at the end of 2010, the market was not buoyant—it was going through a bad time at that point—and contractors were very keen to put in realistic but competitive tender prices. In real terms, the tender prices that we got for all three contracts were effectively back at 2006 levels. Looking at all the published tender price indices, we see a curve rising from 2006 to 2008, with prices peaking in 2008 and then dropping back down to 2006 levels at the end of 2010. It was very much in line with the tender prices that we are seeing in published indices.
So, in a slightly perverse way, the project has benefited from the general economic conditions that obtain.
Yes. I think that is true.
Obviously, inflation is expected to fall at some point, but it is running at a relatively high rate at the moment. In relation to the project, can you confirm again the expected rate of inflation to which you are operating?
I can. The range that we are using has a low end of 2 per cent, a median of 5 per cent and an upper end of 8 per cent annually. We will continue to monitor inflation closely, as it is one of the key areas in which we have risk. The base date, when the invitation to tender for the principal contract was issued, was December 2010. We are currently running at or just above the top end of that range; however, it is early and, as you say, inflation is expected to fall back. We will continue to monitor it regularly so that we ensure that we remain within the envelope.
Remind me of the potential consequences for the project were inflation to remain at those three levels. Where would that sit in terms of any potential additional cost that would subsequently materialise?
The top end of the range that we have quoted—the £1.6 billion—assumes that inflation continues to run at 8 per cent right the way through until completion of the project.
Thank you.
Depending on where one stands in the argument, one of the benefits or dangers of a bridge project is the fact that, unlike a road, train or trams project, a bridge project cannot stop halfway. You mentioned that you have world class road-building, bridge-building and civil engineering companies involved. I am pretty sure that the companies that were involved in the Edinburgh trams project would have described themselves similarly. What safeguards are there for the taxpayer to ensure that any conflict or disputes between the different parties that are involved will be resolved quickly and cheaply?
That is a very important point. The first stage to that is, as we have done, to co-locate and zipper the two organisations together. I meet the FCBC project director daily to ensure that I am aware of what is going on. The key to these projects is to ensure that there are no surprises, because we do not want anything to develop into a major issue.
I also assume that you will be reporting back to the committee at regular intervals and that we will—I hope—be alerted to any such potential problems as the contract goes through.
Yes, absolutely.
I was not a member in the previous session of Parliament, but I assume that all the contractors have evidenced their competence and ability to deliver. What steps are being taken to future-proof the bridge? Equally important, what steps are being taken to ensure that it is not expensively overengineered?
The competitive dialogue process that has been undertaken over the past couple of years to get to the contract award involved a specimen design that the team put together based on expert knowledge of other bridges of this type throughout the world, notably the Stonecutters bridge in Hong Kong, and the contract documents were formulated on the basis of best practice on that bridge and other bridges throughout the world. Throughout the dialogue process, we were able to discuss the particular tenderers’ proposals. For example, the two tenderers had different views on how the bridge should be taken forward. The team certainly looked at every aspect of the contract requirements and the example specimen design that was prepared for it to see how it could engineer the design to meet the contract’s requirements.
In order to allow us to do some research, would you point to the bridge in Hong Kong as being a successful example of how such a project should be managed or would you suggest somewhere else?
It is very difficult to take one particular project as a prime example. The contract for the project in Hong Kong was different to the one that we are using—it was not a design-and-construct contract but a more traditional two-party contract—so you cannot compare that side of things. However, David Climie worked on the Tacoma Narrows suspension bridge, which was a successfully delivered design-and-build project. There are good and bad examples all over the world but, from a design point of view, the Stonecutters bridge has some very good modern features.
I am talking about the management of the project and finding out how successful it was.
In terms of the management of the contract, I would draw parallels with the Tacoma Narrows project in Washington state in the USA, which I worked on prior to coming here. The client was the Washington State Department of Transportation. It did many of the things that we have done. It co-located the new bridge with the existing bridge, and the project came in about $80 million under budget. The original budget was about $840 million and the final cost came in about $80 million under that—and the new bridge opened on time.
I am sure that the convener will arrange a trip to Washington for us.
I wondered whether you were fishing for a trip.
Thank you, gentlemen, for your update. It is gratifying to know that the project is still on time and on budget.
Yes. One of my colleagues is taking forward that work. A number of meetings have been held with the local authorities—Fife Council, West Lothian Council and the City of Edinburgh Council—the south east of Scotland transport partnership, which is the relevant regional transport authority, and the bus operating companies to develop the public transport strategy. We have been able to extract a number of elements of the original strategy and take them forward as part of the scheme—namely, the bus hard-shoulder running on the Fife side and as part of the junction 1A project, together with the dedicated public transport corridor, which is the Forth road bridge. That is obviously the biggest element of the project. A number of things have been done to progress public transport elements of the strategy through the project.
