‘Notice to proceed’ has been issued to the four main works civils contractors

 

 
HS2 Ltd has been given the green light to commence detailed design and construction work on the first phase of the high speed rail route.

The ‘Notice to proceed’ has been issued to the four main works civils contractors – SCS Railways, Align JV, EKFB JV, and BBV JV. It follows the decision by prime minister Boris Johnson to proceed with the project in February.

To date, the contracts between HS2 Ltd and the contractors for Phase One of the route between London and Birmingham have focused on undertaking scheme design and site preparation. The issuing of the Notice to Proceed marks the point in the contracts where the work transitions from scheme design and preparatory work, to full detailed design and construction.

The government said that at a time when the construction sector faces uncertainties during the coronavirus outbreak, issuing the Notice to Proceed provides “a vote of confidence in construction companies and the wider supply chain supporting HS2”.

This week has also seen the Department for Transport publish the new full business case for the first phase of HS2. In it the government goes further on why it has decided to press ahead.

“We have carefully considered whether it is right to proceed with HS2
Phase One in these circumstances and, in line with Public Health Guidance which allows construction activity to continue where it is safe to do so, have concluded that continuing is the right course of action,” it said.

“Much of the initial work on the main construction of Phase One will take place off-site, developing further designs and logistics plans.”

HS2 minister Andrew Stephenson said the government could not delay work on the project.

He continued: “HS2 will be the spine of the country’s transport network, boosting capacity and connectivity while also rebalancing opportunity fairly across our towns and cities.

“Following the decision earlier this year to proceed with the project, this next step provides thousands of construction workers and businesses across the country with certainty at a time when they need it, and means that work can truly begin on delivering this transformational project.”

HS2 Ltd said the issue of the Notice to Proceed was a significant step for the first phase of the project and an estimated 400,000 supply chain contract opportunities for UK businesses will be created over the next decade as work ramps up.

It is estimated that around 95% of those contract opportunities will be won by UK based businesses and around two thirds of those will be small and medium sized businesses.

In these difficult times, today’s announcement represents both an immediate boost to the construction industry

“In these difficult times, today’s announcement represents both an immediate boost to the construction industry – and the many millions of UK jobs that the industry supports – and an important investment in Britain’s future,” said Mark Thurston, chief executive of HS2 Ltd.

“HS2 has been over 10 years in development and design. While the country’s focus is rightly on defeating Covid-19, the issuing of Notice to Proceed ensures that our contractors and their supply chains have the confidence that they can commit to building HS2, generating thousands of skilled jobs across the country as we recover from the pandemic.”

However, the decision drew criticism from those opposed to the project. Lord Berkeley, a long-time critic of the project, said the decision to proceed just a day after the Office for Budget Responsibility suggested that the UK faced the worst recession for 100 years and a forecast drop in GDP of 35% was “certainly well timed to get minimal scrutiny”.

“At a time of the coronavirus health and business costs well exceeding those of HS2, it is surprising that ministers are still throwing more good money, our money, after bad,” he said. “The NHS could clearly benefit from the billions that could be saved for investments in the NHS and other parts of the UK economy by scrapping HS2, whilst still potentially investing in alternative and much better targeted rail projects.”

The newly published business case says the government expects the opening of Phase One to be staged; services between Old Oak Common and Birmingham will start between 2029 and 2033, with Old Oak Common acting as a temporary London terminus. Services into London Euston will follow.

A new Funding Envelope of £45bn has been agreed by the DfT and the Treasury based on a point estimate of £35bn and a contingency allocation above this to manage risks to the programme.

The four joint ventures, originally awarded contracts by HS2 Ltd in July 2017, are:

  • SCS Railways (Skanska Construction UK Ltd, Costain Ltd, STRABAG AG);
  • Align JV (Bouygues Travaux Publics SAS, a subsidiary of Bouygues Construction, Sir Robert McAlpine and VolkerFitzpatrick, a subsidiary of VolkerWessels UK);
  • EKBF JV (Eiffage Genie Civil SA, Kier Infrastructure and Overseas Ltd, BAM Nuttall, Ferrovial Agroman); and
  • BBV JV (Balfour Beatty Group Ltd, VINCI Construction Grands Projets, VINCI Construction UK Ltd, VINCI Construction Terrassement).

 
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