Smarter Cambridge Transport

Who is to blame for transport project cost overruns?

Fendon Road roundabout joins a litany of Cambridgeshire County Council transport projects running hugely over budget and time: Ely Southern Bypass, King’s Dyke crossing, Lancaster Way roundabout, Hills Rd cycle lanes, Cambridgeshire Guided Busway et al.

The pattern seems to be this: in their haste to get shovels in the ground, councillors and officers decide to proceed when costs are still highly uncertain. When costs do overrun, their response is, “It was going to cost this much anyway, whether or not we knew it beforehand.” The implication is that the project is uniquely important and must be delivered as designed whatever the cost. This is almost never true.

The attitude is irresponsible and has serious consequences: the council has to shelve or delay other projects, or borrow more money. Debt further increases the project cost, and the repayments squeeze other budgets for many years to come. This is robbing Peter to pay Paul. Of course, the council could cancel the overrunning project, but then the waste of money would be undeniable.

The tripling of costs of rebuilding Fendon Rd roundabout to £2.4 million reduces the benefit-to-cost ratio by two thirds. This almost certainly makes it poorer value for money than other projects that could have been funded instead – for instance redesigning the hazardous mini roundabouts between The Fen Causeway and Lensfield Rd.

But it’s not all the fault of the council. Other parties, in particular utility companies, have little incentive to cooperate and contain costs. The local authority bears the costs of relocating services affected by its projects: water and gas pipes, electricity and telecommunication cables, and connection cabinets. Too often nobody knows what’s under the ground until they start digging. Multiple companies have to perform complex, hazardous and highly technical works in an unchoreographed dance. Costs can quickly spiral out of control.

To address this, councils should lobby government to have utility companies bear some of the costs and risks – in part to incentivise them to maintain accurate records and act responsively. Above all, though, the County Council must take a less gung-ho attitude with public money.

This article was first published in the Cambridge Independent on 8 July 2020.

Edward Leigh

Edward Leigh is the leader of Smarter Cambridge Transport, chair and independent co-opted member of the Cambridgeshire Police and Crime Panel, chair of the South Petersfield Residents Association, business owner, consultant, and occasional blogger about making the world and Cambridge a better place to live.

1 comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

  • We now know, of course, that the project had already nearly doubled in cost BEFORE getting “shovels in the ground”. There was no uncertainty with that already huge overrun. And yet construction started, despite the uncertainty that the overrun would grow further.