The council had originally expected £364m for the highways PFI, but this has been reduced due to the Spending Review. This in from the council, in their own words. Ed
ISLE OF WIGHT roads have been given a multi-million boost by two Government announcements.
The Department for Transport has indicated that the IW Council’s PFI scheme is to be given £260 million while a further £800,000 has been awarded to treat pot holes on the county’s highway network.
Both announcements have been welcomed by the IW Council which has been waiting since October to find out the value of PFI grant it is to receive.
The confirmation allows the authority to press ahead with the scheme that will be both the largest engineering project ever undertaken on the Island and also the most valuable contract ever procured by the local authority.
Virtually all roads resurfaced
Under the PFI scheme virtually all the Island’s 800 km of roads will be resurfaced and rebuilt where necessary; footways pavements, designated cycle routes, grass verges, CCTV networks, streetlights and street furniture upgraded, street lighting replaced with efficient LED lighting and upgraded roads maintained over the 25-year-life of the project.
In addition, the PFI service provider will take on the statutory role of the highway authority and operate the road network over this period.
Money for potholes
The money for pothole repair is greater than expected and will make a major contribution to patching up the Island’s highways until the PFI provides a longer-term solution when construction starts in the spring of 2013.
The council has known since the Government’s Comprehensive Spending Review in October that the amount of Government PFI grant would have to be scaled back and has been working with the three companies who are bidding to become partners in the scheme on the basis of the funding reduction as indicated today.
Latitude for efficiency savings
The council said it could deliver the full scope of scheme to the new budget.
This is largely because the scale project is so huge there is much latitude in which to make efficiency savings. Changes to the timing in which money is released by Government will also result in savings without altering the scope of work.
“The primary aim of the Highways PFI has always been to bring our highway network up to an acceptable standards and that is what we will achieve,” said Cllr Edward Giles, IW Council cabinet member responsible for transport.
“What this announcement means is that we can move forward in developing a scheme that makes best use of the money and brings maximum benefit to all those who use the Island’s road network, footways and cycleways.
“Such massive inward investment to allow an engineering project of this size will also bring many other real and substantial benefits to the Island in terms of training, employment and commercial opportunities for Island businesses and suppliers. The cumulative value of these benefits will be many times the value of the actual PFI grant.
“In such a difficult economic climate the Island is fortunate to have been able to secure such a huge sum for a project of such importance.”
“Free grant” – no repayment required
Because the Government grant – is a free grant, the council does not have to repay this. With the council maintaining its own contribution for passing on the maintenance and statutory responsibilities, the total investment on the Island’s roads is nearer £0.8bn.
The council’s contribution is essentially the same amount already spent by the authority in the areas to be covered by the PFI but because this will be done under one single new contract, the authority can secure greater value for money from the money it spends.
Stuart Love, IW Council strategic director for economy and environment, said: “This really is a once in a lifetime opportunity for the Island that will bring significant benefits to the Island’s economy over and above the obvious infrastructure improvements.
“The PFI not only represents the only mechanism by which we can secure the huge investment necessary to bring the roads up to the standards residents rightly expect, it will also deliver innovation and improvements in areas such as public lighting and carbon and water management. This really is excellent news for anyone who wants to see a long-term and sustainable approach to improving and maintaining our highways network.”