You mentioned some of the stakeholders that have been involved, but I did not hear any reference to the people who cross the Forth. The councils and the transport authority have been involved, but what about the people who have to get across the Forth?
At this early stage, it is quite difficult to involve the public. That should certainly be taken forward when the overarching work has been done to identify the key problem areas. A lot of people who use the road corridor and the bus network will know that Newbridge is a difficult part of the road network, as are the connections from Edinburgh to the corridor involving the M9, the M90 and the A90. I agree that the public need to be involved, but at an appropriate time.
In response to my first question, you referred to bus hard-shoulder running from Halbeath and the park and ride at Halbeath. Is that on track for introduction next year?
No. It is on target for introduction in 2013, but it is hoped that construction will start next year.
I understand from the previous committee’s work that not much work had been undertaken to encourage modal shift in cross-Forth journeys. How does the public transport strategy seek to rectify that, and what work is on-going to get people out of their cars and on public transport?
With the introduction of the bus hard-shoulder running, we will embark on an education programme to inform and educate both the general public who will use the M90 corridor—taking the Fife ITS bus hard-shoulder facility as an example—about the benefits of using the facility, and the bus companies about how physically to use the facility when it is complete next summer. One element is therefore to educate the public and bus companies.
This follows on from Jackson Carlaw’s question earlier. The idea is that the existing bridge will be retained largely for public transport use. Before the committee kicked off, we were discussing the fact that there have been reports that some bus operators have indicated that they may prefer to use the replacement—or additional, depending on your perspective—bridge. Will you comment on that?
For the journeys from north to south, it will depend on the destination. If you are going on the A90 corridor to Edinburgh, it will be very sensible to use the existing bridge because it is the most direct route. If you are going to the airport, there is no dedicated link from the existing bridge aside from going down the B800 towards Kirkliston, which is not a preferable route for fast inter-city coaches to get to the airport and destinations down the M8 and city bypass corridor.
So, you are confident that there will be enough demand for public transport on the existing bridge so that the two-bridge strategy is worth while.
Yes. I have not got the actual figures and proportions, but the vast majority of buses travel to destinations down the A90 corridor to Edinburgh.
I understand that the previous committee heard evidence that there is an informal arrangement whereby FETA will take responsibility for ensuring that cyclists can get from A to B if they cannot cross the bridge, for example because of high winds. Is that arrangement being taken account of? Might it be more formalised?
At a previous committee, I mentioned that once we have a maintenance body in place for the new bridge, and looked at the maintenance of the existing Forth road bridge and taken forward what is appropriate, the issue of how pedestrians and cyclists get across the Forth road bridge in inclement weather will be taken forward.
So, we will hear more about that in the future.
Yes.
FETA was just mentioned. What is the position with regard to determining its future and the management arrangements for the new crossing? I understand that a decision was due to be made by 2013—is that still the case? Are we any closer to knowing what the situation will be?
That is still the case; I am sure that the minister will say something in due course.
We look forward to that.
I have a question on public transport provision. You said that the vast majority of public transport uses the existing bridge, which is closed on a regular basis to high-sided vehicles. Those include double-decker buses, which are the most efficient way for public transport operators to move large numbers of people, especially if you are going to build another park-and-ride site at Halbeath. How will you overcome that problem to allow public transport companies to plan for such a situation, which happens on a regular basis, if you retain the existing bridge as a public transport corridor?
We have addressed that by allowing a third bus hard-shoulder running option in the project. If the existing bridge is closed because of strong winds, it will allow buses—in particular double-decker buses, as you mentioned—to cross the new bridge and use the hard shoulder to maintain journey reliability. There are mechanisms built into the intelligent transport system to redirect buses across the new bridge and back on to their old route.
Public transport companies might find it beneficial, in order to plan which vehicles to use, continually to use the new bridge as opposed to the old one. That would give them consistency as they know that they can use a particular driver and vehicle on that route.
That would not be economical, either in terms of time or fuel, because it is a longer route to take. It would not make sense. Also, there is a bus stop in South Queensferry that would end up being bypassed if they did that, so I cannot see it being a feasible option.
The key point of the new crossing is that it adds resilience to the existing crossing, as there will be wind shielding all the way across the new crossing. That will ensure that whenever the Forth road bridge is closed to high-sided buses, they can reroute on to the new crossing in all weathers.
I am not sure at what wind speed the current crossing must be shut. At what wind speed will the new crossing have to be shut, if at all?
At present we do not anticipate any circumstances under which the new crossing would have to be closed. We are currently carrying out extensive wind-tunnel testing to ensure that the wind shielding that will be put in place is the appropriate type, so that we can avoid any closures on the new crossing.
