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UK Major Projects Pipeline Update

Back in January, we took a look at the major infrastructure projects pipeline in the UK. Now 9 months on, how much has changed, what projects have seen progression and which are suffering from obstacles?

 

Rail

Crossrail 1

Crossrail 1 central section was due for completion in just a couple of months, but this has now been delayed to next autumn, costing TfL millions in lost revenue.

The delays, caused as a result of unfinished construction work and problems with testing, will mean that demobilisation of the remaining project team members will also need to be pushed back to retain key staff.

Crossrail 2

Discussions regarding funding of Crossrail 2 continue to rumble on. There have been murmurs that Crossrail 2 may face the consequences as a result of the Crossrail 1 setbacks. Jasmine Whitbread, the Chief Executive of business group London First, has warned against falling “into the trap of using a temporary setback to Crossrail 1 as an excuse for a permanent delay to Crossrail 2.”*

The autumn budget may shed some light on the future of the project, but don’t hold your breath.

HS2

HS2 gained a lot of momentum last year with the main civils contracts being awarded for phase 1. If all went according to plan, the main civils contracts were due to move from design into construction later this year. But as with most major infrastructure projects, HS2 has also been hit by delays and setbacks.

The start date for delivery of the main civils works has been delayed until June 2019. The notice to proceed (NTP) was pushed back to provide suppliers with additional time to optimise their designs and bring costs down.

Alongside this, HS2 are understood to be in final negotiations with its preferred contractors for the stations contracts with winners due to be announced this autumn.

The Land & Property budget remains under significant scrutiny from government.

 

Aviation

Heathrow Expansion

Back in June Parliament formally gave the backing for the construction of a third runway at Heathrow by voting in support of the Government’s Airports National Policy Statement (ANPS). This has paved the way for Heathrow to proceed with applying for the Development Consent Order.

Heathrow will continue to develop their organisational structure to see where more resources and skills are required as they progress the development phase of the programme. Heathrow are keen to embrace the ICE’s Project 13 approach to major programmes.

London City

Works are well underway to deliver the massive City Airport Development Programme which is estimated for completion in 2022. The installation of over 1000 piles, which will create the new land upon which new airport infrastructure will be constructed, began earlier this month.

Stansted Airport

Stansted Airport started the bidding process for its planned £340m expansion programme earlier this year, with contracts due to be let in 2019.

The project will include a new multi-million-pound arrivals terminal and a major redevelopment of the airport’s main terminal.

 

Water

AMP 7

The 7th Asset Management Period is due to run from 2020 to 2025. All the major water companies will now have finalised their business plans and procurement is well under way for contractors and consultants to deliver those plans.

Last month Yorkshire Water started the procurement race and went to tender on two major contracts for the AMP7 period worth a total of £1 billion.

Thames Tideway

Thames Tideway is a maturing project now, but there is still a long way to go before completion. While we may see a few people leaving the project, we would expect teams to remain stable for a few years yet. Tideway is unlikely to have any major impact on supply and demand in infrastructure recruitment in 2019.

 

Highways

RIS1

The £15.2bn Road Investment Strategy 1 (RIS 1), is in much the same position as when we last took a look at it. The current investment period will finish in 2020. The 5 year programme promised 60 schemes starting in its fifth and final year (compared to 10 schemes in the previous year). Time will tell if that can be achieved.

Highways England have a portfolio of major projects on the go, including; A14 upgrade, A303 Stonehenge tunnel and the Lower Thames Crossing. There is likely to be mention of RIS2 in the autumn budget.

Lower Thames Crossing

Plans for the new Lower Thames Crossing seem to be finally taking shape. The preferred route will be a bored tunnel running from Thurrock to Gravesham and is expected to cost c£6bn. Highways England will now be focused on developing designs for the proposed project and considering how to best procure for it.

The project is at an early stage and they are not recruiting in any volume yet. Highways England have limited internal capability in tunnelling projects, so we would expect they will be recruiting some project management and engineering staff from a tunnelling and heavy civil engineering background.

 

Energy

Horizon Wylfa Newydd

Horizon submitted their Development Consent Order (DCO) application in July, which will be reviewed by the Planning Inspectorate this autumn. Despite the DCO not yet being approved, the company have been given prior permission by planning officials to clear a site for the new Wylfa B reactor, which should speed up the construction process.

In preparation for works, Horizon Nuclear Power has appointed Bechtel as the project management contractor for the proposed Wylfa Newydd nuclear plant.

Hinkley Point C

Hinkley has been through constant stop-start over the last five years and now seems to be progressing well into construction delivery. We expect demand to continue for several years.

Moorside Nuclear

The troubled nuclear project has hit yet another hurdle. The project was stalled last year because Toshiba had to sell their stake due to financial issues. South Korean energy firm Kepco looked to be the project’s saviour when they were revealed as the preferred bidder last December. However, Kepco was stripped of its preferred bidder status in August after negotiations failed to reach a conclusion.

Just this week, NuGen revealed that they will be making a dramatic reduction in headcount on the project, decreasing employees from over 100 to less than 40.

Tidal Lagoon

Despite new backing from the Welsh Government to help kick start the long awaited Tidal Lagoon Power, plans to build the world’s first tidal power lagoon were thrown out by the UK government in June this year. It seems unlikely that this project will be taken any further.

 

Building

The Palace of Westminster Restoration Project

At the start of the year, MP’s voted to decamp fully from the Houses of Parliament in order to complete the £3.5bn restoration project. The renovation works are scheduled to start in 2025 with the hope Parliament will return to its home in the early 2030s.

A shadow sponsor board has been established to oversee the project, and stalwarts such as Simon Wright, CEO of Crossrail and Lord Deighton Ex- CEO of LOCOG (London Organising Committee of the Olympic Games) have been appointed to give the scheme some major projects nous.

A special purpose delivery authority will be formed in 2019 to act as the project client. We expect that recruitment for key positions will be underway next year.

 

There’s a lot going on in transport and infrastructure this year and the projects mentioned above barely scratch the surface. If you are looking to bring on board senior management to develop and deliver projects then click HERE to see how we can help.

 

*https://www.standard.co.uk/news/politics/crossrail-2-project-faces-permanent-delay-without-support-of-capable-mayor-a3933821.html

By Jim Newsom17th September 2018

Author: Jim Newsom

Jim Newsom leads our work in construction and infrastructure having worked in executive search since 1998, recruiting for both public and private sector companies in infrastructure, transport, engineering and construction. Prior to forming Newsom Consulting, Jim spent 11 years working for the one of the UK’s largest independently owned executive recruiters and then two years at a boutique search firm. Jim is a graduate in civil engineering from Liverpool University.

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