A465 road improvements hit by cost increases and two year delay

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Road improvements on the 8km stretch of the A465 between Gilwern and Brynmawr will cost the public purse £100m more than estimated and will take two years longer than expected, according to a report issued by the Auditor General for Wales

The A465 section 2 is an 8km stretch of road between Gilwern and Brynmawr. It involves building on a steep-sided valley – the Clydach Gorge – and passes through the Brecon Beacons National Park.

The work to improve the road is part of a larger scheme to improve 40km of the A465 between Hirwaun and Abergavenny which is expected to cost around £1bn. The scheme is intended to have a considerable impact on investment and economic activity along the Heads of the Valleys corridor.

Contractor-Government dispute

The final cost and timescale for A465 section 2 remain uncertain.

The work was due to finish in September 2018, but full completion is now expected to run into 2021.

Welsh Government estimates from November 2019 suggest a total bill of around £321.1m to the public purse. However, the Welsh Government and the main contractor, Costain, have been in dispute about who is liable to pay certain costs. Costain considers that the latest estimates of Welsh Government liabilities are understated.

The Welsh Government considers that the figures represent a reasonable allowance for its liabilities at this stage.

A465 cost estimate

The £321.1m figure is less than the £336.2m estimated in April 2019, but at the start of the detailed design and construction contract in December 2014 the Welsh Government estimated a cost of £223.2m.

Some of the increase relates to design changes requested by the Welsh Government and additional measures to address environmental impacts, but the engineering and contractual challenges experienced on the project account for most of it.

The report highlights that despite the increasing costs and delays, the project has delivered some wider social, economic and environmental benefits already. These include employment opportunities and the creation of a construction training academy.

Disruptions

However, the disruption and delays have had a significant impact on the local community. By the end of November 2019, this had included 57-weekend closures and a further 75 weekday overnight closures.

The level of disruption has been considerably greater than expected at the start of construction and has raised complaints from drivers and the local community.

Auditor General for Wales, Adrian Crompton said: “This is not the first time that the Welsh Government has faced difficulties with significant cost increases and delays on road projects and it is vital that lessons are learnt for future infrastructure schemes.

“Despite some wider benefits being delivered and expectations about the eventual impact of the road improvement, those living and working locally are paying a higher than expected price for the ongoing delays and disruption during construction.”

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