Project cots rise ‘due to inflation’

Aug 21 2008 by Oliver Clay, Runcorn and Widnes Weekly News

THE Mersey Gateway project may cost £604m according to a council report published in July.

The figure includes inflation and other costs not part of the usually quoted £390m figure

The report estimates that inflation will cost £147m and says an extra £41m will be spent on changes to the design.

A further £26m has been allocated to cover unforeseen costs.

Mersey Gateway spokesman Chris Taylor said: “The project’s funding comes from central government and the private sector contractor that will be appointed to build and operate the scheme.”

He emphasised that the increases will not be met from Council Tax.

The report says funding allows for inflation and extra costs and the project will still reap surplus toll cash to reinvest.

Steve Nicholson, Mersey Gateway project director, said: “The total estimated cost, in 2007 prices, has been revised upwards by just under 11% from £390m to £431m.

“The latest economic estimates for the project show the economic benefits it will bring to Halton and the surrounding area are almost four times greater than the cost.

“This cost-benefit ratio shows the project remains good value for money, the revised estimates remain affordable and the package will be attractive to private sector partners.

“The increase of £41m has been caused by changes to the design.

“It specifically includes changes made to the Central Expressway, including environmental works such as noise barriers, replacement footbridges and landscaping along with additional works to deal with contaminated land in south Widnes.”

Mr Taylor added: “It is standard practice during the development of large projects like this to quote costs in current prices rather than outturn costs as these provide the best figures for comparisons in today’s money.”