One of the local road schemes that survived a recent Department for Transport (DfT) cull appears to be in trouble after a major development that is mentioned 17 times in its outline business case (OBC) was shelved.
But Hampshire County Council has said it is committed to progressing the A326 Waterside Improvement scheme, which is awaiting a decision on Local Road Network/Large Local Majors (MRN/LLM) funding, despite Associated British Ports (ABP) shelving the Solent Gateway 2 project.
The council submitted a planning application for the scheme in April and in May submitted its OBC to the DfT as part of its bid for LLM funding of £161.5m, representing 85% of a scheme cost of £187m.
The “Waterside” area lies between Southampton Water and the New Forest National Park and the scheme includes improvement works at eight junctions along the A326 corridor, widening two sections and active travel improvements.
The OBC stresses the national economic significance of the Waterside area served by the A326, including the Fawley Refinery and petrochemicals facility and the proposed Solent Gateway 2, which was planned as part of the Solent Freeport and is referenced 17 times in the document.
However, this month ABP withdrew its application for a development consent order for Solent Gateway 2, stating that it is looking to create more space in Southampton and at the existing Solent Gateway site, although it retains a long-term aim to develop the project.
But a council spokesperson told me:
We remain committed to progressing the A326 Waterside Improvement scheme. The A326 is the principal route serving the Waterside and is expected to come under increasing pressure in the years ahead. Without improvements, congestion and journey delays are forecast to worsen, making travel less reliable for residents, visitors and businesses.
The scheme is designed to improve safety, reduce congestion and support the area’s long-term economic growth and prosperity by addressing existing and future transport pressures, and is not dependent on the Solent Gateway project proceeding. Its purpose is to deliver benefits for communities and businesses throughout the area, rather than primarily providing access to Solent Gateway.
The scheme may not be wholly dependent on development of Solent Gateway 2 but the shelved project is a major part of a business case that already demonstrates low value for money. Its adjusted BCR is 0.958, meaning that even after recognised wider economic impacts are included, quantified benefits remain slightly below costs.
But the OBC introduces an additional concept of an “indicative” BCR, of 1.927, produced by adding £157.6 million of Level 3 development-related benefits.
An indicative BCR calculated by adding Level 3 benefits to an adjusted BCR is not a standard DfT measure and appears to be a scheme-specific metric created by the council.
But if this is the relevant value for money metric, why does the OBC separately report an adjusted BCR of 0.958 at all?
The answer is presumably because the adjusted BCR is the standard DfT measure, whereas the “Indicative BCR” transforms a scheme with a BCR of 0.958 into one with a BCR of 1.927.
The more favourable figure is not only derived differently but is explicitly labelled with a term that ordinarily denotes that it should be treated with less reliance than the primary measure.
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