Briefing on scheme’s value for money
* The original business case by the promoter, National Highways, was rated: ‘low’. Without adding the heritage value of nearly £1bn, the business case would not have achieved this weak out turn.
* The basis for the heritage valuation was arrived at by means of a survey using a methodology questioned by both the NAO and the scheme Examiners in 2019.
* Survey participants had been asked to monetise the heritage benefit that might be brought by the scheme’s promoters. But they were given inadequate information, including misleading images, no views of the portals, and no before and after images of the cutting. (See sample images below)
* The Alliance had always considered Highways England’s figures lacked credibility, but their latest calculations of increased value for money can only be described as pure fantasy.
“In September 2022, the Office for National Statistics reported a rise in the price of materials and fuel for manufacturing of 20.5% in the year to August 2022.” Quoted by National Audit Office, November 2022.
Incredibly, at a time of record inflation and spiralling costs in the construction industry, National Highways claims that the Stonehenge Tunnel has suddenly become much better value for money. Its previous calculations were already highly suspect but its new ones are pure fantasy.
It is well known that proposers of ambitious projects tend to downplay their costs and exaggerate their benefits in order to make their schemes look good. Our report shines a spotlight on how ministers and officials at the Department for Transport (DfT) are being misled. [Note 2]
From no value to low value
In its 2018 application for a Development Consent Order (DCO) for the A303 Amesbury to Berwick Down (“Stonehenge Tunnel”) Scheme, National Highways applied a standard appraisal method of costs and benefits over a 60-year period. Costs included construction and maintenance, whilst benefits included expected time savings per vehicle, improved road safety and anticipated economic benefits.
The high cost of the scheme, due to the tunnel ostensibly for protecting the World Heritage Site (WHS), would have led to a net loss overall. So National Highways commissioned a survey to monetise the value of the heritage benefit the scheme would bring. The results arrived at a total monetised heritage benefit of £955m, in 2010 values. Added to the transport benefits this, remarkably, turned the tunnel scheme into a net profit. But survey respondents were given inadequate information about the scheme and, despite the injection of an extra £955m of benefits, the surplus only shows a small return of 8p for each pound invested, i.e., a BCR of 1.08, deemed low value.
Images shown to survey respondents by National Highways
Images not shown to respondents
Given that the scheme’s Examiners and UNESCO say the proposal will harm the WHS, and that even the former Transport Secretary agrees with them (despite wanting to approve the scheme), the results of the survey cannot be considered credible. Yet, in spite of the damage it would do to the WHS, National Highways is still claiming that its scheme will produce £955m worth of benefits as it desperately tries to keep the project afloat,
Following the DCO’s quashing in the High Court, in part because of the failure to properly consider alternatives, the Transport Secretary has asked for more information to re-determine the scheme.
Reappraisal of the scheme defies credibility
As things stand, we fear that Ministers and DfT officials could be misled into thinking that the scheme is viable. National Highways has recently conjured up new figures claiming that costs have fallen, while benefits have magically increased, and that the scheme now has a BCR of 1.55. This is simply not credible.
The scheme’s latest construction and maintenance costs are now in the order of £2.5bn in current prices and are only likely to soar with current inflation. In a recent report, the National Audit Office recommended that National Highways needs to carry out a value for money review of its major schemes such as Stonehenge to ensure they still provide value for money. Yet any figures National Highways produces will need to be carefully scrutinised.
That’s why we are calling for an open and independent appraisal of the scheme to be carried out. Only with full disclosure and proper scrutiny at a public examination will the Secretary of State be able to come to a sensible decision on this scheme and the future of Stonehenge WHS. This is our heritage at stake and we owe it to future generations to take the greatest possible care of it.
1: Permission to use the Jonesy cartoon is exclusive to comment and articles associated with this item.
2: The full report was amended in January 2023 to include National Highways’ 2022 Business Case available here [December 2022 version has been replaced]
3. Press release here.