Roads-annexes

					Evaluation of Investment
In the Road Network




Annexes
ANNEX 1   NRA PROJECT APPRAISAL MODEL AND METHODOLOGY




ANNEX 2   NATIONAL PRIMARY ROADS PROJECT CASE STUDIES




ANNEX 3   INTERNATIONAL CASE STUDIES




ANNEX 4   ANALYSIS OF LOCAL AUTHORITY NON-NATIONAL ROADS
          QUESTIONNAIRE
Annex 1           NRA Project Appraisal Model and Methodology


1.       Background and Purpose

The Terms of Reference for the project called for the consultants to “assess and review the project
appraisal model us ed by the National Roads Authority (NRA ) and the parameter values currently
used in the model; this review should take account of the NDP/ CSF cost -benefit guidelines and
have regard to research currently under way on the incorporation of environment al dimensions into
the model”.


Various existing reports were revi ewed including the following:


    Proposed Working Rules for Cost-Benefit Analysis (CSF E valuation Unit, 1999);
    Cost-Benefit Analysis in the Community Support Framework: a Critical Review (CSF
     E valuation Unit, 1997);
    Guidelines for the Appraisal and Management of Capital Expenditure Proposals in the Public
     Sector (Department of Finance, 1994);
    CBA Parameter V alues and Application Rules for Trans port Infrastructure Projects (DKM Ltd,
     1994);
    Cost Benefit Analysis of Interurban sections (MCAS);
    Valuing the Cost and Benefits of Road Transport Toward European Value Sets (WERD, 2000);
    COBA Manual for COBA 10.


In addition, the CBA approach and models used by the Western European Road Directors
(WERD), the World Bank and the national association of road transport and traffic authorities in
Australia (A ustroads) were reviewed to assess if the methodology used is in line with world -wide
best practice.


This Annex presents the findings and recommendations:


    Section 2 examines the project appraisal model used by the National Roads A uthority and t he
     guidelines governing the appraisal of individual projects from the Department of Finance and
     the European Commission;
    Section 3 deals with the CBA parameters for use in t he appraisal of t rans port investment
     proposals in Ireland;
    Section 4 provides a c omparative analysis of road transport project appraisal methodologies
     and models, including the approach of WERD,          the World Bank's model as well as the
     Austroads model in terms of methodology and comparative paramet er values;
    Section 5 contains our conclusions and recommendations.




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2.      Overview of Current Approach

2.1     Introduction


The first task of our TOR was to assess the project appraisal model used by the National Roads
Authority and to comment on the basic guidelines on project appraisal provided by the Department
of Financ e and the E uropean Commission. The Department of Finance guide deals wit h the
different stages of project appraisal and management. The Commission guide aims to assist
officials in assessing projects and to inform experts of the Commission’s requirements for cost-
benefit studies.


2.2       NRA Project Appraisal Model


Discussion with the NRA regarding the cost benefit analysis tools concluded that the NRA looked
at other local and in-house models but decided that the COBA10 was the most appropriate model,
as all UK consultants use it, which in turn leads to consistency. The transition to COBA11 will be
made once it is more widely used. COBA10 is principally concerned with estimating the effect of a
road network improvement on the users of t he road system, namely changes in time, accident and
vehicle operating costs. These are compared to the construction and maintenance costs, which
are borne by central and local government.


Cost benefit analysis of road projects in Ireland was first int roduced in 1985 with the adoption of a
modified version of a model used in the UK. Dr James Crowley of UCD developed a new
methodology, in response to requirements under the 1989-1993 CS F. This was subsequently
added to by DKM, the external evaluator to the 1994-99 Transport Operational Programme. The
DKM paper sought to develop CBA parameter values and application rules for use across the
transport sector.


In t he NRA, spreadsheets are currently prepared for the proposed projects including a description
of the scheme, the internal rate of ret urn, the existing geometrics, capacity, pavement condition,
traffic levels and accident recorded and a description of the road characteristics on completion.
These spreadsheets provide the information which forms the basis for the decision to proc eed with
the project. Environmental and engineering factors complement the estimated rates of return.


2.2     Department of Finance Guidelines


The Department of Finance issued guidelines in 1994 governing the appraisal of individual
projects. These are included in the publication entitled ”Guidelines for the Apprais al and




                                                                                      Page          2
Management of Capital Expenditure proposals in the Public Sector ”. The guide aims t o assist
officials concerned with capital projects.


The report recognises four stages of project appraisal and management. Appraisal is divided into
preliminary and det ailed stages. The former aims to assess if the project has sufficient merit to
justify a full and detailed appraisal while the detailed study provides the basis for the decision on
whet her t o drop a project or to approve it in principle. Planning involves detailed planning and
costing of the project. Implementation requires clear arrangement for monit oring and cost control.
Finally, the guide suggests that as a final step a post-project review should be undertaken.


The specific guidelines prescribed are int ended t o serve as a broad review of the main features of
project appraisal:


     define the needs the projects should meet, and its objective;
     list the options i.e. realistic alternative ways in which the objectives can be achieved;
     list the constraints;
     quantify financial costs, and specify sources of funding;
     analyse the main options, i.e. value and quantify the cost and benefits of each option. Types of
      analysis are financial analysis, cost benefit analysis, cost effectiveness analysis, exchequer
      cashflow analysis. It is important to clearly identify, and agree with the Sanctioning Authority,
      which forms of analysis are appropriate. The main c riteria used in deciding on the appropriate
      forms of analysis are whether or not the project is to be operated on a commercial basis;
     in cost benefit analysis, all the relevant cost and benefits, including direct costs and benefits,
      should be taken into account. Cash values, based on market prices (or shadow prices, where
      no appropriate market pric e exists), are placed on all costs and benefits and the time at which
      these cost/benefits occur are identified;
     identify the risk associated with eac h option;
     decide on the preferred option, specify it, and a detailed time profile for actions and for
      expenditure;
     the Spons oring Agency should recommend the preferred option for consideration and approval
      by the Sanctioning Authority.


This is a generic approach to CBA, that is consistent to a significant extent with COBA.


2.3       European Commission Guide to Cost-benefit Analysis


The European Commission also issued checks that the Commission officials should follow when
assessing the quality of Cost-Benefit Analysis of major projects. Thes e are included in the
publication entitled ”Guide to Cost-Benefit Analysis of Major P rojects”.




                                                                                          Page        3
The report identifies the following 5 steps, of which s ome are preliminary but necessary
requirements for Cost-Benefit Analysis.


Identification of the project: A good starting point for identification of the project is to state its
functions, which are coherent with the objectives of the investment. This should be followed by a
description of the type of action i.e. completely new road, part of an extension etc. The following
data should be contained in the analysis report:


   length (in Km) and layout of the road, with an attached plan of appropriate scale;
   physical links with other roads and the position of important junctions;
   technical features and conformation of the road;
   important technical elements, such as bridges, tunnels, crossing of other infrastructure etc.


Feasibility and option analysis: The option analysis should include a comparison with:


   the previous situation, with the realisation of the project;
   alternative routes;
   possible alternative systems of transport (by rail, sea, etc.)


Financial analysi s: Two different points of view should be considered, namely that of the
infrastructure investor and that of the operational management. A sample of 12 major projects out
of 97 in the sector indicated that the minimum, maximum and average financial rate of return was -
0.60, 10.49 and 3.93 respectively.


Economic analysi s: According to the report, in addition to all the parameters of financial analysis,
the following costs and benefits should be considered:


   the time saved;
   the reduction of number of accidents i.e. non -fatal and fatal accidents;
   the increas ed cost for the user quantifiable in terms of greater consumption of fuel as well as
    the increased wear and tear on mechanical parts;
   externalities i.e. loss of agricultural land, possible relocation of residential, commercial or
    industrial areas etc.


Other evaluation elements: This mainly refers to other elements of the impact of the environment
(noise, pollution etc.). In the case of moderation of existing roads, the impact of road works on
traffic flows should also be analysed and shown to be kept to a minimum.


In summary it can be concluded that COBA follows the principles provided by the European
Commission.


                                                                                      Page          4
3.        Detailed CBA Parameters in NRA Model

3.1       Valuation of Time Savings


NRA Model:
The valuation of time savings is a key aspect of the appraisal of all transport infrastructure.


In-work time should be valued separately from non-work time. DKM proposed that in-work time
savings should normally be valued at the average wage rate for the workers whose time is saved,
plus an allowance to cover the cost to t he employer of hiring labour (i.e. overheads and
employment taxes). The approach is subject to the following assumptions:


     individual employees will behave as if they personally accepted this valuation;
     value in other uses of travel time s aving may be less than the average wage rate due to
      imperfections in the labour market. A more appropriate measure of savings in working time
      would be the opport unity cost of labour;
     resources released due to travel time savings will be converted into increased output;
     travel time will be t reat ed as a disutility. In addition, the value placed on journey time by the
      employee is not considered; and
     time saved in the transport of freight may be more valuable than the wage cost of the driver.


The proposed working rule prescribed by DKM for working time is valued (in 1994 prices) a t
€11.68 per hour.


There are also differences in the value of non -work time by mode. Values can be higher for non-
work trips on the journey to work, or to make transport connections, while walking time or waiting
time can be valued more highly than in-vehicle time.


The proposed working rule for non-work time is valued (in 1994 prices) at €4.70 per hour. This
value should apply equally to large and small time s avings and to urban and rural areas.
Adjustments should be made only where the project involves a traffic pattern very different from
the average, for example a school bus service.


Valuation of Time Saving – COBA Model:
The COBA Manual also distinguishes between working and non -working time and uses the same
approach to determine value of time. The basic sources of wage rate data are New E arnings
Survey of the UK Office for National Statistics and National Travel Survey of the Department of the
Environment, Trans port and the Regions. In summary the working time is valued at its cost to t he
employer of the travelling employee, on the grounds that the value of the output produced in



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working time must be equal to the cost of the employer of hiring labour for that time. An
assumption is that all t ravel in course of work is carried out in th e ”employer's time” rather than t he
”employee's time” so that time savings are thus working rather than non-working time savings.
Value of working time is estimated for different types of vehicle occupant as given in Table 1. For
car drivers and passengers and bus passengers the value of working time is based on mileage-
weighted incomes of a sample of workers to take account of the variation in mileage travelled by
work ers with different earnings.


The value of non-working time used in COBA has been de rived from studies of how people choose
to travel when faced with a choice between a slow, cheap mode and a fast, expensive mode or
between a short expensive car route and a long, cheaper car route.


The COBA programme has three vehicle modes and three pers on modes. By default only two
modes, ”working” and ”non-working” are us ed. Other goods vehicles and their occupants are
appraised in the working time mode only. Analysis of the National Travel Survey produces values
for average vehicle occupancies and t he proportion of car travel in working time. In combination
with data from other sources it has also been possible to estimate the proportion of light goods
travel not in working time. Thes e are combined with the values by type of vehicle occupant and
with the value of in-vehicle non-working time to produce values of time per vehicle.


Table 1: Annual Average Values of Time per Person and per Vehicle in COBA based in 1994 occupancies
(1994 values and prices)
                                                                                  VALUE OF TIME (CENTS/HOUR)
TYPE OF VEHICLE                         OCCUPANCY           TIME MODE
                                                                               PER OCCUPATION       PER VEHICLE
                                      1 Driver            Working                           1637.7
Working Car
                                      0.11 Passengers     Working                           1359.4        1787.28
                                      1 Driver            Non-w orking                         400
Non-w orking Car
                                      0.74 Passengers     Non-w orking                         400          695.9
                                      1 Driver            (Derived from above assuming 14.6% of car
Average Car
                                      0.65 Passengers     kilometres are in work model                      855.3
                                      1 Driver            Working                          1273.7
Working Light Goods Vehic le (LGV)
                                      0.42 Passengers     Working                          1273.7            1808.6
                                      1 Driver            Non-w orking                         400
Non-Working Light Goods Vehic le
                                      0.60 Passenger      Non-w orking                         400             640
                                      1 Driver            (Derived from above assuming 72% of car
Average Light Goods Vehicle
                                      0.47 Passengers     kilometres are in work model)                      1481.4
Other Goods Vehicle (OGV)             1 Driver            Working                             1200             1200
                                      1 Driver            Working                           1248.3
                                      12.1 Passengers     Non-w orking                         400
                                      0.1 Passenger       Working                           1351.5            6223
Average Vehic le                                                                                               996
Source: COBA Manual, 1997




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3.2     Transport Infrastructure Investment and Accident Savings


NRA Model:
DKM states that more recently there has been a change t owards valuing t ransport safety on t he
basis of ”willingness to pay” with revealed and stated preference data being used to collect
information on ”willingness to pay” for reduction in accident risk.


In this approach, the amounts that those affected would individually be willing to pay for
improvements in their own and others' safety are det ermined. An overall value for safety
improvements are then determined by adding the amounts, which reflects what the ”s afety
improvement ” is worth to the affected group, relative to the alternative ways in whic h each
individual might have spent his/her limited income.


DKM concludes that improvements, which enhance safety, may have to be evaluated from a
probabilistic perspective, meaning that the likelihood of an accident is reduced by an improvement,
even where the historical records show that no accident has ever occurred.


The Working Rule pertaining to accident costs is valued (in 1994 prices ) at fatality, €952,304, non -
fatal injury, €31, 743 and damage only, €1,905.


COBA Model:
According to the COBA Manual, standa rd values are produced by the Overs eeing Organis ation
(Department of the Environment, Transport and the Regions , Northern Ireland) for use in valuing
the savings of accidents resulting from road improvements and road safety measures. The values
used in COBA and the basis of valuation are given in Highway Economics Note No. 1 September
1995 (1994 pric es and values). Table 2 depicts the components identified for accident costs. In
addition to the ”casualty” costs are the costs associated with damage to property, insurance
administration, police time and an allowance for damage only accidents.


In COBA the average accident severity split (that is, the number of fatal, serious and slight
casualties per accident) for a particular road/junction classification is used to determine overall
accident cost.


It is noted that the cost per fatal casualty determined by DKM is almost similar, however the cost
for serious and slight casualty differs.




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Table 2: Components of Accident Costs (1994 values and prices)
                                                  COST PER CASUALTY, €
                                   Fatal casualty                                           995,589
                                 Serious casualty                                           113,489
                                  Slight casualty                                             8,787
                                            COST PER ACCIDENT,€
                                             Insurance
                                                                                 Damage to Property
                                             Administration
                                                                         Urban            Rural       Motorw ay
Fatal accident                                      207                  5363             9098         11572
Serious accident                                    128                  2875             4147          9873
Slight accident                                      79                  5506             2749          4995
Damage only                                          37                  1214             1812          1742
                                                                                    Police Cost
                                                                         Urban            Rural       Motorw ay
Fatal accident                                                           1313             1244          1822
Serious accident                                                          110              307           287
Slight accident                                                            39               39            39
Damage only                                                               2.54            2.54          2.54
Source: COBA Manual, 1997



3.3        Vehicle Operating Cost (VOC) Savings


The working rule prescribed by DKM for VOC estimate is that savings in vehicle operating costs
should be at 1.27c per km for cars, at 1994 prices, with a 50% premium for large vehicles. The
costs exclude taxes. The above rule applies if the project's main impact is to shorten distance in
travel. As reminded by DKM, VOC are affected by road surface type and condition, gradient,
curvature, traffic interactions and various circumstances which oblige vehicles to carry out speed
change cycles. The main items of savings include fuel, oil, tyres, maintenance and depreciation.
According to DKM, standing charges, which do not vary with the volume of usage, should be
ignored. These include road tax, insurance and the opportunity cost of capital. Taxes are a transfer
of resources between sections of society as a whole, and should be ignored in a social cost -benefit
analysis


However, M C O’Sullivan Consulting Engineers noted that the DKM rules do not take into
consideration t he impact on V OC of either speed or road characteristics (vertical profile and
horizontal profile) which modify fuel consumption. Therefore, MCAS propose that the impact on
fuel consumption of improvements to the geometry of a road section also be taken into acc ount.


