Squeeze on for rail, roads and schools to find 20% cuts

1 April 2011

Procurement savings on infrastructure programmes in schools, rail and road building are being planned following the 20 per cent cuts proposed by the government’s Plan for Growth.

School procurement could be passed to a central agency in a move which would see cost savings achieved through economies of scale, Building reported.

The plans, which would contradict the government’s localism agenda, are included in the latest draft version of the Sebastian James review into future schools procurement.

Under the proposals, a delivery body would take control of procuring all buildings above a certain threshold. Local authorities would be involved in making the final decision on a bidder but would not manage the procurement process.

At the same time Network Rail is to overhaul procurement procedures on £6 bn of rail projects in a bid to slash costs, Construction News reported.

Under the plans contractors and designers will be brought on board at a much earlier stage to help develop project options and speed up delivery.

Simon Kirby, Network Rail’s director, investment projects, said: “The rail industry must reduce costs and these radical reforms will revolutionise the way we deliver our projects, helping to slash red tape and restrictive bureaucracy while generating significant cost savings and efficiencies.”

The Highways Agency has also committed to cut the cost of major roads projects by 20 per cent, Construction Enquirer reported.

These include three projects on the M1, two each on the M25, M62 and M60, one on the M6, one on the M4, work on the A556 between Knutsford and Bowden, and schemes on the A1 and A11.

The industry champions who will drive the Treasury’s Infrastructure Cost Review Implementation Plan have also been named, Construction News reported.

The plan, which focuses on water, waste, transport, energy and telecommunications and construction, hopes to slash costs by £2 to £3 billion a year.

BAM Nuttall chief executive Stephen Fox will head up an infrastructure industry group,  Network Rail director of investment projects Simon Kirby will lead an infrastructure client and procurement group and chief scientific adviser to the departments for transport and business, Brian Collins, will lead an infrastructure data group. ICE president Peter Hansford will oversee the three groups.

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