Out-Law News 2 min. read
23 Apr 2012, 3:52 pm
In its first annual report (64-page / 657KB PDF) Infrastructure UK, the Treasury department tasked with advising the Government on infrastructure, said that "changed behaviours and practice" as a result of the Cost Review were already having an impact. The Cost Review, launched in March 2011, set out plans to reduce the cost to the public sector of delivering infrastructure by £2 to £3bn a year by 2015.
Its focus for 2012-13 will be to "embed the behavioural changes and improved processes required to sustain these savings", with particular emphasis on the top 40 priority infrastructure projects and programmes identified by the Government in November's updated National Infrastructure Plan, it said. These projects include the Mersey Gateway Bridge, Crossrail, the Thames Tideway Tunnel and the new High Speed 2 (HS2) high speed rail link between London and the Midlands.
The report highlighted a projected 20% saving in the cumulative cost of the Highways Agency's Managed Motorways and Trunk Road Improvement programme. By planning and managing the 14 major projects approved in the Government's last Spending Review, as well as a further six as part of the Autumn Statement in November, as an integrated programme rather than a series of discrete projects the Agency was able to "collaborate more effectively with their supply chain" and save money, it said.
The Government has also put in place an agreement between the Highways Agency, Environment Agency, London Underground and Network Rail allowing them to pool data and access commercial intelligence. In addition, the Government is working with the private sector to develop 'capability plans' covering major sectors, which will address skills gaps and capability issues in a coordinated way. In the tunnelling sector, for example, the new Tunnelling and Underground Construction Academy will create a more coordinated approach to training and apprenticeships which will benefit headline national projects including Crossrail, HS2 and the National Grid cable tunnels.
Lord Sassoon, Commercial Secretary to the Treasury, said that "every pound" saved through the programme was another pound that could be spent on new projects.
"It is vitally important that utility bill payers and taxpayers get good value for every pound spent on new infrastructure," he said. "This first annual report shows we are on track to deliver the savings we identified last year. What is particularly encouraging is that these savings are being delivered through close and fruitful co-operation between the public and private sectors."
Other achievements the report highlights include the creation of the Infrastructure Charter, developed by the Government and an 'Alliance Group' made up of a number of industry bodies, which sets targets to find ways of delivering infrastructure more cost effectively through collaboration. A new 'routemap', enabling public and private sector clients to select the most appropriate procurement strategy for their projects, is being developed, while more efficient risk management and contingency planning are being encouraged to save costs. London Underground, for example, is on target to more than halve its 2009 level of aggregate risk exposure through an improved risk mitigation programme.
An Industry Standards Group, focussing initially on the transport sector, is currently looking at ways to remove duplication and redundancy in technical standards for infrastructure assets. The group is due to report to the Government in June 2012.