VOC in COBA also comprises six items: fuel, oil, tyres, maintenanc e, depreciation and size of
vehicle fleets. It is the mileage -related res ourc e VOC that is included in COBA, therefore also
exclude insurance, vehicle excise duty etc. The costs also exclude any element of indirect
taxation. COBA takes into account the impact of fuel consumption on speed which modifies t he
fuel consumption. There is no specific allowance in COBA for fuel us ed at junctions.




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3.4     The Discount Rate


Using CBA to prioritise road projects generally implies a fixed discount rate. Working rule 7 and 8
proposed by DKM states that, where benefits for projects are reasonably cert ain, such as public
utility-type projects, a discount rate of 5% as recommended by the Department of Finance should
be us ed. MCAS also propose to us e a 5% rate. However, where benefits are less certain a higher
rate should be specified in the evaluation, as estimated by the analyst.


3.5     Shadow Pricing Approach


The Working rules set by the NDP/CSF E valuation Unit states that market prices should always be
used in cost-benefit analysis unless there is a clear reason for doing otherwise. Shadow prices
should be used where market prices do not reflect opportunity costs due to some clearly identi fied
market failure. Labour costs should generally be included at market prices unless an explicit case
is made in the cost-benefit report for an alternative approach. In any event, the shadow wage used
should not be less than 80% of the market wage. Where a shadow wage of less than the market
wage is used, the appraisal should contain a sensitivity analysis on the basis of a shadow wage of
100 percent. In all c ases, labour costs in respect of overtime hours should be included at the
market rate.


In t he propos ed working rules set by t he CSF E valuation unit of 1999, it is stated that the shadow
price of profit should reflect the opport unity cost of the capital. This will typically imply a shadow
price of 100% except in circumstances where super-normal or windfall profits arise. In order to
take account of the distortionary effect of taxation, a shadow price of public funds of 150% should
be applied to Exchequer c ash flows (t axes, grants and subsidies) to make them commensurate
with private cash flows.


3.6     Environmental Parameter Values


The main environmental impacts associated with int er-urban road infrastructure investments in
Ireland are noise, air pollution and the impact on neighbourhoods , on farmland and on wildlife
habitats.


According t o DKM, Hedonic Property Price Indices are the main techniques used to value noise
and air pollution impacts and other environment al externalities. The revealed preferences of
people in the housing market are examined when they trade off the noise/air pollution attribut es of
different properties against their property prices. However, the approach is fraught with
methodological difficulties.




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In the UK, environmental considerations are not generally given monetary values in the appraisal
of transport projects; however they are taken into account in the appraisal process.


The NDP/ CSF E valuation Unit states that only thos e externalities which represent a significant
project outcome, and which can be valued on the basis of a reliable and well -established
methodology, should be included in the actual cost-benefit calculation. Significant externalities
which cannot be given a monetary value should be excluded from the cost -benefit calculation.
They should nonet heless be fully assessed in the cost-benefit report in such a way as to ensure
their full consideration in the decision-making process.


The working rule prescribed by DKM is that a qualitative assessment of environmental impacts
should be prepared alongside the CBA analysis. The import ance of this assessment varies wi th
projects; for example, noise issues will be more important in urban areas. The assessment should
quantify to the extent feasible.


At the moment there are several ongoing initiatives to investigate environmental impacts. Under
the Environmental Research, Technical Development and Innovation (RTDI) submeasure of the
Operational Programme for the Productive Sector (2000-2006) two significant researc h projects
are due to commence this year (2002). These are:


   "Assessment of the Impacts of Highway Drainage on the Aquatic Environment", that will
    investigate the impact of current drainage systems and recommend on treatment of runoff in
    highway design;
   "Environment-Trans port Interface Capability", aimed at establishing a critical mass of research
    expertise in transport-related environmental matters.


In addition, two other studies are being undertaken, co-funded by the NRA, namely:


   "Scope of Trans port Impacts on the Environment", aimed at reviewing the environmental
    impacts of the transport sector, and the integration of environmental considerations into
    transport planning and operations;
   "Study of Environmental Impacts and Parameters for Inclusion in the Economic E valuation of
    Road Schemes", that reviews current approaches for assigning monetary values to
    environmental impacts, and the use of these values in project cost -benefit analysis.




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3.7       Comparative Analysis


3.7.1     Introduction
In this section, a comparative analysis will be made of the approac h and models used by the
Western European Road Directors (WERD), the World Bank and the national association of road
transport and t raffic authorities in Australia (A ustroads). These models were reviewed t o ascertain
if the methodology used in Ireland is in line wit h worldwide best practice.


3.7.2     WERD Approach
In early 1997, the Western European Road Directors (WERD) commissioned a study on t he
compilation and analysis of the methods of measuring the impacts of road transport projects in the
Member States. The objective of the report was to recommend the monetary values to evaluate
the socio-economic impacts of road infrastructure investment. This s ection gives an overview of
the value sets recommended for travel time, accident cost and vehicle operating cost for the
Member States respectively.


Value of time: Table 3 depicts the behavioural values of time to be used for modelling as
estimated by WERD. The behavioural values reflect the cost as perceived by an individual, and
were calculated from the appraisal values at country -specific level. The appraisal values were
based on the resourc e cost or opportunity cost approac h. The basic assumption was that t he
perception of non-working time values differs from their resource cost in that behavioural costs
include direct taxes net of subsidies.


It is noted that the mode-specific value of time In Ireland is close to the average, except for c ar
drivers, bus driver and bus passengers, which is less than the average.


Table 3: Recommended beha vioural value of time (ecu 1995)
Description   AUS    BEL    DEN    FIN    FRA    GER    GRE    IRE      ITA    NOR   NRL    POR    SPA    SWE    SWI    UK     AVR
                                                                      Ecu 1995
Car
- working     15.2   18.8   22.8   23.9   22.1   21.4   13.3   14.5    15.4   24.4   22.1    6.6   13.9   18.3   22.8   17.5   15.9
occ
-
commuting       5     4.9    6.3    3.4    7.2    7.4    4.3     6      7.4    8.1    7.2    4.6    4.4    4.7   15.8    5.6    5.6
occ
- other occ    3.7    3.6    3.8    2.5    5.3    5.5    3.1    4.4     5.4     8     5.6    3.4    3.2     4     9.7    4.1    4.1
Bus &
coach
- driver       10    12.3   14.9   15.6   14.5    14     8.7    9.5    10.1          14.5    4.3    9.1    9.8    14    13.6   11.5
-working      10.8   13.3   16.2   16.9   15.7   15.2    9.5   10.3    10.9   24.4   15.7    4.7    9.9   10.6   22.8   14.7   12.5
pass
-non-
working        2.6    2.6    2.8    1.8    3.8    3.9    2.3    3.2     3.9     8     3.9    2.4    2.3    2.8    9.7     3      3
(bus)
-non-
working         4     3.9    4.2    2.7    5.7    5.9    3.4    4.8     5.9     8     5.9    3.6    3.5    4.1    9.7    4.5    4.4
(coach)
Source: WERD, 2000




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Values for safety: WERD stated that most countries incorporate traffic safety into their respective
impact assessments. The degrees of c asualty severity was defined as ”fatality - deat h wit hin 30
days as a result of causes arising out of the accident ”, “serious injury - casualties who require
hospital t reatment and have serious injuries, but who do not die within the aforementioned fatality
period” and ”slight injury - casualties whos e injuries do not require hospital treatment or, if they do,
the effects of the injuries quickly subside'”


Accident-related      costs      included material    damage,    police    and    fire services,    insurance
administration, legal and court costs. Casualty -relat ed costs included medical and healt h care cost
incl. Administration, lost output and human costs - pain, grief and suffering. The total appraisal
value of an accident is the sum of the accident-related and casualtyrelated costs.



The recommended values for safety are given in Table 4. The value of serious accidents in
Austria, Finland, Norway, and Switzerland is substantially higher than the rest of the Member
States, which increas es the average value of accidents to approximately 155,000 ecu. The value
of serious accidents in Ireland is below the average serious value. The recommended values have
been calculated as a population-weighted average of the country-specific values.

Table 4: Values for accidents and casualties (1995 ecu)
Description   AUS    BEL   DEN     FIN    FRA   GER   GRE   IRE ITA NOR         NRL   POR   SPA    SWE    SWI    UK    EU
                                                                Ecu 1000
Fatal         1459   384   741     1329   577   828   410   942 -        2100   310   352   676    1660   1115   978   770
Serious       172    45    87      156    68    97    48    111 -        714    37    41    80     195    496    115   91
Slight        13.3   3.5   6.8     12.1   5.3   7.5   37    8.6    -     6.3    2.8   3.2   6.2    15.1   12.4   8.9   7
Source: WERD, 2000



Vehicle Operating Costs: V ehicle Operating Cost consists of standing costs and operating costs.
Standing costs consist of depreciation (time -dependent share), interest on capital, repair and
maintenance cost, material costs, insurance, overheads and administration. Operating cost
consists of personal costs, depreciation (distance-related share), fuel and lubricants.


The measure of VOC was bas ed on the cost per hour by vehicle type (the sum of operating and
standing costs per hour. The road transport vehicles were divided into four groups, to establish an
appropriate data base, namely passenger cars, buses, LGVs and HGVs.


Table 5 presents the V OC values in behavioural values. It is assumed that behavioural values for
cars used privat ely are different from t hose used for business becaus e i t is assumed that the
decision making process concerning trips is not based on total costs. Behavioural values consider
market prices including all taxes and VA T.


It is noted that the VOC values (behavioural values) for buses, LGV and HGV in Ireland is
approximately 20% lower than the rest of the Member States.




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Table 5: VOC values (behavioural values)
Description    AUS      BEL     DEN       FIN         FRA      GER     GRE      IRE      ITA     NOR       NRL      POR      SPA        SWE        UK        EU
                                                                            Per hour in ecu 1995
Car private        -       -        -        -            -        -       -        -        -       -         -        -          -        -         -          -
Car              2.9    3.63     3.83     4.09         4.01     3.97    2.58     3.07     3.25    3.35      4.02     1.79       2.65     3.35      3.37       3.53
business
Bus            40.32   41.32    40.80    40.04        34.82    49.38   23.88   28.06   30.81    38.48     41.28     20.61    27.66     37.48     28.38       34.46
LGV            27.74   29.84    26.96    26.19        21.28    32.95   15.58   17.59   18.85    23.07     28.54     11.21     17.2     23.07     18.02       21.99
HGV            37.79   38.78    38.48    37.66        30.48    45.54   21.19   27.68   35.85    38.39     34.72     19.17    26.26     34.72     28.10       31.65
Source: WERD, 2000



       Maintenance Costs: WERD also analysed the cost of maintenance and renewals in the Member
       States, which is also essential to take into account in appraisals. WERD defined system and
       operating cost as comprising the following components:



             cost of infrastructure operation (e.g. signalling/traffic control);
             the cost of maintenance (e.g. cleaning, minor repair, wint er servicing);
             cost of renewal (e.g. road resurfacing).


       The most import ant of the t hree components, whic h should be considered as standard, are cost of
       maintenance and renewals.


       Renewals

       Renewal cost per vehicle per 1,000,000 km by road type was es timated by using dat a on t he
       kilometre performance of light goods vehicle and heavy goods vehicle per year and country. It is
       noted that the renewal cost per year differs substantially from the Member States average renewal
       cost. This should be investigate d.

       Table 6: Recommended cost of renewal per year in 1000 ecu (1995)
       Description     AUS     BEL    DEN       FIN     FRA     GER     GRE    IRE    ITA    NOR         NRL     POR     SPA      SWE      SWI          UK
                                                                             1000 000ecu (1995)
       Motorway        140      67       51      31      265     721       5     1     425      57        225       15    236       57    125.5       254
       Other           285     549      467     597     3062    3922      82 136 5171         662        1083      137    546      662     35.6      2872
       Sum             425     616      518     628     3327    4643      87 137 5596         719        1308      152    782      719    161.1      3126
       Source: WERD, 2000




       Maintenance
       The cost of maintenanc e covers the cost of winter servicing, servicing cleaning, sign painting and
       minor repairs. Most of the maint enance and servicing components depend on the length of the
       road net work e.g. cost of signs, cleaning and winter service. The prevailing climate determine s
       these costs.


       On average the maintenance cost per kilometre and road type for Ireland is 20% lower t han t he
       average maintenance cost for the Member States.




                                                                                                                            Page              13
Table 7: Recommended cost of maintenance per kilometre and road type (excluding winter service) in Ecu 1995
Description   AUS     BEL    DEN    FIN    FRA    GER       GRE    IRE    ITA     NOR NRL     POR    SPA    SWE    SWI    UK     EU
                                                         In 1000 ecu (1995) per km of road
Motorway
- 3 lanes      24.7   25.3   24.5   24.4   21.6   28.1     15.1   18.2   19.8   24.4   24.1   13.7   18.9   22.4   50.8   18.3   23.4
- 2 lanes      21.1   21.5   20.9   20.8   18.4   24.0     13.0   15.6   17.0   20.8   20.6   11.8   16.2   19.1   37.2   15.7   19.6
Country
- 2 lanes      19.2   19.6   19.1   19.0   16.8   21.9     11.7   14.1   15.4   19.0   18.8   10.6   14.7   17.4      -   14.2   15.7
- 1 lane       10.0   10.3   10.0    9.9    8.8   11.5      6.1    7.4    8.1    9.9    9.8    5.5    7.7    9.1   14.3    7.4    9.1
City road
- 2 lanes       7.8    8.0    7.8    7.8    6.9    8.9      5.0    5.9    6.4    7.8    7.7    4.6    6.1    7.2      -    6.0    6.5
- 1 lane        6.0    6.1    5.9    5.9    5.3    6.8      3.8    4.5    4.9    5.9    5.9    3.5    4.7    5.5   14.3    4.5    5.8
Source: WERD, 2000


Socio-economic decision rule:
Net present value
Net present value is recommended by WERD as the sole determinant of project wort h. Net present
value per government budget share of total financial cost is recommended as ranking criteria when
there is more than one competing initiative.


Discount rat es
A discount rat e, which builds on specific countries ' growth rates, is recommended by WERD. The
recommended average lifetime for a new road project is 30 years.


Table 8: Discount rates
Description   AUS     BEL    DEN    FIN    FRA    GER      GRE    IRE    ITA    NOR NRL POR          SPA    SWE    SWI    UK     EU
                                                          Average annual discounting rates in %
Discount      2.5     2.12   1.9    2.43   2.35   2.32     2.74   4.24 2.56 1.9          2.58 3.13   2.69   1.57   2.74   1.82   2.32




3.7.3       World bank model – HDM-IV
Introduction
HDM-4 is a Windows-based updated version of the highly popular and extensively used HDM -III
program. It was developed particularly by the World B ank under c o-ordination of the University of
Birmingham. HDM-4 is able to form the evaluation engine of pavement management systems,
and is generally supported for cost-benefit analysis of road projects funded by international funding
agencies. Various updates of HDM-4 are available with V ersion 1.30 being the latest version.
Key parameters
Decision Criteria
HDM-4 pres ents various decision criteria for road investment projects.                          These include t he
following:


           Net Present Value (NPV)
           Benefit Cost Ratio (BCR)
           Economic Int ernal Rate of Return (E IRR)
           Net Present Value Cost Ratio (NPV).




                                                                                                      Page           14
3.7.4   Vehicle Operating Costs
In order to estimate the vehicle operating costs for various road conditions, HDM -4 takes t he
following vehicle operating cost inputs into consideration:


   New Vehicle Price
   Cost of tyres
   Interest
   Fuel
   Maintenance
   Lubricants


The economic unit costs of each of the above vehicle operating cost inputs are entered by the
user, and are then used by HDM-4 to estimate different vehicle operating costs (Currency Unit/km)
for different road conditions.


