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On 1st April 2008 we launched the Project Control Framework. The Framework sets out how we, together with the Department for Transport, manage and deliver major improvement projects.
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DBFO - Value in Roads
Chapter 6 - Impact on operator market
One of the objectives of the DBFO programme was to foster a private sector, domestic road operating industry. At the start of the DBFO programme there was no such industry in existence, as the Agency had been the operator of the motorway and trunk road network and the local authorities were responsible for the road network in their regions. There were a number of private companies and consultancy firms which had acted as contractors and advisers for the Agency and local authorities on maintenance of roads, but their role was to work to a fairly specific brief for an agreed price. They were not required to make strategic decisions on the timing and type of maintenance required.
Interested companies formed consortia to bid for DBFO contracts. With one or two exceptions, the consortia have stayed intact and sought to prequalify for projects on each of the tranches. Listed below are the winning consortia for each DBFO project:
| DBFO Projects | Winning Consortia |
|---|---|
| A69 | Roadlink (Henry Boot, Christiani & Nielsen, Cogefarimpresit, Morrison Construction, Pell Frischmann and ASTM - SINA) |
| M1-A1 | Yorkshire Link (Trafalgar House and Balfour Beatty) |
| A1(M) | RMG (Amec, Alfred McAlpine, Brown & Root and Dragados) |
| A417/A419 | RMG (Amec, Alfred McAlpine, Brown & Root and Dragados) |
| A50/A564 | Connect (Balfour Beatty, WS Atkins and Philipp Holzmann) |
| A30/A35 | Connect (Balfour Beatty, WS Atkins and Philipp Holzmann) |
| M40 | UK Highways (Hyder, John Laing, Tarmac, Caisse des depots et consignations and Transroute) |
| A168/A19 | Autolink (Amey, Sir Robert McAlpine and Taylor Woodrow) |
It is interesting to speculate on how the road operating industry will develop. From the Agency's perspective, competition has to be sustained to ensure good value for money. Fresh competition may come from various directions: bidding consortia comprising foreign companies, or new bidding consortia consisting of UK companies led either by construction companies or by an operator-type company.
The DBFO road contracts have created new opportunities for traditional contracting and consultancy organisations to develop stable, long-term businesses, providing and maintaining the UK's road infrastructure. This will be of benefit to those companies which can develop their expertise in this area to bid for further DBFO projects in the UK, and to search for emerging opportunities overseas.
DBFO contracts benefit not only the private sector participants, who are provided with a long-term business opportunity, but also the State and, ultimately, the taxpayer who receives better value for money spent, and the road user who has the benefit of road schemes being delivered earlier than would have been anticipated under traditional procurement methods.
If you wish to discuss any of the issues raised in this case study, please contact:
Angela Brewis
Private Finance Panel Executive
3rd Floor
61-71 Victoria Street
London
SW1H 0XA
Tel:0171 468 6500
Fax:0171 222 3470
E-mail:brewis@pfpe.demon.co.uk
Produced by:
Highways Agency
St Christopher House
Southwark Street
London SE1 0TE
Private Finance Panel Executive
3rd Floor
61-71 Victoria Street
London SW1H 0XA
