Road super agency reforms underway

Exclusive by Carol Millett

The management and maintenance of the entire M25 motorway is to be combined into one long-term super agency contract worth £40m a year, Contract Journal learned this week.

Creation of the M25 contract is part of an ongoing reorganisation of the way the Highways Agency operates its 24 super agency maintenance areas.

The M25 contract will include all motorway 'tails' into London as well as the M1 to junction 8 and the A1(M) to junction 4 at Hatfield.

The Highways Agency is also considering the inclusion of the Dartford Crossing when the present concession expires next year. It is planned that the contract will be run on a traditional managing agent (MA) and term maintenance contractor (TMC) basis and will last for five to seven years.

The reorganisation will see a number of pilot Managing Agent Contractor (MAC) contracts whereby managing agents and term maintenance contractors will be combined to form a single entity. Each MAC is expected to run for five to seven years.

The first of these will be let in area 8, which covers all major trunk roads and motorways north of the M25 to Leicestershire, including the M11, M1 and Al(M).

Tender documents for the M25 contract, the area 8 MAC contract and areas 3 and 6, which border the M25, will be out by August and all contracts awarded by Christmas. Area 5, which maintains the southern half of the M25 and the M40, A41 and M4 to Oxfordshire, will be absorbed into the new M25 contract.

The Highways Agency is also expected to launch its first privately financed MAC. This will be part of a second tranche of super agency contracts to be retendered next year.

This is expected to be a longer-term contract of between 15 to 30 years with a similar payment mechanism to the Highways Agency's design, build, finance and operate schemes.

The M25 super agency is part of an ongoing rationalisation of the Agency's maintenance areas, which has already seen their numbers reduced from 91 local authority maintenance areas to 24.

This number is expected to shrink further as 30% of the trunk road network is detrunked and transferred to local authorities. The five super agencies within Greater London will also be transferred to Transport for London under the new mayor.

The Agency's plans for the M25 were revealed to contractors and consultants at a recent workshop, held to discuss the reorganisation of its maintenance areas.

A leading consultant welcomed the new maintenance and management contracts. He said: "Most consultants are in favour of the MAC option, so we are pleased that the Highways Agency has taken on board our views expressed during the consultation period proceeding these changes. We also see the M25 contract as a logical decision that makes more sense than splitting it into three parts, as is the case now."

A super agency contractor said that consultants and contractors were already in talks to create new joint ventures to bid for the pilot MACs, but he warned: "There will be less opportunities for both contractors and consultants. It is a shrinking market."