HDM-4 has incorporated sophisticated vehicle operating cost relations hips and road deterioration
algorithms which are us ed to estimate future vehicle costs for various road conditions.


Travel Time Costs
HDM-4 mak es provision for the following t wo types of travel time costs:


   Passenger Time Costs; and
   Cargo Delay Costs.


By specifying unit costs for the above two travel time costs, the estimated time costs f or various
road projects are incorporat ed into the economic evaluation.


Furthermore, the user can specify what percentage of time a vehicle is used for private and
working purposes.


Accident Costs
HDM-4 does not model accident reductions by various road improvements. These have to be
modelled externally. However, the user can specify accident rates (accidents per million vehicle -
kilometre) for various roads, and by specifying accident costs per accident type (fatal, injury and
damage to vehicle only) the accident cost savings are incorporated in the economic analysis.


Environmental Aspects
HDM-4 includes social and environmental effects (SEE) models which are used to analyse


   Energy balance; and


                                                                                      Page      15
   Vehicle emissions.


E valuation of other aspects of environmental impacts that arise from road transport (e. g. noise
pollution, damage to crops etc.) will be included in lat er versions of HDM -4.


The assessment of energy implications (energy balance analysis) of road investment projects
considers the following:


   energy used by motorised vehicles (i.e. energy us ed to produce and energy used to operate
    the vehicle);
   energy used by non-motorised vehicles;
   energy used during the construction and maintenance of road networks.


HDM-4 predicts different components of vehicle exhaust emissions as a function of fuel
consumption. Fuel consumption is a function of vehicle speed that in turn depends on road and
vehicle characteristics.


The different components of vehicle emissions modelled are:


   Hydrocarbon;
   Carbon monoxide;
   Nitrous monoxide;
   Sulphur dioxide;
   Carbon dioxide;
   Particulates;
   Lead.


In the current version of HDM-4, only the net differences in the quantities of pollut ants are
assessed for each investment option but thes e are not costed for inclusion in the economi c
analysis. It is also envisaged that t he model will be extended to include impacts on air quality,
health and global warming.


Conclusion
The HDM -4 model incorporates sophisticated VOC relationships and pavement deterioration
algorithms which are updated from the previous models as contained in the extensively used
HDM-III software programme. HDM -4 enables the user to evaluate various road maintenance and
road construction/improvement activities in terms of total lifecycle costs (i.e. not only in terms o f
road agency costs but also in terms of road user costs). Future versions of HDM -4 will also
incorporate environmental aspects into the economic analysis of road projects.




                                                                                      Page         16
3.7.5   Austroads Model
Introduction
Austroads is the national association of road transport and traffic authorities (RTTAs) in
Australasia. The A ustroads (1996) Benefit Cost Analysis Manual provides guidelines for
performing benefit cost analysis to assist road transport and traffic authorities (RTTAs) to assess
and initially prioritise road infrastructure projects on the basis of quantifiable monet ary benefits to
the community and RTTA costs.


Benefit Cost Analysis (BCA) is used as technique for assessing the economic efficiency of
resource allocation. The BCA Manual is the 1994/95 out put from A US TROADS project RSM
3.A.28 of the Road System Management Program. That program's overall aim is to promote
efficient management of the Australasian road systems and to facilitate their adequacy,
performance and contribution to the national economies.


Key parameters
Benefit Cost Ratio
The B enefit Cost Ratio (B CR) is the preferred decision criteria for road investment projects across
the RTTA program of works as it can provide a ready indication of relative project performance.


Discount rat es
The discount rate is the inflation free rate of 7%, and is used to convert current dollar values of
RTTA or community costs, which occur in a future year, to pres ent values.


Vehicle Operating Costs
Austroads includes fuel, s ervice and repair costs as the costs of operating vehicles. To the extent
that driving on different road types leads to different resale values of vehicles and sometimes to
different prices for the goods being carried, vehicle operators also pay for depreciation and
deterioration.


The free speed is also estimated using input of vehicle type, roughness, model road state and
general terrain, including horizontal and vertical alignment.


Various AUS TROADS projects are currently reviewing the values used for estimating vehicle
operating costs. The values used are in resource cost terms.


Travel Time costs
The value of travel time savings for various classes of road users are a key input to the economic
evaluations of roads projects and programs in the model us ed by Austroads. On roads with large
traffic volumes, delays to traffic during road maintenance or rehabilitation are included as a us er
cost when comparing strategies.



                                                                                        Page         17
Accident costs
Austroads do inc orporate traffic safety into their respective impact assessments. Accidents are
defined as involving costs to the community in terms of police, medical and legal expense, damage
to property, lost income and personal trauma.


Environmental Aspects
Cost-benefit analysis is used to value the community benefits of reduction in traffic noise, although
it is stated that it may prove difficult as there is no universally accepted method of valuing noise
disturbance.


A further complication identified is the principle adopted to do quantification, e.g. s hould the value
of noise disturbance reflect the amount individuals are willing to accept to tolerate noise, or t he
amount they are willing to pay to have the noise reduced.


According to Austroads, the ”willingness to accept” measure yields a higher value of noise
reduction than ”willingness to pay”. One method identified is the Hedonic Price Technique, which
takes differences in house prices as a measure of people's willingness to pay for peace and quiet.


Conclusion
Austroads uses the Benefit Cost Ratio (BCR) as the preferred decision criteri on for road
investment projects. Austroads defines the major elements of community costs for road projects
as vehicle operation, travel time and accidents. It is noted that AUSTROA DS uses the same
approach as WERD and COBA10 to estimate vehicle operating costs.


Conclusions on Comparative Analysis:
A comparison of the value sets recommended for travel time, accident cost and discount rat e, by
DKM, COBA and WERD in Ireland is given in the table below.




                                                                                       Page         18
Table 9: Summary comparison of CBA parameters
                        Description                               DKM            COBA            WERD        AUSTROADS

                                                                  1994       1994 (Euro)**     1995 (Euro)
                                                                 (Euro)*
Value of Time (Euro/hour)
Working Car                 Passenger                              7.1             8.5            10.3          n/a
Non-w orking Car Passenger                                         2.8             2.5             3.2          n/a
Values for accidents and casualties (Euro / incident)
Fatal
Serious                                                          585 000        623 822          942 000        n/a
Slight                                                            19 500         71 111          111 000        n/a
                                                                   1 170          5 506           8 600         n/a
Vehicle Operating Costs (Euro / km)
HGV                                                                   0.16          ***          0.35****       n/a
LGV                                                                   0.08          ***          0.22****       n/a
Discount Rate                                                          5%           5%            4.24%         7%
Note:      * Currency Exchange Rate 1994/1995: Irish Punt 1 = Euro 0.78 (Source: http://www.oanda.com
           FX History)
        ** Currency Exchange Rate 1994/1995: GBP1 = Irish Punt 1.02, and Irish Punt 1 = Euro 0.78
           (Source: http://www.oanda.com FX History)
       *** Depends on road condition, vehic le operating cost inputs etc.
      **** Vehicle Operating Cost (VOC) per km were derived from VOC per hour of Euro 17.59 and
             Euro 27.68 for LGV and HGV respectiv ely by assuming an average vehicle speed of 80 km per
             hour.
      n/a = not available




The value of non-working time used by DKM, COBA and WERD is relatively similar, but the value
of working time differs. It was also noted from the WERD 2000 document that the value of working
time used in Ireland is less than the average value of working time used by the Member States.


The value of fatal accidents stated by WERD is higher than DKM and COBA.


However, the value reflected by DKM and COBA is quite similar to the average value of Member
States.    It is noted that the value of serious and slight accidents determined by DKM is
substantially lower than the value determined by COBA and WERD. This needs to be investigated.


The values used for t he similar parameters in the World Bank model and the Austroads approach
are not given in this table, as their values are quite different in approach and application.


It can however be concluded that these models have in general a similar approach to the COBA
model us ed in Ireland in terms of overall methodology, model elements and parameters.




                                                                                                     Page       19
4.       Conclusions and Recommendations

The purpose of this report was to assess and review the project appraisal model used by the
National Roads Authority (NRA) and the paramet er values currently used in the model.


The following conclusions can be made:


    in general, the model used by the NRA (COBA 10) is sound in t erms of approach. The
     methodology is also similar t o that used by other road authorities in the EU and other parts of
     the world;
    the elements used in the model to quantify costs and benefits are also conventional;
    the discount rate of 5% is realistic, as stated by DKM, COBA, MCAS and as rec ommended by
     the Department of Finance in Ireland;
    the time value parameters are based on values determined in 1994. Costs and benefits are
     currently discount ed back to 1994 for analysis purposes. This approach may sometimes lead
     to distortions in quantifying values due to issues regarding interest rates and ot her factors.
     Also, it appears that the impact of either speed or road characteristics on VOCs are not
     included in the parameter values. That can modify fuel consumption and subsequently costs;
    the comparative analysis indicated that there are differences in some parameter values
     between those values proposed for by the WERD and the NRA;
    the 1994 study also considered environmental impacts, and concluded that these are
     complicated to quantify. The NDP/CSF E valuation Unit proposed that only externalities
     quantified on a reliable basis should be considered. There are, however, several studies
     ongoing at the moment to investigate environmental impacts of roads and the transport sector.


Based on these conclusions, the following recom mendations are made:


    the COBA 10 model should continue to be the basic model for analysis, and should be
     updated to COBA 11 once the latter is used more widely in the region;
    the key parameter values that were determined in 1994 should be updated to 2002 values,
     and the basis year for future CBA analyses taken as 2002. This includes an updat e of t he
     value of working time, since it seems that the approaches followed to determine the value
     differs;
    the value of serious and slight accidents needs to be inves tigated further and updat ed;
    the approaches followed to determine VOC also need to be investigated further and updated,
     to ensure consistency;
    once the results from studies to investigate the environmental impacts of road projects are
     completed, their findings should be incorporated into the methodology for cost -benefit analysis
     of these projects.



                                                                                       Page       20
Annex 2           National Primary Roads Project Case Studies

1.       Discussion

Five national primary roads projects were selected as case studies for detailed review and
evaluation of physical and financial project progress. The purpose of t he case studies was to “drill-
down” into the project det ail to validate information received on progress and constraints, and to
identify issues that may be less readily available from existing sources and consultations. The
projects were selected to cover a range of contract structures (Design - Build, PPP, Open
Procedure, Restricted Procedure), funding structures (Exchequer, ERDF co -funding, cohesion
fund co-funding, PPP), extent of completion and geographical location. The deliverables of this
exercise were the following:
    Physical project progress. Evaluat e physical progress in terms of the project cycle and key
     milestones, comparing the original project programme wit h actual progress to date per phase;
    Financial progress. E valuate progress in financial t erms, comparing the initial estimated total
     cost and revised estimates during the various project phases with actual expenditure to date or
     final outturn cost (as applicable);
    Constraints and measures. Identify constraints/measures that do or may hinder/expedite
     programme delivery. Identify constraints/measures that impact on project cost per phase,
     whet her the effect is to increase or dec rease total project cost;
    Project management procedures. Review project management procedures and systems
     implemented by the NRA, specifically the National Roads Project Management Guidelines
     implemented at strategic level and ot her procedures that may be in place at execution level
     (for example site management systems).


Due regard must be given to international best practice when performing the review and
evaluation.




                                                                                      Page           1
2.       APPROACH

A three-step approach was followed for each case study as follows:
    Step 1 -    review all available project information and applicable documentation provided by
     the NRA, summarise project background and general proc edural aspects and identify initial
     problem areas and constraints.
    Step 2 -    interview the NRA Inspectors using a structured questionnaire to obtain additional
     information and perform a site investigation.
    Step 3 -    synthesise the information to identify constraints.


Information collected was divided into a number of categories, including procedural (strategic and
tactical), programme, financial and funding, c ontract documentation, engineering design and
institutional.




                                                                                    Page         2
3.                Case Study Results

3.1               NENAGH/LIMERICK


3.1.1             General Information
                                                                                      N7 NENAGH – LIMERICK



                                                                          2
                                                                                           Rout e:              N7 Nenagh to Limerick

                                                                        N5
                                                    Nenagh                            N7




                                                                                           Length of Project:   38km
              Co. Clare                     N7




                                                                                           Proposed Standard:   Motorway
                                                     Co. Tipperary NR

       Limerick
N 18
                          N7
                                                                                                      Proposed route corridor
         9
       N6                            Co. Limerick                  Co. Tipperary SR
          0
        N2




                               N2
                                 4




This project entails the construction of 28 km of national primary road N7 bet ween Limerick and
the Nenagh bypass to a 4-lane divided Motorway standard, and upgrading the 10km Nenagh
bypass to a 4-lane divided Dual Carriageway. The southern 28 km section will be a new road
running virtually parallel to the existing N7, tying into the Limerick Southern Ring Road (P hase 1),
which is scheduled for completion during early 2004, at the Newport Interchange. The nort hern 10
km section of the project entails upgrading t he existing Nenagh Bypass, which was constructed to
a 2-lane standard during 2000, to a 4-lane divided Dual-Carriageway standard. The new road
section will tie in with the Nenagh Bypass at the modified C arrigatogher interchange.


The existing section of the N7 south of the Nenagh Bypass currently carries in the order of 16000
vehicles per day and upgrading is essential for capacity reasons.


The decision to upgrade the Nenagh Bypass shortly after completion, although contentious and
not presently warranted by traffic demand, was made to achieve the Government (NDP) policy
objective of linking Limerick and Dublin via Motorway/High Quality Dual Carriageway with a
consistent design standard and cross-section.


Being a PPP project, the road will be tolled, and to meet the legal requirement of providing an
alternative route the existing N7 will be retained for this purpose.


Programme and Activities
General
The overall project programme is summarised in Table 3.1.1 and present ed graphically on Figure
3.1.1 below. Three programmes are shown, namely, the original strategic programme developed
by the NRA/ County Council (Blue progress bar shown as “Planned”), the revised programme


                                                                                                                                  Page   3
developed by the consultants after appointment (Yellow progress bar shown as “Revised”) and the
actual recorded progress (Red progress bar shown as “Actual”).


   Table 3.1.1: Project dates
  Phase            Phase start date                          Phase end date                       Phase period
           Plan       Revised       Actual           Plan       Revised     Actual         Plan    Revised       Actual
   1       06/99          -           -              06/00         -           -           12 M       -             -
   2       01/00       09/00        09/00            12/00       04/01       07/01         12 M      8M           11 M
   3       06/00       01/01        02/01            07/01       08/01       11/01         13 M      8M           10 M
   4       03/01       03/01        12/01            03/02       01/02      current        12 M     11 M         current
   5       06/01          -           -              12/02         -           -           19 M       -             -
   6       01/03          -           -              12/05         -           -           36 M       -             -



The project is currently in the early stages of Phase 4.


Figure 3.1.1:      Project Programme

            OVERALL PROJECT PROGRAMME FOR N7 (LIMERICK - NENAGH)
                                          << 2000     2000      2001        2002    2003      2004      2005     2006      2006 >>
                                Planned
 1. Overall Project
                                Revised
 Planning                       Actual
                                Planned
 2. Constraints Study           Revised
                                Actual
                                Planned
 3. Route Selection             Revised
                                Actual
                                Planned
 4. Prelim. Design/
                                Revised
 Land Acq. Proc.                Actual
                                Planned
 5. Constr. Doc. Prep./
                                Revised
 Tender/Award                   Actual
                                Planned
 6. Scheme
                                Revised
 Construction                   Actual
                                Planned
 7. Final Account/
                                Revised
 Closeout                       Actual


                   Initial NRA Planned              Revised (Consultants)              Actual to date              Not Finished




Phase 1 – Overall Planning
The initial intention was that the design for the road upgrading bet ween the Newport and
Carrigatogher interchanges would be done in-house by the Kilkenny County Council to a Reduced
Dual Carriageway standard. The design process was initiated during 1999 with t he preparation of
an initial Constraints Report, followed by a Public Cons ultation. However, following the NDP/NRA
directive during 2000 that the road would be constructed via PPP to Motorway standard, the
Limerick County Council requested submissions from consulting firms for engineering cons ulting
services   during       early      2000.     The      submissions           were   evaluated      and    the     successful
MCOS/Scetauroute Joint Venture was appointed on 23 May 2000. A project inception meeting was
held during Sept ember 2000.



