Extra costs jeopardise Stonehenge tunnel deal

Balfour Beatty and Costain could see their £192m A303 road tunnel project and upgrade at Stone-henge shelved after costs for the scheme rose by £31m.

The price hike was unveiled by transport minister Stephen Ladyman in answer to a question tabled by Liberal Democrat MP Simon Hughes, in which he confessed the project had unexpectedly risen to £223m. It is now believed the scheme has broken the Department for Transport’s (DfT) maximum price threshold for this scheme and could be ditched.

Costain and Balfour, appointed as jv contractors for the early contractor involvement scheme in 2002, have already witnessed lengthy delays to the outcome of the public inquiry stage. A report by the inquiry inspector was originally due last autumn.

However, before the report was submitted, transport secretary Alistair Darling reclassified the national scheme to a regional project and passed it on to be reviewed by the South West regional transport board.

A DfT spokesman told CJ that the inspector’s report on the scheme was now in from the regional board and is awaiting a decision by the secretary of state.

The spokesman was unable to say whether or not the project had been shelved, adding that it was “up for the secretary of state to decide”.

A date for a decision has not been set.

The spokesman was able to confirm that the price hike was due to costs not factored in at the start of the scheme, which included preparation costs, land costs and non-recoverable VAT.

The jv has already mobilised its teams on site for an immediate start when the scheme is given the green light. But unofficially both now fear the plug could be pulled on the scheme.

One source told CJ: “This will be a real kick in the teeth for the project team, which has worked hard on the contract.

“The whole scheme has smacked of regional interference and government dithering,” the source said.