Do you know at what wind speed the current bridge must be shut?
I believe that they begin to bring in restrictions at winds of approximately 50 mph, although I do not know the precise figures.
I think that the bridge closes at winds of 80 mph. We have previously used the analogy of the second Severn crossing down at Bristol, which has wind shielding. It opened in 1996 and has never closed—touch wood—because of high winds, although it has closed due to other issues. The wind shield that we anticipate using on the new bridge will be similar in height and resilience to that one, although it will look different.
If no one else has any questions on that area, we will move on to community engagement. Jackson Carlaw has a question.
Community engagement was a huge part of the original Forth Crossing Bill Committee’s workload, with regard to hearing the respective views of community councils throughout the whole consultation phase on whether that process was thorough and genuine.
Yes.
Did you say that the forum meets quarterly?
The meetings are at least quarterly. At the moment, we are meeting every two months. A fair amount is going on, so we felt that meeting more regularly would be more appropriate.
Will you tell us more about the forum’s composition? As best you can, will you characterise the spirit in which everybody has participated in the forum’s meetings? What key immediate issues have been discussed?
Following a workshop that we held earlier in the summer, it was decided that the community forum would be split into three forums and that community council members could attend as observers forums of which they were not members. The north of the Forth forum covers the communities of Rosyth, Inverkeithing and North Queensferry; the south forum involves Queensferry and district community council and Newton community council; and the junction 1A forum looks after Kirkliston’s interests.
That answer is encouraging. It is enormously beneficial if the community councils do not feel that they have not had a proper opportunity to contribute to the process, as some previously felt.
The community forums have discussed “Engaging with Communities”, which has been published on our website. We stressed to people that that is the first version, which can be changed—we are perfectly happy to amend it if the need arises, as we go through construction. I hope that the document is easy to view and read. The public can see what the project is about and where to go if they have a query or complaint about it.
That is not quite the same as a visit to Washington state, but I am sure that Mr Findlay and I will take advantage of that opportunity.
I think so.
On the issue of community liaison officers, in other projects that I have been involved in, a compliance officer who has been paid for by the contractor and appointed by the local authority, in consultation with the community, has worked with the community to ensure that all the community engagement aspects of the project that have been agreed by the contractor happen. This project seems different, as the community liaison officer is appointed by, and ultimately works for, the contractor. I would be more comfortable with a situation in which the contractor paid the money but the community liaison officer worked on behalf of people in the community to ensure that their concerns were addressed. Will you comment on that?
The fundamental difference from a lot of other projects is that Transport Scotland and our advisers, Arup-Jacobs, which together make up the delivery team, are co-located on site, which means that we will be in the midst of all the work that will be going on. We have a representative working alongside the CLOs, which means that we can ensure that they are doing their job.
I do not doubt your sincerity; I am saying only that, in my experience of such projects in other areas, a lot of warm words are said but it is the action that proves whether the arrangements work. I am sure that your approach is genuine. We will see how the situation develops.
What do you intend to do regarding the hours that are worked? One of the main problems encountered by communities that are affected by such projects involves disturbance at night. Will it be a 24-hour operation?
A lot of work was done on that issue during the parliamentary process and the outcomes have been included in the code of construction practice. That document is unique to the project and sets out clearly what our commitments are and what we must do.
Have there been any problems with land acquisition?
No, it has all gone through very smoothly. The general vesting declarations for all the projects also went through smoothly.
We move on to traffic management during the construction of the Forth replacement crossing. Adam Ingram has some questions.
We are talking about a major artery of the Scottish economy and, as with any major construction activity, there is potential for disruption. Some of us are well aware of that happening close to where we are now.
Yes, is the short answer. We are fortunate in that the traffic management working group was put in place in advance of the contracts being awarded, so it was operating throughout the tender process. That means that all the contractors that were bidding for the work on all three contracts were given a chance to interact with the traffic management working group to ensure that their tenders were based on something practical for the long term. It was not a case of the bidders winning the job and then thinking, “Now, how are we going to do it”; at the earliest stage, there was engagement so that they could decide how they were going to manage the traffic effectively.
Having first been elected to Parliament in 1999, I have seen that Edinburgh seems to be particularly prone to disruptive activities, especially road works. Never a week goes past without a new set of road works interfering with the free flow of traffic. I am interested in what you said about the financial incentives. Could you tell us a bit more about that? Are any penalties involved if the free flow of traffic is not assured?