                                                                                                          Page              4
The change in approach from in-house County design and supervision with Open Procurement to
the PPP procurement process may be seen as an initial delay to project implementation in terms of
the overall programme as some abortive work was performed. This delay is a function of
integration of the overall NRA/County Council planning and project identificati on processes.
However, subsequent to having appointed consult ants, no delay was experienced during Phase 1.


Phase 2 – Constraints Study
Planned phase period:            September 2000 to April 2001 (8 months)
Actual phase period:             September 2000 to July 2001 (11 Months)


On appointment the consulting team developed a project programme for phases 2 to 4. This
programme will be used as the benchmark to evaluate project progress, as progress on Phase 1
was interrupted due to a change in the project implementing approac h. The Constraints Study
                       3
identified a 500,000 m shortage of road-building material and various environmentally sensitive
areas, including bogs, dairy farming land, arc heologically sensitive areas (old silver mine) and
forests. The first Public Consultation and public display was held during February 2001. Limited
feedback was given, attendance was in the order of 500 people and public concern was expressed
regarding the impact on the community.


Although the planned and actual phase c ompletion dates point to a 3-mont h delay, no delays to
the overall process were ex perienced during this phas e as the actual overlap between P hases 2
and 3 was longer than initially envisaged, facilitating earlier commencement of Phase 3.


Phase 3 – Route Selection
Planned phase period:            January 2001 to August 2001 (8 months)
Actual phase period:             February 2001 to November 2001 (10 Months)


Rout e Selection commenced in February 2001. Substantial interest in the project was shown
during the second Public Consultation held in February 2001. Various route options were
displayed and the following public concerns were raised:
   Noise levels at Limerick. Additional studies were commissioned to investigate this in detail.
   Impact on dairy farming, specifically in the Ballywilliam area. Alignments were modified to
    address this.
   Peat bogs, specifically Drominboy Bog, which has educational interest. Alignments were
    modified to address this.
   The physical route selection and criteria applied.


The public made in the order of 1500 submissions, not all of which could be or were addressed,
and action groups were formed. An additional Public Consultation was held during November 2001



                                                                                      Page          5
immediat ely after publication of the selected route corridor for display purposes and to invite
additional comment.      P ublic comment generated by this display was addressed during t he
following phase. Further aspects potentially impacting on programme included the foot -and-mouth
outbreak, preventing access to land, and the IFA dispute.         A High Court action was brought
against the County by one landowner resulting in a judiciary review.


Ultimately, the attention to detail during this phase exceeded that envisaged in the NRA guidelines.
Various activities normally performed during Phase 4 were brought forward to inform the process
to facilitate closure on route selection.


The route corridor was approved during November 2001. This resulted in an overall three-month
delay relative to the revised programme, and was caus ed through no fault in the process followed
or level of detail of the work, but due to alignment revisions and the extensive public consultation.
An argument could be made that attention to detail during this phase will have the effect of
rendering a higher level of confidenc e in work done, thereby reducing opposition during the CPO
process and accelerating phases 4 and 5 of the programme. These potential benefits should be
monitored.


Phase 4 – Preliminary Design / Land Process
Planned phase period:              March 2001 to January 2002 (11 Months)
Actual phase period:               December 2001, in proce ss


This phas e commenced during December 2001. The following activities have been complet ed to
date:
   In the order of 120 of the 200 affected land owners have been visited.
   The EIS was initiated during March 2002.
   Geotechnical surveys commenced during April 2002.
   Nearly all of the affected landowners have been visited or contacted
   Development of land take and drainage plans commenced recently


Plans indic ating land take will be left on display for public scrutiny. The toll strategy and relat ed
CPO will be complet ed during this phase.


The current revised milestone for CP O is October 2002, 9 months behind revised schedule.
Various aspects may further impact on the delivery of this phase. Of primary concern is the opinion
of the County Council that the deliverables for P hase 4, specifically concerning design drawings,
have not been adequately defined. This must be monit ored in the light of questionable integration
within the consulting Joint Vent ure. Drawings should be provided in V ector format t o facilitate
future use.




                                                                                       Page          6
In defence of current progress, the revised programme only allocated 16 months for phases 2, 3
and 4 s howing a substantial 6-month overlap bet ween phas es 3 and 4. It is questionable whether
this is a realistic programme, considering the onerous CPO proc ess.


Phases 5 to 7
Planned phase period:                        To be established


The project will proc eed as a PPP after t he completion of P hase 4. However, substantial
consultant/NRA involvement is necessary before appointment of the PPP and associated contract
agreements are finalised, and the following activities must be performed:
       Initiation of a pre-qualification process and selection of pre -qualified tenderers
       Management of the tender process, including drafting of tender documents, tender supervision
        and tender evaluation
       Drafting of the final concession document.


Once appointed, the successful tenderer will develop a programme for delivery of fut ure phases.
The initial overall programme indicates project completion by the end of 2005, in line with NDP
objectives. However, considering current progress, reasonable time frames include an 18 `-month
period after CPO to finalise the appointment of a consortium (to April 2004) and a 28 -month
construction period, ending around August 2006.


Of concern to delivery are the following:
       It is unlikely that delays experienced to date will be mitigated through acceleration.
       It is likely that the consortium will comprise new consultants, breaking continuity.
       Construction of the Newport interchange and associated linkage roads is problematic.
                                                               3
       The Constraints Study identified a 500,000 m short age of road-building material.
       A large viaduct must be constructed at the midpoint of the project. This wi ll have an impact on
        continuity of earthworks and transport of materials across the site.


These items will have to be closely evaluat ed and monitored during this phase.
Financial Progress
This PPP project was earmarked for ERDF co-funding.                         The initial total project cost estimate,
revis ed estimate and actual expenditure to date per phase are summarised in Table 3.1.2 below.


    Table 3.1.2: Actual vs. Planned Expenditure
    Phase           Initial cost estim ate             Revised cost estim ate             Actual cost /
                        (1996 values)                      (2001 values)                  Cost to date
    1           €                            -     €                            -    €                   24,425
    2           €                     605,856      €                   1,180,165     €                  836,638
    3           €                   1,211,711      €                   2,360,330     €                2,075,062
    4           €                   2,423,422      €                   4,720,659            Current
    5           €                   7,876,122      €                  15,342,142
    6           €                  96,936,886      €                 188,826,362
    7           €                  12,117,111      €                  23,603,295



                                                                                                      Page        7
   Total     €              121,171,107   €             236,032,952          €        2,936,125



The cost estimates include VA T but exclude allowance for escalation (PVC) and contingencies
(claims and variations).


The initial cost estimate was obtaine d from the National Road Needs Study (NRNS, 1998), which
was calculated using 1996 unit cost rates for road schemes. It was divided into the different
phases using a standard percentage allocation as provided by the NRA. This value corresponds
to an amount of €166,292,833 (incl. VAT) in 2001 if inflation is accounted for.


The revised (consultant’s) estimate for the final design and construction is €218.3m (2001 prices,
incl. VAT), and is expected to be more accurate as it is based on estimated quantities and
associated unit rates.     This estimate was extrapolated to include the total project costs, again
using the standard phase breakdown estimate provided by t he NRA, thus the revised t otal project
cost estimate of € 236,032, 952 (2001 prices, incl. VAT).


The consultants’ revised estimate for the project exceeds the initial cost estimate by some 95%
(42% if inflation is accounted for). The initial estimate was based on the construction of a Reduced
Dual Carriageway/Wide 2-Lane road, and the project scope has since then changed to the
construction of a Motorway/High Quality Dual Carriageway, as described under section 3.1.2(b) of
this report. A more accurate initial estimate for the project cost would have been in the region of
€178m (1996 prices, incl. VAT), given the new scope of the project. This value was calculated,
using the NRNS unit pric es, for constructing the new 28km Motorway section, and upgrading of the
10km Nenagh bypass. This value corresponds to about €244m in 2001 (incl. VAT) if inflation is
accounted for. The revised estimate is within 6% of this adjusted initial estimate.


As stated above, the revised estimate amounts to 195% of the initial estimate, with inflation
accounting for 37% of the difference, the scope change to 64% of the difference and the remaining
6% is the preliminary estimate error.


The actual cost for Phas es 1, 2 and 3 exceed the initial cost estimate by 62% (18% if inflation is
accounted for), but is well within the budget of the revised cos t estimate despite the protracted
Public Consultation process.        The project outturn cost will invariably be higher than t he
initial/revised estimates, because these do not make allowance for escalation/inflation (whic h the
contractor is fully entitled to through the PVC) and additional work due to scope changes or other
contingencies. Cost savings may, however, be achieved through efficiencies within the PPP.




                                                                                      Page         8
Project Management, Procedures and Institutional Arrangements
The NRA Project Management Guidelin es were published in March 2000 and were adopt ed for
project management of this scheme from this date onward. A brief summary on compliance with
procedures is given below:
     Questionnaires were completed.
     The PM series of project management forms was completed at the beginning of each phase.
      However, the required monthly submission of PM forms was substituted with the minutes of
      the monthly progress meetings. The minutes are used as the primary method of tracking
      project progress.
     The Constraints Report and Route Selection Report were submitted and included t he required
      detail.
     Public Consultations were held at the suggested intervals using the suggested approac h.


Steering committee meetings are generally held at 5 to 6 -weekly intervals while working meetings
are held at weekly to 2-weekly intervals. According to the County Council, staffing is adequate for
supervision responsibilities during all phas es besides Public Consultation phases .


The     following   suggestions   are made regarding          project   management   and institutional
arrangements:
     Project progress should be monitored in terms of activities and milestones on a monthly basis
      to ensure the timely identification of any anomalies.
     Temporary staffing should be assigned to the project during the Public Consultatio n
      processes.




                                                                                       Page         9
       Summary, Conclusions and Recommendations
                                              N7 NENAGH-LIMERICK
                                              PROJECT PROGRAMME
Start date:                            June 1999
Construction Start date:               Expected January 2003
Construction End date:                 Expected December 2005
Current status:                        Phase 4 (Preliminary design)
   The project is currently still in the preliminary planning phases, and is around 9 months behind schedule.
    This can be attributed to several factors, including an unusually long Public Consult ation process.
   The revised programme for this project only allowed for 16 months to complete phases 2 to 4, which may
    be seen as inadequate, especially given t he onerous nature of the CPO process. The extent of CPO and
    environmental studies should be c onsidered in more detail during the planning stage in order that budget
    and time allocations are more accurate.
                                               FINANCI AL DETAILS
                                Prelim. phas es &                            Design &
Cost Description       Date                               Land*                                      Total*
                                  Management*                             Construction*
Initial estimate:      1996          €4,240,989          €4,846,844        €112,083,274            €121, 171,107
Revised estimate:      2001          €8,261,153          €9,441,318        €218,330,481            €236,032,952
Actual to date:          -           €2,936,125                    -                    -            €2,936,125
*All values include VA T at 12.5%
Procurement & Funding:           PPP Project (tolled). (ERDF Co-funding initially)
   The revised cost estimate for the project is 95% higher than the initial estimate. Scope changes made
    after project inception accounts for 64% of the difference, and normal cost inflation/escalation for a further
    37%. The initial estimate therefore overestimated the total project cost (tak en t o be the revised estimate
    at present) by 6%, if the above-mentioned scope changes and inflation are taken into account.
   The actual costs to date are well within the revised project cost estimate.
   The initial and revised estimates for scheme co nstruction do not make allowance for escalation/inflation
    and contingencies. The project outturn cost will therefore invariably be higher than the initial and revised
    estimates due to inflation (through the Pric e Variation Clause). A procedure to deal wit h cost increases in
    the budgeting process should be developed and implemented by the NRA.
                                          PROJECT MANAGEMENT
   It appears that the Project Management procedures followed on this project are adequat e.
   The change in scope after the start of the project resulted in some initial delays. The National Road
    planning and project identification proc esses should be optimised to prevent abortive work, usually
    resulting in delays and cost over-runs.
   As mentioned above, the revised programme allowed for a very s hort time to complete phases 2 to 4.
    Project programming must be accurate and milestones should be achievable. Tracking of progress on
    activities and milestones should furthermore be done on a monthly basis to identify anomalies.
   Referenc e should be made in the NRA Project Management Guidelines to procurement and other
    procedures to be followed for PPP contracts.




                                                                                              Page            10
3.2     KNOCK/CLAREMORRIS - PHASE 2


General Information
                                                     PROJECT DETAILS

                                              N1
                                                 7                           N17 Claremorris to Knock
                                                        Rout e:
                            Knock                                            (Phase 2)

                                                        Length of Project:   11km
                     N1 7




                             Co. Mayo
                                                        Proposed Standard:   2-lane single carriageway
        N6
          0




                     Claremorris                                  Phase 2 (Under Construction)
                                        N60
                                                                  Phase 1 (Completed)
              N1
                 7




This project entails the construction of approximately 11 km of new national primary road N17
between Knock and Claremorris to a 2 -lane national road standard (revised national standard with
total paved width of 13.5m, 7. 5m carriageway width and 3.0m shoulders). The southern limit ties in
with the recently completed 6 km Phase 1 section which extends to Claremorris. Phase 1 was
constructed to the same design standard and took 3 years to complete. The nort hern limit links
with the existing N17. The new road runs virtually parallel to the existing N17, which will be
retained as a Regional road.


This project is the fourth NRA Design – Build scheme to be implement ed and is, in essence, a pilot
project, selected to monitor, evaluate and review the Design – Build process used in Ireland, which
is based on the Scottish model.


Programme
General
The overall project programme from phase 5 onward is summarised in Table 3. 2.1 and present ed
graphically on Figure 3.1.1 below. Three programmes are shown, namely, the original strategic
programme developed by the NRA/ County Council (Blue progress bar shown as “Planned”), the
revis ed programme developed by the consultants after appointment (Yellow progress bar s hown
as “Revised”) and the actual recorded progress (Red progress bar shown as “Actual”).


The project is currently in Phase 6.




                                                                                                 Page    11
  Table 3.2.1: Project dates
  Phase            Phase start date                     Phase end date                    Phase period
           Plan       Revise      Actual        Plan       Revise     Actual      Plan     Revise      Actual
  1          -           -          -             -          -           -          -         -           -
  2          -           -          -             -          -           -          -         -           -
  3          -           -          -             -          -           -          -         -           -
  4          -           -          -             -          -           -          -         -           -
  5        07/99         -        07/99         02/01        -         02/01      20 M        -         20 M
  6        01/01      04/01       04/01         12/02      01/02      current     24 M      19 M       current
  7        10/02         -          -           04/03        -           -         7M         -           -



Figure 3.2.1: Project Programme


          OVERALL PROJECT PROGRAMME FOR N17 (KNOCK - CLAREMORRIS)
                                      << 2000      2000      2001        2002   2003     2004       2005   2006     2006 >>
                            Planned
 1. Overall Project
                            Revised
 Planning                   Actual
                            Planned
 2. Constraints Study       Revised
                            Actual
                            Planned
 3. Route Selection         Revised
                            Actual
                            Planned
 4. Prelim. Design/
                            Revised
 Land Acq. Proc.            Actual
                            Planned
 5. Constr. Doc. Prep./
                            Revised
 Tender/Award               Actual
                            Planned
 6. Scheme
                            Revised
 Construction               Actual
                            Planned
 7. Final Account/
                            Revised
 Closeout                   Actual


                Initial NRA Planned              Revised (Consultants)             Actual to date            Not Finished




The project appears to be well on time.


