Contractors berate flagship PFI scheme

Exclusive by Carol Millett



Proposals for what could be the first privately financed integrated transport scheme have been met with extreme scepticism by contractors.

North Yorkshire County Council is proposing a PFI project to include construction of a £20m bypass of Scarborough, the operation of two park-and-ride schemes and the management of Scarborough's traffic flow and street parking.

But contractors have questioned the scheme's bankability. A director of one leading civil engineering company told CJ: "The Government wants local authorities to combine PFI road schemes with integrated transport schemes. But trying to tie up deals like that is just not viable.

"Revenue for the operation of the park-and-ride bus company is dependent on parking restrictions. If the local authority changes tack on these restrictions that would be the end of the revenue. It's just not bankable. There are too many unknowns."

Another roads contractor said: "Why not just build the bypass? Trying to bolt on this sort of integrated transport scheme just creates delays. We know it won't work, they know it won't work, but they go through the motions because they have to be seen to be following government policy."

The Confederation of Civil Engineering Contractors also sounded a note of caution.

CECA director Maurice Webb said: "The Government and local authorities cannot expect contractors to take on PFI schemes if those schemes include businesses which don't produce a cash flow. Contractors have to look carefully at what is included in these privately financed integrated transport schemes."

However, the Public Private Partnership Programme (PPPPs) that helped North Yorkshire County Council put together its proposal defended the scheme.

Roads director David Locke said: "Scarborough is trying to push back the boundaries by doing more than just a road scheme. Their thinking is in line with the Government's agenda which is to provide an integrated transport system rather than just build roads.

"If contractors are only interested in building roads they will find that in the future there is little work for them."

Locke also expressed surprise at contractors' views on the profitability of the park-and-ride scheme. He said: "The fact is the scheme has not been finalised in terms of its scope and arrangement so the criticism is rather harsh. Certainly, the payment for the park-and-ride scheme will not be based on the number of passengers but on the buses' availability."

The scheme, which has already won provisional approval from the Department of the Environment Transport and the Regions, is expecting to win full approval next month.