Highways England’s chief has rubbished claims that the management of the UK’s highways is set to be handed over to private firms, calling the idea “nonsense”.
Chief executive Jim O’Sullivan told Construction News there “was no truth at all” in reports that Highways England was seeking a consortium of three private partners to take over its £15bn investment plan.
In an article published in the Times last week, it was reported that Highways England was set “to undergo the biggest outsourcing of public services into private hands in Whitehall’s history”, with a consortium made up of consultant CH2M, contractor Mace and accountant PwC set to be charged with managing the UK’s roads.
However, Mr O’Sullivan said “someone had got their wires seriously crossed” and insisted the three firms were programme delivery partners, providing advisory support to Highways England in delivering the Roads Investment Strategy.
“We have a consortium that has got together to provide us with skills we need in order to deliver the capital programme,” he said.
“It is on a contracting basis; they provide us with services, which we use in only one division of our organisation.”
Last November, the programme delivery partner framework was put out to tender by Highways England, known then as the Highways Agency. In the OJEU notice, the agency outlined the need to “enhance its capacity to manage the increase in workload”.
It said that, as a result of the “uplift in work”, it would need to “bring in expertise from outside of the organisation in the near to medium term to support this transition”. That contract has been awarded to a CH2M Mace/PwC consortium.
The £65m contract will last four years. Five employees from the three firms will work in Highways England’s new “capital portfolio office”.
Decisions will then be made on the distribution of resources and manpower to ensure strategic roads projects and programmes come in “on time and on budget”.
“At the moment, someone is given a scheme and they then deliver it as close as they can to budget; that is how we work,”
Mr O’Sullivan said. “With the portfolio office we will be able to consider all schemes and this will allow us to enable funding [and] resources to ensure they all come in on time and on budget; ensure no scheme wastes money; and that money saved can be spent somewhere else.
“[We will ask] if we are ahead on one scheme, do we close it early and stay ahead on that scheme, or do we transfer our resources to another scheme and get that back on time?”
The Roads Investment Strategy launched in December 2014 and laid out a five-year £15bn plan to overhaul Britain’s roads, including 112 major improvement projects.
Mr O’Sullivan said the advisory role of the consortium was unlikely to continue past the four-year contract, with representatives from the firms expected to leave the portfolio office once Highways England had developed its own in-house skills.
“To start from a standing start with a portfolio office, it probably takes a good two to three years,” he said.
“As a result, we are going to take a cell of about five people, bring them into the company and then slowly but surely replace them with our people.
“The long-term plan is as we develop our own capability, the consortium will assist on how to deliver that.”
WSP Parsons Brinckerhoff head of highways and bridges Steve Smith welcomed the move and said the delivery team had the right expertise when it came to programme delivery.
He said: “When you have a large programme with time constraints and other constraints, it is smart to bring in experts from the three areas [finance, construction and design] where they are most needed.”
He added that having rival CH2M take on such a central role with a client was not a concern.
“The only thing that is important is that Highways England has a programme that is properly managed and properly scheduled for the future.”
The contract marks a further win for Mace in programme management work.
Last week, the contractor was selected as programme support partner for Transport for London’s Four Lines Modernisation programme on the tube network, alongside CPC Project Services.
In 2006, it won the delivery partner contract for the London Olympics, alongside CH2M and Laing O’Rourke. It has also bagged major programme management wins including a deal to manage the construction of the Dubai World Trade Centre, with CH2M.
CH2M has worked on major infrastructure projects across the world and is currently vying for the 10-year £350m engineering delivery partner role on the High Speed 2 project.