Phases 1 to 4
The May o County Council identified and initiated the project during t he early 1990s and c omplet ed
the Constraints Study, first and sec ond P ublic Consultations, Route Location and P reliminary
Design in-house prior to 1995 without the assistance of consult ants. The CPO proc ess, including
fencing of t he road reserve, was completed by the end of 1995. It is not a statutory requirement to
perform an E IS for a scheme of this size and environmental issues were addressed at the CPO
oral hearings. The project was shelved during 1995 due to financing constraints




                                                                                                      Page          12
Phase 5 – Construction Documents / Tender Award
Planned phase period:             May 1999 to February 2001 (22 months)
Actual phase period:              May 1999 to February 2001 (22 months)


The project was re-activated during 1999 as part of the NDP process. The Mayo County Council
placed an advertisement for consultants during May 1999 and consultants were appointed during
December 1999 aft er evaluation of submissions. The consultants were tasked with evaluating the
Council design, which had originally been bas ed on the RT180 guidelines, against the newly
adopted DMRB standard and with updating the design accordingly.


This process resulted in a specimen design that would be used for tender purpos es.                The
specimen design showed that no additional land was required. Although the original planning
process for the scheme preceded the Part X Planning P rocess, a Part X planning process was
undertaken in order to take account of the design changes since the original CP O process. In
addition a statutory hearing was held in order to c onfirm t he closure of certain public roads arising
from design changes and the safety audit. Furthermore, it was identified that two climbing lanes
had to be constructed.


The NRA confirmed during January/February 2000 that the Design – B uild approach would be
applied. In view of the high cost to prospective t enderers for Design – Build schemes, it was
decided to do pre-qualification of the prospective contractors. The pre-qualification was announced
during April 2000 and was completed by June 2000. The 18 -week tender period commenced
during July 2000 with the s ubmission of tender documents, and tenders were received during
December 2000. The tender period was extended by 2 weeks to accommodate collection of
additional ground investigation information. Tender evaluation was completed during February
2001 and approval to award the contract was given on 23 February 2001.


This phase took 22 months to complete, of which 7 was taken up during the appointment of
consultants. This phase could have been shortened if a design review were not required. Strategic
road planning must be optimised to ensure that projects are not initiated to be shelved, resulting in
abortive work.


Phase 6 – Scheme Construction
Planned phase period:             April 2001 to November 2002 (20 months)
Actual phase period:              In process


The contract commenced during A pril 2001 (contract signed during May 2001). Substantial risk for
delay in delivery is transferred t o the cont ractor who carries a €31,750 penalty for each week that
project completion is delayed. However, the NRA does carry the risk for:
   Delays caused due to any Variation Orders issued by the NRA



                                                                                       Page         13
   Delay caused directly by the NRA, and
   Delays caused due to extraordinary adverse weather conditions.
   Price Variation due to inflation, calculated from an agreed formula


A number of Variation Orders ha ve been issued, including, inter alia, the tie -in with P hase 1, NDP
signs, field entrances, etc. It does not appear that the issued Variation Orders will impact on the
critical path.


Any intent to claim from t he cont ractor must be submitted to the NRA wit hin 30 days of the alleged
reason for the claim, in order for the NRA to anticipate any cost overruns and conduct the
necessary investigation int o the matter immediately. The contractor has claimed that the NRA was
the cause for delay in the following circumstances:
   The contractor had requested early access to site in order to complete earthworks prior to t he
    wet seas on. However, due diligence contractual checks and specifically verification of
    insurances (international contractor) extended the time period between appointment and
    access to site. The cont ractor has reserved the right to claim for late commencement of work.
   The contractor claims that he has been refused access to a quarry that was required for rock
    excavation. This process was subject to planning permission, and was effectively outside of
    the NRA’s responsibility. The contractor has reserved the right to claim for the associated
    delay.


A conciliator has been appointed for all Design – Build schemes, and the conciliation process will
be followed.


Various technical problems have arisen on site, including soft ground areas that had to be crossed.
The contractor elected to surcharge these areas, with varying degrees of success. One 80m
section which is under surcharge is still settling at 30mm pe r month. Surcharging as opposed to
more time-efficient methods (e.g. vibro-piling) has res ulted in a delay on earthworks.


This phase is up to 6 weeks behind schedule on certain activities, including earthworks. However,
the NRA’s risk is limited.


Financial Progress
This Design – B uild project is E RDF co-funded. The initial t otal project cost estimate, revised
estimate and actual expenditure to date per phase are summarised in Table 3.2.2 below. All
prices include VA T but exclude allowance for escalation (PVC) and c ontingencies (claims and
variations ).




                                                                                      Page        14
    Table 3.2.2: Actual vs. Planned Expenditure
    Phase            Initial cost estim ate        Revised cost estim ate            Actual cost /
                         (1996 values)                 (2000 values)                 Cost to date
    1            €                            -   €                        -     €                     -
    2            €                       97,769   €                        -     €                     -
    3            €                      195,539   €                        -     €                     -
    4            €                      391,079   €                4,314,824     €             4,085,036
    5            €                    1,271,007   €                3,662,227     €             1,347,084
    6            €                   15,643,173   €               22,167,196     €            13,900,000
    7            €                    1,955,396   €                2,770,899     €                     -
    Total        €                   19,553,967   €               32,915,147     €            19,332,121



The initial cost estimate was taken from the National Road Needs Study (1998), and is based on
kilometre unit rates, using 1996 prices, with a standard perc entage allocation to the various
phases.      The initial cost estimate of €19. 6m corresponds to €23.96m in 2000 if inflation is
accounted for.


The revised estimate for the project was taken as the total of the consultants’ tender estimate at
preliminary design phase and additional costs on the project.                  The pretender estimate was
€26,046,455 (200 prices, incl. VAT). This value was divi ded into phases 5 to 7 using t he standard
percentage breakdown provided by the NRA.


The revised cost estimate is 68% higher t han the initial estimate, of which inflation accounts for
22% and the preliminary estimate error for 46%.


The successful tenderer’s contract price for scheme c onstruction was €24, 069, 903 (8% lower than
the revised tender estimate). The contractor has included an amount of €634,869 in his contract
price for contingencies. At present, it seems likely that Variation Orders may total €444, 408, which
is well within this original allocation for contingencies. As discussed above, the contractor has
reserved the right to submit claims in the amount of €4.95m.


Factors that have resulted or may result in actual cost exceeding initial cost estimates include the
following:
   Initial costing for budget purposes is based on unit rates per kilomet re. The revised estimate
    is 46% higher than t he initial estimate if inflation is accounted for, and may therefore not have
    been sufficiently accurat e for this purpose.
   The contractor’s estimate for scheme construction does not make allowance for escalation. At
    present the final contract value seems likely to be 12% higher than the original tender amount
    due to escalation.
   Claims in the amount of €4.95 million may be submitted, as discussed above.
   Variation Orders in the amount of €444,408 may be issued, but this is covered by the
    contingency allowance in the contract up to the value of €634,869.




                                                                                               Page        15
Project Management, Procedures and Institutional Arrangements
The NRA Project Management Guidelines published in March 2000 were drafted for conventional
tender processes and scheme construction. As phases 1 to 4 were completed prior to public ation
of t hese guidelines and as phases 5 and 6 are implemented through a Design – Build process,
their direct application is not applicable. Nevertheless, the following project management
procedures are implemented:
   The PM series of project management forms and progress reports are completed on a monthly
    basis and submitted to the NRA electronically via the P RS.
   Progress is tracked via the Monthly Progress Reports tabled at the Monthly Client Meeting and
    at the Site meeting with the Contractor.        When the Contractor’s programme deviates
    significantly from his current Clause 14 programme, he is required to submit a revis ed
    programme under the cont ract.
   The contractor is ISO 9001 registered and the site quality assurance system is in place.
   External auditors are commissioned to audit the site quality assurance system.


It is suggested that project progress should be monitored in terms of activities and milestones on a
monthly basis to identify any anomalies.




                                                                                     Page        16
        Summary, Conclusions and Recommendations
                                     N17 KNOCK-CLAREMORRIS PHAS E 2
                                             PROJECT PROGRAMME
Start date:                             Early 1990s
Construction Start date:                April 2001
Construction End date:                  Expected April 2003
Current status:                         Phase 6 (Construction)
    The road is presently under construction, and the construction project is around 6 weeks behind schedule.
     This can largely be ascribed to difficult ground conditions.
                                               FINANCI AL DETAILS
                                    Prelim. phas es &
    Cost Description      Date                            Land*         Design-Build*             Total*
                                   Management*
Initial estimate:       1996               €684,389        €782,159         €18,087,419         €19,553,967
Revised estimate:       2000             €5,552,086      €1,316,606         €26,046,455         €32,915,147
Actual to date:            -                 €5,432,121                     €13,900,000         €19,332,121
Design-Build Tender Value:       €24,069,903 (2000)
*All values include VA T at 12.5%
Procurement & Funding:           Design-Build. ERDF Co-funding
 The revised cost estimate for the total project is 68% higher t han the initial estimate, of which inflation
     accounts for 22%. The initial estimate therefore under-estimated t he project cost by 46% (if inflation is
     accounted for). Initial costing for budget purposes is based on unit rates per kilometre only. Although t his
     may be accurate for programme level assessment, the method may not be sufficiently accurate for the
     purpose of individual project cost estimation.
    The actual project costs to date (including construction costs) are currently well wit hin the revised project
     cost estimate.
    The Design Build tender price was 8% less than the pre-t ender estimate. This would indicate that the DB
     process will be successful in limiting post-tender price increases for all those aspects where the risks have
     been trans ferred to the DB tenderer.
    The DB contract trans fers the risk for several aspects which leads to higher outturn costs on conventional
     projects to the contractor, thereby limiting the scope for cost overruns. The DB contract, however, still
     provides for increased payments to the contractor for price variations due to inflation. The actual outturn
     cost of the project will therefore most likely still be higher than the revised scheme cost estimate.
                                             PROJECT MANAGEMENT
    It appears that the Project Management procedures followed on this project is adequate.
    The shelving of the project from 1995 to 1999 res ulted in initial expens es on the project that could have
     been postponed by a number of years. Better planning could have avoided abortive costs.
    Project programming could be improved by the t racking of progress on activities and milestones on a
     monthly basis.
    The NRA Project Management Guidelines should be updated to incorporate procedures on Design – Build
     contracts.




                                                                                                Page         17
3.3                  KILCOCK/ENFIELD/KINNEGAD M4 MOTORSCHEME


General Information
                                                                            PROJECT DETAILS

     Co. Westmeath
                                                                            Rout e:              N4 Kilcock to Kinnegad
                                                Co. Meath

N4


                  Kinnegad                                                  Length of Project:   35km (+5km for operation)
     N6

                             N4
                                                   Enfield        Kilkock
                                                             N4
                                                                            Proposed Standard:   Motorway
                                                                       M
                                                                        4



     Co. Offaly
                                  Co. Kildare
                                                                                       Proposed route corridor



This project entails the construction o f 35 km of new national primary road N4 bet ween Kilcock and
Kinnegad to a 4-lane divided Motorway standard. An additional 4 km tie-in section of standard dual
carriageway will be constructed at the western end, to the east of Kinnegad, linking with the
existing N4 via two traffic circles immediately adjacent to each other. The eastern limit of t he
scheme ties in with the existing N4 Motorway via the new Kilcock interchange.


The project includes construction of a short 1 km tie-in section of the N6 immediately to t he south
of Kinnegad. The western limit of this section ties in with the existing N6 via a new interchange to
be constructed and a 500m link road.


The new M4 Motorway will run virtually parallel with the existing N4 which will be ret ained as a
County road.


Programme and Activities
General
The overall project programme is summarised in Table 3.3.1 and present ed graphically on Figure
3.3.1 below. Three programmes are shown, namely, the original strategic programme developed
by the NRA/ County Council (Blue progress bar shown as “Planned”), the revised programme
developed by the consultants after appointment (Yellow progress bar shown as “Revised”) and the
actual recorded progress (Red progress bar shown as “Actual”).




                                                                                                                   Page      18
   Table 3.3.1: Project dates
   Phase         Phase start date                 Phase end date                         Phase period
           Planned Revised Actual           Planned Revised Actual             Planned     Revised    Actual
   1          -          -          -          -         -          -              -          -          -
   2          -          -        05/99        -         -        01/00            -          -          -
   3          -          -        09/99        -         -        03/00            -          -          -
   4        01/00        -        03/00      09/01       -        11/01          21 M         -        21 M
   5        03/01     11/00       11/00      08/02     02/03     current         17 M       27 M      current
   6        07/02     03/03         -        12/05     03/05        -            42 M       24 M         -
   7        04/05     04/05         -        07/06     11/05        -             7M         7M          -



The project is currently in Phase 5.


Figure 3.3.1: Project Progre ss

           OVERALL PROJECT PROGRAMME FOR N4 (KILCOCK - KINNEGAD)
                                      << 2000     2000      2001        2002   2003      2004      2005   2006     2006 >>
                           Planned
 1. Overall Project
                           Revised
 Planning                  Actual
                           Planned
 2. Constraints Study      Revised
                           Actual
                           Planned
 3. Route Selection        Revised
                           Actual
                           Planned
 4. Prelim. Design/
                           Revised
 Land Acq. Proc.           Actual
                           Planned
 5. Constr. Doc. Prep./
                           Revised
 Tender/Award              Actual
                           Planned
 6. Scheme
                           Revised
 Construction              Actual
                           Planned
 7. Final Account/
                           Revised
 Closeout                  Actual


                Initial NRA Planned             Revised (Consultants)             Actual to date            Not Finished




Phase 1 – Overall Planning
The Kildare County Council identified and initiat ed the project during the lat e 1980s. A constraints
study and Route Location were completed bet ween 1989 and 1994. The project was shelved
during April 1994 due to financing constraints, and re -activated during 1998, with the allocation of
Euro 380,921 to Westmeath County Council, who collated all available information. The Council
advertised for consultants, and the successful West Consult Joint V enture (M.C. O’S ullivan in joint
venture with Roughan & O’Donovan) was appointed during May 1999. The consultant’s brief was
to design a portion of the scheme, the remainder being designed by the County.


The extent of abortive work caused by shelving t he project was mitigated by application of results
(e.g. the various route alignments) in following phases.




                                                                                                     Page          19
Phase 2 – Constraints Study
Planned phase period:            Ending January 2000
Actual phase period:             May 1999 to January 2000 (8 months)


The Constraints Study was performed jointly by the County and consulting team. Various
constraints were identified, including natural heritage areas. Based on letters written to about 1000
members of the public, 95% of local residents were in favour of the project, primarily due to heavy
traffic volumes on the N4. The first Public Cons ultation was held during September 1999. Five
alternative route alignments were presented. This presentation was met with limited resistance due
to public support for the scheme.


This phase was expedited by using preparatory work done prior to 1994 and due to the public
support for the scheme.


Phase 3 – Route Selection
Planned phase period:            Ending April 2000
Actual phase period:             Ending March 2000


Rout e Selection commenced in S eptember 1999. The preferred alignment was identified and
developed and the second Public Consultation was held at the end of February 2001. The selected
route option was display ed and the following issues were rais ed:
   Rat running through the rural road network in the vicinity of Kilcock. Two east -facing ramps
    were added on the N6 to address this.
   Severing of a church and graveyard. Link road alignments were modified to address this.
   Rare species of bat in the Broadford wooded areas. Alignments were modified to address this.
   Severance of mixed and stud farm land. Alignments were modi fied over a 3 km section to
    address this.
   Severance of Enfield and an adjacent village. A cross -road was provided to address this.