The lane occupation charge is a mechanism in the contract that has been used in other Transport Scotland contracts for several years. I will try to say this as succinctly as possible. The contractor allows a sum of money in its tender—it is sort of virtual money—and it has to predict how many lane occupations it will use throughout the construction of the project. Different lane occupations attract different amounts of money, so occupation of a lane on the M90 would cost considerably more than it would on one of the B roads, for example. Again, if the lane was occupied during the day, that would be considerably more expensive than it would be at night. That should give you a feel for how the charges work.
Adam Ingram’s final question was about the penalties that could occur. We have built FCBC’s proposed lane occupations into the contract. We will monitor actual lane occupations as the project progresses and if the number exceeds that which FCBC said it would have, there will be financial penalties of so much per lane per day. We can claw back money from FCBC if it goes over what it said in its tender.
I take it that a regular schedule of meetings with FCBC is built into your work.
There is a detailed set of meetings. I seem to spend more time in meetings than I do on the site, so there is a very busy schedule of meetings.
The proof of the pudding will be in the eating. Construction will happen very soon, or indeed is happening now, so we will see how things develop.
We move on to CO2 emissions. Our predecessor committee in the previous session of Parliament had some questions about emissions. Transport Scotland officials advised us:
Yes, we can. I re-emphasise that, on the specimen design, the previous figure that we gave the committee was about 120,000 tonnes of CO2. The calculation in FCBC’s winning tender came out at 110,000 tonnes of CO2. For comparative purposes, the figure given by the losing bidder, Forthspan, was 140,000 tonnes of CO2.
Can you give us some idea of the cause of that difference?
Sure. The figures are based on the main crossing quantities, and on the calculation of the amount of materials—reinforcing bar, concrete and steel—that are involved and the distance that they are transported. Transport is a key element of the total CO2 emissions.
Is that how you intend to offset CO2 emissions? If not, how will they be offset in the context of our climate change targets?
CO2 emissions were part of the tender evaluation process—in other words, FCBC scored better than the losing tenderer on CO2—so if FCBC overruns on what it said at tender time, we want to ensure that it is penalised for not living up to what it said. That is the only mechanism that we have by way of a penalty for CO2 emissions.
Other methods could be used to offset the carbon output. What, if anything, has been done in that regard? Has tree planting or anything like that been done?
Yes. There is extensive tree planting in the scheme, but it is not enough to offset the total amount of carbon by any manner of means.
But there is some.
There are substantial tree planting and landscaping areas on the project.
How does that pertain to the tendering process? FCBC calculated that carbon emissions would be lower. Was that part of the calculation?
It was part of the quality evaluation, which formed 10 per cent of the overall evaluation scoring.
It is reassuring to know that that is taken into account.
I think that we will return to that matter in future meetings.
A number of obligations are placed on the contractor in the contract—I am talking about the principal contract and the major part of the project. The contractors were asked to provide a minimum number of places in their tenders; on top of that, they gained more points towards their quality score if they offered further training places and opportunities for long-term unemployed people.
As most members of the committee are new to the project, can you give some idea of how many people you estimate will be employed on it? I presume that a number of the bidders will use subcontractors. Where do they envisage getting their labour from?
We recently spoke to FCBC, which thinks that, over the course of the project, it will have around 200 people working on the technical management side of the project and up to 1,000 people building the project, although that figure will vary during the duration of the contract, depending on the activities that are going on. That gives members some idea of the scale of the project and of the opportunities that it presents.
I have a final question, which occurred to me during the convener’s line of questioning. It is about elements of the contract.
The main element is a prompt payment clause for subcontractors to ensure that they are paid on time, and we have built that into the main contract. Obviously, a key issue is that money can be withheld, and that is a major problem for small companies. Therefore, we have ensured that all our main contractors have a commitment to prompt payment to all their subcontractors. As you have said, it is difficult to build in specific requirements for managing the supply chain, but we will, obviously, monitor the matter and keep our eyes and ears open.
I have a final thought. To paint a picture for the public, much of the work that will be done in the interim period will be preparatory work on both sides of the crossing. I recall from what was said in the Forth Crossing Bill Committee that a lot of work will be done on the foundations on the Beamer rock, which will allow it to take a construction that will arise from the middle of the estuary and stretch out from there. On what date will the public look out into the Forth and see an emerging bridge?
We can give members an idea of some basic timescales. All the foundation work—the underwater work and so on—should be finished during 2012. Therefore, we should be ready to start rigging up the three towers by the end of next year. The towers will take between 12 and 18 months to construct—that will be through 2013 and the first part of 2014. We should see the first decks being erected during 2014.
I thank both witnesses for attending the meeting and providing us with an update on the most significant infrastructure project in Scotland. I hope that your biannual oral updates, which were introduced by our predecessor committee, will continue and be supplemented by written updates between the sessions. We would like an early indication of any problems or successes if anything major crops up in the project. We need to visit the site as soon as possible to get a visual idea of the project.