The alignment was subsequently finalised. Due to limited public resistance this phas e proceeded
without undue delay.


Phase 4 – Preliminary Design / Land Process
Planned phase period:            January 2000 to March 2001 (14 months)
Actual phase period:             March 2000 to November 2001 (18 months)


This phas e commenced during March 2000 and it was originally intended to go to Motorway O rder
(MO) by S eptember 2000. However, an NRA press release on 26 June 2000 indicated that t he
scheme would be assessed for possible PPP procurement. The MO was postponed to await the
toll study which would identify toll plaza locations, as well as the subm ission of PPP guidelines


                                                                                     Page         20
which t he NRA was in the process of drafting, and the initiation of the PPP process. The MO was
finalised on 28 February 2001 and the 5-week public display commenced on 5 March 2001. Oral
hearings took place at the end of July 2001. Bord Pleanála approval was given on 30 November
2001.


MO was delayed for clarity on the procurement process to be followed. Again, int egrated strategic
planning may have avoided this delay. Planning approvals are time-consuming and all efforts must
be made to improve liaison between Local Authorities and Bord Pleanála to expedite decisions.


Phase 5 – Construction Documents/Tender Award
Planned phase period:             March 2001 to September 2002
Actual phase period:              November 3000, in process


This scheme was earmarked as a PPP pilot project, and the NRA PPP consultants (KPMG/Babtie)
prepared various information documents which guided the prequalification and tender processes.
A pre-qualification procedure document was released in November 2000 and a generic brief for
consultants and County Councils was published in December 2000.


Following the approval of the scheme by the Bord Pleanála on 30 November 2001, the pre-
qualification process was initiated and pre-qualification submissions were rec eived during January
2001. A list of 4 pre-qualified tenderers was finalised during July 2001 and a 7 -month tender
process followed, ending in February 2002.


Three tec hnical meetings were held during the tender period during which design aspects we re
tabled and clarified.


Phase 6 – Scheme Construction
Planned phase period:             March 2003 to March 2005 (24 months)


It expected that the contract be awarded during August 2002. The successful tenderer will be
allowed a design period of 3 to 6 months, and it is envisaged that construction will commence
during March 2003, with a construction period of 24 months. The County will have some
involvement with construction supervision, but the extent of involvement has not yet been finalised.
The current consultant appointment will allow for independent monitoring of construction.


Technical aspects of interest that may impact on the scheme delivery are the following:
                           3
   Import of 1, 000, 000 m of road building material is required. It is deemed that sufficient private
    suppliers are loc ated on the route.
   The tie-in with the existing N4 to the west of Kinnegad is achieved via t wo roundabouts
    immediat ely adjacent to each other which could be problematic.



                                                                                       Page         21
Financial Progress
The initial total project cost estimate, revised estimate and actual expenditure to date per phase
are summarised in Table 3.3. 2 below. All prices include VA T but exclude allowance for escalation
(PVC) and contingencies (claims and variations).


    Table 3.3.2: Actual vs. Planned Expenditure
      Phase        Initial cost estim ate       Revised cost estim ate       Actual cost /
                       (1996 values)                (2001 values)            Cost to date
    1                     €         1,085,626         €        1,085,626      €        1,085,626
    2                     €           952,304         €          952,304      €          918,277
    3                     €           977,698         €          977,698      €          989,259
    4                     €         2,968,648         €        2,968,648      €        2,935,256
    5                     €       13,061,796          €      40,631,619       €        3,900,661
    6                     €      165,065,953          €     215,438,265       €                 -
    7                     €       19,046,072          €       26,627,201      €                 -
    Total                 €      203,158,096          €     288,681,361       €        9,829,079



The initial cost estimate was taken from the National Road Needs Study (1998), and is based on
kilometre unit rates, using 1996 prices, with a standard perc entage allocation to the various
phases. This corresponds to a value of €278.8m in 2001, if inflation is accounted for.


The revised (cons ultants’) estimate was taken from the preliminary design report, and is bas ed on
2001 prices. This figure is expected t o be more accurate as it is based on estimated quantities
and associated unit rates.     This report also gives an estimate for ot her activities in phase 5,
including a land acquisition cost estimate, which amounts to about €34.3m.


The revised estimate of €288.7m is 42% higher t han the initial estimate of €203. 1m, of which
inflation amounts to 37% and the estimation error 5%, which by virtue of a preliminary cost
estimate is acceptable.


The initial cost of t he project (before 1995) amounted t o €1,1m, as shown in the table for phase 1.
The consultants were appointed for Phases 2, 3 and 4 on a lump sum basis (lum p sum cost of
€802,474). A lump sum appointment for phases 5 and 6 will shortly be made, and it is expected to
be approximately €1.27m. Total actual costs for P hases 2, 3 and 4 are wit hin limits of the initial
and revis ed cost estimates.


The initial and revised estimates for scheme c onstruction do not make allowance for escalation
and c ontingencies. The contractor can rightfully claim for escalation through the PVC clause, and
the actual construction cost will therefore most likely be higher than the initial and revised
estimates. Cost savings may however be achieved through efficiencies within the PPP.




                                                                                       Page         22
Project Management, Procedures and Institutional Arrangements
The NRA Project Management Guidelines were published in March 2000. As phases 1 to 3 were
completed prior to publication of these guidelines and phases 4 and 5 are implemented via a PPP
process, their direct application is not applicable. Project management is controlled via the PM
series of project management forms. During 1999 and 2000 these forms were completed in hard
copy and returned to the NRA on a monthly basis. From 2001 the forms were submitted monthly in
electronic format.


Project management for the PPP process from Phase 5 onward will be in line wit h procedures
stipulated in the PPP document ation.


It is suggested that the NRA Project Management Guidelines be updated to either incorporate
procedures on PPP projects or to refer to applicable documentation.




                                                                                 Page        23
       Summary, Conclusions and Recommendations
                                            N4 KILKOCK-KINNEGAD
                                            PROJECT PROGRAMME
Start date:                          1989/1990
Construction Start date:             Expected March 2003
Construction End date:               Expected March 2005
Current status:                      Phase 4-5 (PPP Tender)
   The PPP tender process is nearing completion. The project progress is currently still on time acc ording to
    the revised project programme, and no problems in terms of progress is expected in the immediate future.
                                              FINANCI AL DETAILS
                                  Prelim. phas es &                             Design &
Cost Description       Date                                  Land*                                     Total*
                                   Management*                               Construction*
Initial estimate:      1996           €10,919,748           €8,126,324        €184,112,025           €203,158,096
Revised estimate:      2001           €12,332,966          €34,282,929        €242,065,466           €288,681,361
Actual to date:          -             €9,829,079                     -                    -           €9,829,079
*All values include VA T at 12.5%
Procurement & Funding:          PPP Project (tolled).
   The revis ed estimate is 42% higher than the initial estimate. Inflation accounts for 37% of the increase
    over the initial estimate. The initial estimate underestimated the project cost by 5% (after providing for
    inflation).
   The actual costs to date are still within both the initial and revised project cost estimates.
   The PPP tender price will not be directly comparable to the revised estimate due to the pricing nature of
    the tender.
                                           PROJECT MANAGEMENT
   It appears that the Project Management procedures followed on this project are adequat e.
   The Mot orway Order was delayed for clarity on the procurement proc ess to be followed. Integrated
    strategic planning may have avoided this delay. Planning approvals are time-consuming and all efforts
    must be made to improve liaison betwe en Local Authorities and Bord Pleanala to expedite decisions.
   The NRA Project Management Guidelines should be updated to eit her incorporate procedures on PPP
    projects or to refer to applicable document ation.




                                                                                                Page        24
3.4                LISSENHALL – BALBRIGGAN (PHASE 2)


General Information
                                                                     PROJECT DETAILS

                                     Balbriggan                      Rout e:               M1 Lissenhall to Balbriggan
                    M




Co. Meath
                     1




                                   Skerries
                                                                     Length of Project:    9.8km

                                         Rush
                              N1




            Co. Fingal                                               Proposed Standard:    Motorway


                                                                                Motorway under construction
                         N1




      Swords
                                          Malahide




This project entails the construction of approximately 10 km of new national primary road N1
between Lissenhall and Balbriggan to a 4-lane divided Motorway standard. The sout hern limit ties
in with the M1 Lissenhall-Airport section which is currently under construction to the same design
standard. The northern limit links with the existing M1 (Balbriggan bypass). The new road runs
virtually parallel t o the existing N1, which will be retained as a regional road. The project was
awarded by restricted tender. Traffic volumes along the route were in excess of 35,000 vehicles
per day (measured in 1999), necessitating the upgrading to Motorway standard.


Programme
General
The overall project programme for phase 5 onward is summarised in Table 3.4.1 and present ed
graphically on Figure 3.4. 1 below. Two programmes are shown, namely, t he original strategic
programme developed by the NRA/ County Council (Blue progress bar shown as “Planned”) and
the actual rec orded progress (Red progress bar shown as “Actual”).


 Table 3.4.1: Project dates
                                   Phase start date         Phase end date         Phase period
     Phase
                              Planned             Actual   Planned    Actual    Planned     Actual
 1                                   -              -         -          -         -           -
 2                                   -              -         -          -         -           -
 3                                   -              -         -          -         -           -
 4                                   -            07/93       -        07/95       -         24M
 5                                   -            04/98       -        04/01       -         36M
 6                                   -            07/01       -       current      -        current




                                                                                                              Page       25
Figure 3.4.1: Project Programme


     OVERALL PROJECT PROGRAMME FOR M1 (LISSENHALL - BALBRIGGAN)
                                   << 2000       2000   2001   2002      2003    2004   2005    2006     2006 >>
1. Overall Project       Planned
Planning                 Actual
                         Planned
2. Constraints Study
                         Actual
                         Planned
3. Route Selection
                         Actual
4. Prelim. Design/       Planned
Land Acq. Proc.          Actual
5. Constr. Doc. Prep./   Planned
Tender/Award             Actual
6. Scheme                Planned
Construction             Actual
7. Final Account/        Planned
Closeout                 Actual


                           Initial NRA Planned                  Actual to date                 Not Finished


The project is currently in Phase 6.


Phases 1 to 4
The Fingal County Council initiated the project during the early 1990s. The EIS was completed in
1995. The motorway scheme was not confirmed until 1998.


Phase 5 – Construction Documents / Tender Award
Actual phase period:                     Ending June 2001


The Fingal County Council performed all design in -house, besides structural design which was
performed by consultants. The tender was advertised during A ugust 2000, and tenders closed
during February 2001, wit h a week extension being grant ed. Six tenders were rec eived and tender
prices ranged between €40.7m and €60.9m. The construction cost estimate was €44.4m. The
contract was awarded to the lowest tenderer.


Phase 6 – Scheme Construction
Planned phase period:                    July 2001 to July 2003 (24 months)
Actual phase period:                     In process


The contract was signed on 26 June 2001, commenced during July 2001 and will run for a 24 -
month contract period. Approximat ely 30% of work has been completed, while the majority of
earthworks have been completed. Consequently, risk in terms of delays is limited.




                                                                                                    Page           26
Few technical problems have arisen on site. All soft ground areas have been crossed and all major
structures are above ground-level. Construction supervision is performed by Fingal County
Council. The structural design consultants are available for assistance relating to the structures.


It is expected that the contract will be complet ed within the allowed contract period.


Financial Progress
This project is cohesion co-funded. Co-funding is limited to the mainline construction works,
excluding structures, side roads and land ac quisition. The initial total project cost estimate, revised
estimate and actual expenditure to date per phase are summarised in Table 3.4.2 below. All
prices include VA T but exclude allowance for escalation (PVC) and c ontingencies (claims and
variations ).


 Table 3.3.4.2: Actual vs. Planned Expenditure
  Phase             Initial cost estim ate       Revised cost estim ate           Actual cost /
                        (1996 values)                (2001 values)                Cost to date
 1              €                            -   €                        -   €                     -
 2              €                            -   €                        -   €                     -
 3              €                            -   €                        -   €                     -
 4              €                            -   €                        -   €                     -
 5              €                            -   €                        -   €                     -
 6              €                   42,377,509   €              40,117,375    €            11,181,823
 7              €                    5,237,670   €                4,958,327   €                     -
 Total          €                   47,615,179   €              45,075,703    €            11,181,823



The initial cost estimate is based on t he project cost quoted in the National Road Needs Study
(NRNS, 1998), which was calculated using kilometre unit rates at 1996 prices. This NRNS figure
for the total project cost was then divided into phas es 1 t o 7 using a standard percentage
allocation provided by the NRA for schemes with higher land values (75% construction c osts, 25%
for planning, design, land, construction supervision, etc.). The initial total project cost estimate
was taken as the total of phases 6 and 7. This estimate therefore differs slightly from the total
project cost quoted in the NRNS, in that the unit price used in the NRNS included for costs on t he
first phas es of the project, whilst this work was done in-house by Fingal County Council.


The initial estimate of €47.6m (1996 prices, incl. VAT) corresponds to a value of €65.3m in 2001, if
inflation is accounted for. Given the current total length of the road and the unit prices used in t he
NRNS, this initial estimate should have been slightly less (€42.0m at 1996 prices, incl. VAT), which
corresponds to €57.6m in 2001 if inflation is accounted for.


The tender estimate done by Fingal County Council amounted to IR£35. 5m (€45,075,703) in 2001,
inclusive of VA T. This value was taken to be t he revised c ost estimate, again split up into phases
6 and 7 using the standard phase break down. The tendered amount was IR£32.1m (2001, incl.
VAT), or €40,771,005, which is 10% lower than the revised estimate (Fingal County Council tender
estimate).



                                                                                            Page        27
The revised estimate is 5% lower than the initial estimate. Inflation amounts to 37% of the initial
estimate, and the revised estimate is therefore 42% lower than the initial estimate if inflation is
accounted for. This can be attributed t o the fact that no interchanges and only four overbridges
will be constructed during this contract, and it is therefore a rather simple engineering project.


For the scheme construction, expenditure tracks progress closely and no anomalies were
identified. However, up to the monthly contract report no. 5, total claims in t he amount of €51m
have been submitted, including a claim of €48m for alleged delays arising from archaeological
investigation. While pre-contract archaeology surveys were performed, it is generally not possible
to identify all archaeological sites. Although t he contractor was instructed to c ease work on
archaeological sites as and when identified, it is expected t hat the critical path was not delayed
and that works could have proceeded elsewhere. The claim amount is based on the cost of a 2-
day delay per site of €63,487. The contractor has been paid an approved amount of €270,454 for
actual cost incurred. The claim is under investigation.       The estimated cost of archaeological
investigation is in the order of €1,5m.


In summary, factors that have resulted or may result in the actual cost exceeding initial cost
estimates include the following:
   The initial costing for budget purposes was based on unit rates per kilomet re and
    overestimated the cost of this project by 42%, which may not be suffici ently accurate for the
    purpose of an initial estimate.
   The revised estimate/tender price for scheme construction does not make allowance for
    escalation. Initial assessments of the PVC on this project shows that escalation may run at
    12% of total construction cost.
   Initial and revised estimates do not allow for contingencies and extra work.
   Claims in the amount of €50.8m have been submitted and are under investigation.


Project Management, Procedures and Institutional Arrangements
The NRA P roject Management Guidelines were published during Marc h 2000. As phases 1 t o 4
were completed prior to publication of these guidelines, their direct application is not applicable
during this period. The following project management procedures are implemented:
   Progress reports are submitted, indicating physical and financial progress on construction. The
    PM series of project management forms and progress reports are completed on a monthly
    basis and submitted to the NRA electronically via the P RS.
   Monthly site progress meetings are held and minutes are taken.
   It is not a requirement that the contractor be IS O registered. However, a site quality assurance
    system is in place and internal audits are performed.


It would appear that project management is adequate on this scheme.


                                                                                        Page         28
         Summary, Conclusions and Recommendations
                                           M1 LISSENHALL-BALBRIGGAN
                                              PROJECT PROGRAMME
Start date:                              Initiated early 1990s; Motorway confirmed 1998
Construction Start date:                 July 2001
Construction End date:                   Expected July 2003
Current Progress:                        Phase 6 (Construction)
     The project is currently under construction, and there are at present no major delays to the construction
      progress. It is expected that the contract will be complet ed within the allowed contract period.
                                                 FINANCI AL DETAILS
                                     Prelim. phas es &
    Cost Description        Date                          Land            Construction              Total
                                    Management
Initial estimate:       1996                    N/A              N/A         €47,615,179           €47,615,179
Revised estimate:       2001                    N/A              N/A         €45,075,703           €45,075,703
Actual to date:           -                     N/A              N/A         €11,181,823           €11,181,823
Construction tender value:       € 40,771,005 (2001)
*All values include VA T at 12.5%
Procurement & Funding:           Conventional Tender. Cohesion co-funding
 The revised estimate is 5% lower than the initial estimate, indic ating a total initial overestimation of t he
      project cost by 42% (if inflation is accounted for). In this case the initial cost estimate was too high because
      of the relative simplicity of the project compared to other mot orway projects in Ireland. Initial costing for
      budget purposes is based on unit rates per kilometre only and may therefore not be sufficiently accurate for
      this purpose.
     At present, the actual project expenditure corresponds closely to the planned expenditure, and no anomalies
      have been encountered.
     The initial and revised estimates for scheme construction do not make allowance for escalation/inflation and
      contingencies. The outturn cost will invariably be higher than the initial estimate/tender price, because the
      contractor is entitled to compensation for price variations, additional work and other s uch legitimate
      contingencies. For programme control and reporting purposes, formal provision should be m ade for price
      variations, additional work res ulting from scope changes and other legitimate contractual claims.      This will
      allow for better programme level cost control, and closer alignment bet ween expected and actual outturn
      costs of contracts.
                                              PROJECT MANAGEMENT
     It appears that the Project Management procedures followed on this project are adequat e.
     Whilst recognising the difficulty in assessing t he risk of the presence of archaeological sites in the propos ed
      road scheme, the importance of a proper archaeological survey was highlighted by this project.




                                                                                                Page         29
3.5               KILDARE BYPASS


General Information
                                                                     PROJECT DETAILS

                               Co. Kildare
                                                                           Rout e:                  N7 Kildare bypass
     Co. Offaly




                                                                     M7
                                   Newbridge
                                                                           Length of Project:       12km
                     Kildare                               M7
                                             N7

                                                                           Proposed Standard:       Motorway

                                                                9
                                                                M
      N7




                                                                                      Motorway under construction
                                                                N9



 Co. Laois                                             8
                                                  N7




This project entails the construction of approximately 12km of new national primary road N7 to a 4 -
lane divided Motorway standard.                                      The new motorway will tie into the M7 at the Ballymany
interchange west of Newbridge, and will finish approximately 3km eas t of Monastervin.


This project will form part of the Dublin/Limerick and Dublin/Cork schemes, and will contribute to
the NRA policy objective of linking Limerick and Cork with Dublin via Mot orway/High Quality Dual
Carriageway with a consistent design standard and cross-section.


Programme
General
The overall project programme is summarised in Table 3.5.1 and present ed graphically on Figure
3.5.1 below. Three programmes are shown, namely, the original strategic programme developed
by the NRA/ County Council (Blue progress bar shown as “Planned”), the revised programme
developed by the consultants after appointment (Yellow progress bar shown as “Revised”) and the
actual recorded progress (Red progress bar shown as “Actual”. The project is currently in Phase 6.


 Table 3.5.1: Project dates
 Phase                   Phase start date                                       Phase end date                      Phase period
                  Planned   Revised       Actual                          Planned  Revised     Actual     Planned     Revised       Actual
 1
 2                   -                -                    -                 -         -         1993        -           -             -
 3
 4                   -             -                   07/93                 -         -         01/96       -            -          30M
 5                  <95           <95                  02/96               02/99     10/00       11/00       -            -          57M
 6                 09/97         07/00                 11/00               01/01     01/04      current    39M          42M         Current




                                                                                                                             Page             30
Figure 3.5.1: Project programme

                OVERALL PROJECT PROGRAMME FOR N7 (KILDARE BYPASS)
                                         << 2000     2000      2001        2002   2003     2004       2005   2006    2006 >>
                              Planned
    1. Overall Project
                              Revised
    Planning                  Actual
                              Planned
    2. Constraints Study      Revised
                              Actual
                              Planned
    3. Route Selection        Revised
                              Actual
                              Planned
    4. Prelim. Design/
                              Revised
    Land Acq. Proc.           Actual
                              Planned
    5. Constr. Doc. Prep./
                              Revised
    Tender/Award              Actual
                              Planned
    6. Scheme
                              Revised
    Construction              Actual
                              Planned
    7. Final Account/
                              Revised
    Closeout                  Actual


                   Initial NRA Planned             Revised (Consultants)             Actual to date           Not Finished



Phase 1 to 4
The route selection report (1991) and EIS (1993) were finished prior to the publishing of the
CPO/MO on 30 July 1993. A Public Enquiry was subsequently held in November of the same
year, where concerns were raised about the impact of the scheme on P ollardstown Fen. The Fen
is a unique habitat located some 4.5km from a section of the proposed new motorway in cut. At
the time it was feared that the new scheme could significantly impact on the Fen through a
lowering of the groundwater levels in the area.


The CPO/MO was confirmed on 19 January 1996, subject to some conditions set out by the
Minister of the Environment, which included the following:
     Raising of the initial vertical alignment through the cutting by some 2m.
     Runoff from the road to be kept separate from the adjacent groundwater.
     The establishment of a Monitoring Committee res ponsible for overseeing further investigations
      into the impact of the road on the Fen.


Although no det ailed information on the early programme stages is available, it is estimated that
the Public Enquiry and subsequent Environmental conc erns delayed the process by some 18
months.




                                                                                                      Page      31
Phase 5 – Construction Documents / Tender Award
Planned phase period:            Ending February 1999
Actual phase period:             Ending November 2000


The final design of the road culminated in a main contract and three preliminary contracts being
published for tender. The main contract was put on restricted tender on 11 March 1998 after a
prequalification process.


A complaint was lodged to the European Commission during the tender process conc erning t he
impact of the scheme on the P ollardstown Fen. This resulte d in the revision of the design, and
subsequent changes to the t ender. This process significantly delay ed the tender process, and t he
tenders finally closed on 11 April 2000. The design changes incorporated the lining, or “t anking” `,
of t he section of road through the cutting using an impermeable membrane, supplement ed by a
layer of impermeable boulder clay which would guarantee the long-term effectiveness of t he
approach.


The total period of time used for finalising the design, from the confirmation of the CP O/MO on 19
January 1996 to the invitation to tender on 11 March 1998, was about 26 months, which is
unusually long. This delay can be attributed to the unusual design requirements resulting from the
public enquiry.    Various experts were consulted during the design, including consultants from
Holland (especially in the design of the “tanking” area) and geotechnical experts.


Initial programmes showed the planned duration of t he tender period to be about 10 months, while
the actual tender period extended some 25 months, resulting in an overall delay of 15 months. A
further delay was caused by an extensive process of tender evaluation due to the unique nature of
this project.     The contract was signed on 10 November 2000, and the contractor started
construction in January 2001.


It must be not ed though that the three preliminary contracts that were completed before the start of
the main contract contributed very favourably to the reduction in estimated completion time of the
main contract, due to some of the critical activities for construction being finis hed before the main
contractor moved to site.


Phase 6 – Scheme Construction
Planned phase period:            November 2000 to March 2004 (39 months)
Actual phase period:             November 2000, in process


Construction on this scheme started on 15 January 2001. As mentioned earlier, three preliminary
contracts were completed prior to the start of the main contract, resulting in substantial time



                                                                                      Page         32
savings on the main contract. At present the contractor’s progress is sli ghtly ahead of schedule,
and no serious delays have been experienced up to date.


It is expected that the contract will be complet ed within the allowed contract period.


Financial Progress
This project is funded solely by the exchequer.                    The initial total project cost estimate, revised
estimate and actual expenditure to date per phase are summarised in Table 3.5.2 below. All prices
quoted in this section are inclusive of VA T.


    Table 3.5.2: Actual vs. Planned Expenditure (All values are inclusive of VAT)
    Phase            Initial cost estim ate         Revised cost estim ate            Actual cost /
                         (1997 values)                  (2000 values)                 Cost to date
    1
    2
    3            €                  7,813,968                                -                             -
    4
    5
    6            €                 70,325,714                                -                             -
    7
    Total        €                 78,139,683   €                111,063,992     €                57,307,066



The initial cost estimate of € 78,139,683 was done by the NRA/County, and a breakdown of t he
total into phases 1-5 and phases 6 & 7 has been achieved by using a standard percentage
allocation to the various phases, as obtained from the NRA. The initial cost est imate amounts to
€92,958,873 in 2000 if inflation is accounted for.


The revis ed cost estimate was done after the award of the tender for the main contract, and t he
tender amount for the main contract was used in determining this revised estimate. No details as
to the breakdown of this value into the different phases are available.


This revised cost estimate is 42% higher than the preliminary cost estimate. Escalation accounts
for 19% of the difference, additional work for a further 5%, and the remaini ng 18% is the
preliminary estimate error.


As mentioned in section 3.5.2 (c), three preliminary contracts were finished prior to the start of t he
main cont ract. These contracts amount ed to a total spending of some €11.7m (VA T incl.). The
tendered amount for the main contract was €75,434,475 (2000 prices, VAT incl.).


A risk buyout package was agreed with t he contractor at a total sum of €46.34m. This amount
includes for:
       A buyout of the PV C (P rice Variation Clause), and therefore limits the risk of inflation to the
        client




                                                                                                      Page      33
   Other risks, particular the tanking and dewatering operation, Foot & Mouth protocols and
    archaeology
   Additional work to a total value of €7.7m (VA T incl.) to be treated as remeasurements at the
    billed rates.


Some major additional works were commissioned during the main contract, including t he inclusion
of the Mayfield interchange at t he western tie-in point, which was originally proposed as part of
another scheme, and the provision of safety fencing on the median due to changes in the design
guidelines.   The construction of the Mayfield interchange as part of this scheme will result in
subsequent savings in the adjacent Heat h – Mayfield motorway scheme. The additional work on
the project is expected to be less than the value of €7.7m allowed for in the risk -buyout package.


If the risk buyout and additional works are taken into account, the main c ontract value will total
€120.57m (incl. VAT), and the total project cost some €157.83m (incl. VAT).


At present, the actual costs follow the planned expenditure closely, and no major cost overruns
have been ex perienced.


The buyout of the potential claims greatly reduc es the risk to the client in terms of cost overruns.
The extra work that will be completed as a re-measurement on this contract due to the buyout is
good value for money, and an additional advantage is the incentive for the contractor to finish as
soon as possible to avoid price escalation due to inflation.


Project Management, Procedures and Institutional Arrangements
Most of the procedures relating to the constraints study, route selection, preliminary design, final
design and t ender process were finished prior to the publishing of the P roject Management
Guidelines, and the guidelines are therefore not directly applicable to this project, although the
principles as set out in the PMG were applied during these phases.


The following project management procedures are in place at present:
   Monthly progress meetings wit h the contractor
   Additional monthly liaison meetings (Management Team meetings) with the NRA
   Monthly reports to the PRS, covering both the financial and physical progress
   Various quality management systems, including additional independent laboratory tests of
    materials used on the site.




                                                                                      Page        34
        Summary, Conclusions and Recommendations
                                                N7 KILDARE BYP ASS
                                               PROJECT PROGRAMME
Start date:                                Early 1990s
Construction Start date:                   November 2001
Construction End date:                     Expected April 2004
Current Progress:                          Phase 6 (Construction)
    The project is currently under construction.      At present the contractor’s progress is slightly ahead of
     schedule, and no serious delays have been experienced. It is expected that the cont ract will be completed
     within the allowed contract period.
    Severe delays due to environmental concerns were initially experienced.
                                                COST MANAGEMENT
                                    Preliminaries, Land, Design &
    Cost Description       Date                                            Construction                   Total
                                              Management
Initial estimate:          1997                         €7,813,968              €70,325,714                €78,139,683
Revised estimate:          2000                                     -                       -             €111,063,992
Actual to date:              -                                      -                       -              €57,307,066
Construction Tender Value:          €75,434,475
*All values include VA T at 12.5%
Procurement & Funding:              Conventional Tender. Exchequer
    This revised cost estimate is 42% higher than the preliminary cost estimate. Escalation accounts for 19%
     of the difference and additional work (scope changes) for a further 5%. The initial estimate therefore
     underestimated the project cost by 18% (if inflation and scope changes are accounted for). Initial costing
     for budget purposes is based on unit rates per kilometre only. Although this may be accurate for
     programme level assessment, the method may not be sufficiently accurate for the purpose of individual
     project cost estimation.
    At present, the actual c osts follow t he planned expenditure closely, and no major cost overruns have been
     experienced.
    An agreement has been reached between the client and t he contractor on a buyout of t he PV C, various
     risks and additional work. This buyout has result ed in several positive aspects, including limited risk in
     terms of cost overruns due to claims and inflation and an incentive to finish the project earlier.
    The initial and revis ed estimates for scheme construction do not make al lowance for escalation/inflation and
     contingencies. The outturn cost will therefore invariably be higher than the initial estimate/tender price.
                                              PROJECT MANAGEMENT
    It appears that the Project Management procedures followed on this project are adequat e.




                                                                                                Page              35
Annex 3           International Case Studies


1.        Introduction


1.1       Purpose
This annex presents a review of the international case studies undertaken as part of t he study.
These case studies include a review of the delivery mechanisms for roads programmes in a
selected number of countries. The purpose of the review was to:


     contrast the approach taken in the review countries to that in Ireland;
     identify lessons learned in the review countries and potential ways of improving the
      effectiveness of delivery and management of the Irish programme;
     identify international best practice and benchmark activities where practicable.


1.2       Methodology
The case studies were prepared on the basis of information gathered from visits to relevant
officials in the respective count ries. The respective officials were first identified and then circulat ed
a brief questionnaire highlighting the key areas of interest for the study. This was followed up with
a face-to-fac e meeting, at which the questionnaire was completed.




                                                                                          Page           1
2.        Selection of Case Study Countries


2.1       Criteria


The following criteria were taken int o account in identifying relevant project case studies:


     the similarity of the review count ries to Ireland in terms of, inter-alia, population density, road
      density, total length of roads in the country, road network density, car ownership, road network
      usage etc;
     potential for the review countries to inform the overall study on issues relating to progress, cost
      control and effective management of the road network;
     salient characteristics of the road programmes in the review countries:
             co-financing by the European Union;
             procurement methods (e.g. PPP, “Design and Build”, conventional);
             private sector involvement;
             use of toll roads and tolling;
     specific issues being handled by the review countries that are of int erest to Ireland (e.g.
      procurement, tolls, PPPs etc).


2.2       Selected Countries


The Steering Committee for the study required that the international case studies have a primary
focus on EU member states. All 15 member states were therefore evaluated along demographic
and ot her criteria. Based on these criteria, Portugal, Greece, Denmark, Finland and Austria were
all found to be similar to Ireland, but with Portugal and Finland being of particular interest. In
addition the UK, given its proximity to Ireland and its leading role internationally in developing
delivery mechanisms for the provision of roads, was also found to be a suitable candidate.


Portugal has a well advanced PPP programme and a six-year E U co-financed road investment
programme, worth €11.5 billion from 2000-06. This makes it a suitable comparator for Ireland. In
particular, the overall approach to the programme and the PPP approach adopted could be
usefully reviewed.


The Scottish road net work is of similar scale to Ireland’s. It was largely developed using the UK
approach to roads provision, and t he P IARC (the world organisation of Roads Authorities ) has
previously acknowledged Scotland as an implementer of innovative procurement and cost control
methods for highway construction and maintenance. Scotland was therefore the s econd case
study country chosen.


The Scandinavian approach to road provision is internationally acknowledged, and S weden,
Norway, Denmark and Finland all have commendable approaches to roads management. The



                                                                                          Page          2
approach in Finland to the maintenanc e of their road network is of particular interest. It is therefore
the subject of the third case study.


Table 1 below summarises the selected countries and some salient figures on the countries
concerned.


Table 1: Comparative Table of Case Study Countries
                                 Ireland           Portugal               Scotland                 Finland

Area (km2)                       69,000             92,141                 78,133                  338,000
Population                      3,777,000         10,400,000              5,120,000               5,171,000
Pop. density (/km2)                 55                112                     66                      15
Total length of roads            92,500             69,000                 54,000                   78,000
Road density                       1.34              0.75                     0.7                    0.23
Cars/1,000 inhabitants             309                371                    378                     417
Roads budget                  €959,369,000       €802,500,000*          €384,000,000            €786,000,000
% new construction                 85%               55%*                    25%                     12%
Use of PPPs                        Yes                Yes                  Limited                   Yes

* Excludes private sector investment of €1 bn.
Source: Scottish Executive ; Finnra ; IEP


Table 2 below summarises the selected countries and the main focus of int erest in eac h.


Table 2: Selected Countries and Main Focus of Interest
Country                                                Focus

Portugal                                               PPPs and overall approach
Scotland                                               Procurement, cost control and value-for-money
Finland                                                Integrated netw ork maintenance management




                                                                                              Page             3
3.      Case Study - Portugal


         PORTUGAL
                                                          Size:                          92,141 km 2
                                                          Population (2001):               10.4 mn
                                                          Population density:        112 inhabitants/km 2
                                                          ROAD DETAILS
                Porto (
                      X                                   Total length of roads:         69,000 km
                                                          Nationals:                     11,053 km
                                                          Other:                         58,593 km
                                                          Road density:                 0.75 km/km 2
                                                          Freight:                     14.2 bn ton-km
                                                          Traffic growth:          3.4% p.a. (1997-2000)
                                                          Cars/1,000 inhabitants             371
                                                                                    Instituto das Estradas
                                                          Road Authority’s name:             de Portugal
                                                                                            (IEP)

                   #
                   Y                         Spain        2001 roads budget:
                                                                                   €802.5 mn (excl. private
                                                                                        sector €1 bn)
          Lisbon
                                                                                      55% (excl. private
                                                          % new construction:
                                                                                           sector)
                                                                                    Yes (45% of national
                                                                                       network under
                                                          Use of PPPs:
                                                                                      concession upon
                                                                                         completion)



3.1      Introduction


Portugal is currently implementing its National Road Plan 2000. This plan is a follow -up to the
1985 Plan in which the need for and nature of the national road net work was defined. The 2000
Plan aims to complete the P ortuguese national road network by 2007 with the help of an
aggressive PPP road concession plan. Without the PPP element, it is estimated that it would take
up to 2014 and beyond to complete the network.


Portugal was of interest to Ireland due to the similar situations of the t wo countries, i.e. the need
for better road infrastructure and for a programme to deliver that infrastructure in each. Also of
interest to Ireland is the use of PPPs in Portugal to accelerate the implementation of the National
Road Plan.




                                                                                       Page             4
3.2     Institutional Structure


The Ministry of Public Works, Trans port and Housing is responsible for road policy in Portugal.
Reporting to this Ministry are three “Institutes” with a strong roads involvement, one to plan and
regulate t he national road net work, one for new construction (cont racting) and one responsible for
network maint enance. The second and third “Institutes” are executing or contracting entities. The
first, called the “Instituto das Estradas de Portugal” (IEP) is similar to the NRA in Ireland in its role
as the planning and procurement organisation. The IEP is therefore required to carry out ongoing
strategic planning, programming, budgeting and planning activities as well as being responsible for
the implementation of the National Road Plan 2000.


3.3     Nature of the National Road Plan 2000


The IEP deals with four road categories, namely main roads, complementary roads, other national
roads and regional roads. In addition, there are municipal roads managed by the local authorities.
The implementation of the main and complementary roads is the focus of the National Road Plan
2000.


The main and complementary roads (t he major national roads) will constitute 5,903 km once they
have been completed. Of these, 3,107 km will be of motorway standard (45% of which is
completed to date).


2,660 km of the total 5,903 km will be under the responsibility of c oncessionaires, including some
existing roads. In this way, 45% of the national road net work (as defined in the National Road
Plan) will be under conc ession, whether under hard tolls (1,757 km, or 66%) or a shadow toll
scheme (902 km, or 34% ).


3.4     Financial Aspects


The non-concessioned network is being funded out of the State budget and EU subventions. The
concessioned network is funded fully by debt and equity. Total IEP and private sector expenditu re
on roads over the period 1998-2002 is shown in Table 3 below. The private sector is responsible
for a significant portion of the new construction budget in P ortugal. In addition, the E U contribution
to road expenditure has grown substantially.




                                                                                         Page           5
Table 3: Investment by Source of Funding (€mn)
Source                     1998           1999              2000                 2001           2002*

State budget              584.9           493.1             506.5                499.7       597.1
EU subventions             59.4            26.3              88.6                245.7       412.4
Other sources               9.9            66.5               6.0                 58.2        29.6
TOTAL STATE               654.1           584.9             600.1                802.5      1,039.1

Private sector               -            127.3             472.7            1,011.9             n/a

TOTAL                     654.1           712.2            1,072.8           1,804.4             n/a

*Estimate
Source: IEP

Investment by type of work involved is as indic ated in Table 4. While construction makes up t he
largest portion of the road budget, there is also substantial investment in network upkeep and
rehabilitation.


Table 4: Evolut ion of Investment by Type of Work – State Only (€mn)
Activity                   1998           1999              2000                 2001           2002*

Construction              369.8           303.8             351.3                433.1       529.7
Rehabilitation            177.4           209.5             128.1                229.2       339.4
Others                    106.9            72.5              86.1                119.8       170.0
TOTAL (STATE)             654.1           585.8             565.6                782.0      1,039.1

*Estimate
Source: IEP


3.5         Objectives of the National Roads Plan 2000


The programme outlined in the National Road Plan 2000 aims to:


     improve territorial accessibility and communications quality (mobility);
     improve traffic flow (traffic);
     diminish time and operational costs (economy);
     diminish numbers of accidents (safety);
     diminish CO and NOx emissions (environment).


3.6         Programme and Project Management


The National Road Plan is comprised of a series of projects, which together make up the road
programme for Portugal. This programme is managed by the IEP. There is no formal project
management system, however. Usually, each phas e of the project (e.g. design and studies,
expropriations, construction) is conducted by different depa rtments, i.e. in a non-systemised,
fragmented manner.




                                                                                         Page           6
3.7     Project Selection and Prioritisation


The National Road Plan itself includes a prioritisation of t he road construction to be delivered. The
main objective of the plan is to complete the main roads and the complementary roads, in that
order. Traditional cost-benefit analysis is done on individual projects to ensure viability.


3.8     Relationship with Local Authorities


The IEP is responsible for the total national road network, comprising four categori es of roads.
The information available indicates that the third and fourth categories of roads are more regional
and local in nature and function, however. For this reason, local councils are encouraged to take
over some of the regional roads currently managed by the IEP. Where this takes place, the IEP
first upgrades or strengthens roads, before transferring responsibility to the local council.


3.9     Procurement


Previously, the Portuguese Government fulfilled all roads functions, from design t hrough to
construction and construction supervision (the three “Institutes” referred to in Section 3.2 used to
be a single organisation until 1999). The c urrent policy is to procure roads through conventional
contracts, “Design and Build” contracts (DB) or “Design, Build, Financ e and Operate” cont racts
(DBFO), with the private sector participating in the proc ess. The DBFO policy came into operation
in 1997. By the end of the National Road Plan, 2,660 km of roads will be under the control of 18
different conc essions, 10 of which are still to be granted.


It should be noted that the completion of the National Road Plan might be affected by a recent
change in Government in Port ugal. Constraints on overall Government expenditure imposed by
the EU may also necessitate restraint in implementing the full programme.


3.10    Road Construction Cost


For conventional procurement, Portuguese law limits increases in t ender prices t o 15% of t he
contract value. This ens ures that cost overruns are limited. Indicative construction costs in
Portugal are given in Table 5. These figures suggest that Portuguese construction costs are
comparable to, albeit slightly lower than, those observed in Ireland.




                                                                                         Page        7
    Table 5: Construction Cost per Km Excluding VAT (€mn)
                                                            Number of Lanes
          Type of Terrain
                                           2                     4                         6

           Plain                         0.945                   1.890                   2.834
           Rolling                       1.102                   2.204                   3.307
           Hilly                         1.260                   2.519                   3.779
           Urban                         1.575                   3.149                   4.724

    Source: IEP


3.11      Maintenance


Structural and routine maintenance is carrie d out on the full road network and funded out of t he
budget in an integrat ed (i.e. countrywide) manner. Routine maintenance is procured through third -
party outsourced contracts, i.e. the maintenance is carried out by independent contractors.


3.12      Experience with PPPs


Since 1997, a programme has been in place to draw the privat e sector into the P ortuguese road
programme so as to accelerate the construction of main and complementary roads. At the time,
one conc essionaire was already operational.


Conc essions are let for a thirty-year period. Concessions include newly constructed roads and
existing roads. They vary in length from very short (e.g. a bridge) to several hundreds of
kilometres. Both shadow tolls and hard t olls are employed on thes e schemes, depending on its
feasibility (i.e. hard tolls only where the scheme is self-financing through t olls). As not ed earlier,
2,660 km of road will be under the responsibility of concessionaires by the end of the National
Road Plan.


Elapsed time bet ween the tender notice for the concession and t he signing of the concession at
financial close is estimated at 18 months. The IEP considers it too early to indicate whether
concessions have led to cost and/or time savings during construction (though the acceleration of
the whole programme through the employment of PPPs is widely acknowledged).


3.13      Conclusions


     The IEP is a similar organisation to the NRA, with a similar objective.
     The National Road Plan 2000, with its associated construction programme, does not total ly
      dominate the expenditure of the IEP, and the IEP has a significant but separate road
      rehabilitation and maint enance programme under way. The IEP is therefore required to carry
      out ongoing strategic planning, programming, budgeting and planning activities outside of the
      main road investment programme.




                                                                                        Page          8
   Procurement for new works as part of the National Road Plan takes plac e in terms of t he
    “Design, Build, Finance and Operate” PPP model, “Design and Build” and conventional
    procurement methods.
   The National Road Plan relies heavily on the DBFO approach to finance and accelerate t he
    delivery of the plan. In practice, the private sector is at this stage providing more direct funding
    for roads t han the Government, and it is generally acknowledged that the program me is being
    delivered significantly faster as a result.
   The speed of contracting out DBFO projects is impressive, with the process taking an average
    of 18 months from initial announcement to financial close.
   Cert ain categories of roads are currently being trans ferred to local authorities for them to
    administer and maintain. This t rans fer can only take place if the road in question is in a “good
    state of repair”, however.
   The procurement of certain regional capital works and maintenance activities is being
    outsourc ed on a long-term basis and in an integrated manner.
   Estimated construction costs obt ained for P ortugal indicate a slightly lower maximum cost of
    construction (per kilometre of road) than that observed in Ireland.
   Portuguese law limits increases in tender prices to 15% of the contract value, which restricts
    cost overruns.

   The completion of National Road Plan might be affected due to a recent change in
    Government. Constraints on overall Government ex penditure imposed by the EU may also
    necessitate restraint in implementing the full programme.


3.14    Acknowledgements


The co-operation of the IEP and in particular the Head of Division, Ms Maria Fortunata Dourado, is
acknowledged with thanks.




                                                                                        Page          9
4.      Case Study – Scotland (UK)


         SCOTLAND
                                                           Size:                                 78,133 km 2

                                                           Population:                           5,120,000

                                                                                                 65.5
                                                           Population density:
                                                                                      inhabitants/km 2

                                                           ROAD DETAILS
                                                           Total road network:         53,886 km
                                                           Trunk road network:         3,488 km
                                                                                                             2
                                                           Road density:                         0.7 km/km

                                           Aberdeen                                    Varies from <1000vpd
                                                           Average daily traffic on
                                                 U
                                                 %                                     to >160,000vpd (M8
                                                                      trunk road
                                             Dundee                                   in
                                            %
                                            U              network:
                                                                                      Glasgow)


                                   X
                                   (     Y
                                         #                 Cars/1,000 inhabitants                378

                                                                                                 Scottish
                          Glasgow         Edinburgh
                                                                                      Executive/
                                                           Road Authority’s name:                Design and
                                                                                                 Construction
            Northern Ireland
                                                                                      Division
                                         England
                                                           2001 roads budget:                    €384 mn
           Ireland                                         % of budget that is new
                                                                                                 25%
                                                           major construction:

                                                                      Use of PPPs:               Limited



4.1     Introduction


Scotland has a trunk road net work (i.e. roads similar to the Irish national road network) of 3,488
km. This net work carries 1/3 of all Scottish road traffic and 57% of heavy goods vehicle traffic. The
net asset value of the net work is €5.5 bn, and current investment in the network is around €360 mn
per annum. Of this amount, approximately 25% is spent on major new schemes, with the rest
going to minor schemes, structural rehabilitation and routine maintenance.


The Scottish road network is comparable in scope to that of Ireland. As part of the UK, however,
Scotland has seen major changes in the manner in which the road network is managed. In
particular, Scotland has researched the advantages of various Design and Build contract
alternatives. It has also implemented the outsourcing of road maintenanc e services to local
authorities and to private parties. The purpose of this case study is therefore to revi ew the major
characteristics of the Scottish approach, especially with respect to cost and cost control.


                                                                                           Page             10
4.2     Institutional Structure


The Scottish Executive is the Executive Authority in Scotland, and roads are c ontrolled by the
Development Department through its Roads Division. The statutory vehicle that allocates
responsibility for roads is the Roads (Scotland) Act of Parliament. Policy and strategic decisions on
road investments are made at Executive level, and the Roads Division has the task of
implementing its charter in an efficient and effective manner.


Local authorities are responsible for their own road provision and maint enance (other than for
trunk roads). They are support ed by grants, but these grants are not tied to specific functions.
Local authorities have the authority, however, to introduc e congestion charges in their areas.
Should they do so, revenues accrue to them.


The trunk road system ensures that all local aut horities are linked to anot her local authority by at
least one trunk road.


4.3     Road Investment


New investment in roads is carried out on the basis of a multi -year road programme. This
programme is very much politically-driven, i.e. priorities are set by the political executive. The
current approach focuses on a multi-modal approach to transport, with roads being one of t he
solutions to the wider transport problem. Current priorities emanate from a programme developed
in 1999, and include five major new road schemes.


The annual budget varied around €360 mn in the early 1990s, then more recently declined to €270
mn (when the focus shift ed away from new road construction), but is now back at the €360 mn
level. This year, capital expenditure accounts for approximately 40% of the total road budget. The
rest is allocated to road rehabilitation and maintenance.


4.4     Maintenance Management and Procurement


The Scottish approac h to road maint enance management changed in 1996. Previously, Regional
Councils were responsible for maint aining roads in their jurisdiction. In 1996, he eight Regional
Councils were changed to 32 Councils, and contracts for the roads were let by council in a
competitive fashion. Two types of contracts were used – Operational Contracts and Management
Cont racts – initially for a shorter period of three years and later for five years.




                                                                                       Page        11
Today, Scotland has been divided into four quarters, and an operational contract has been let for
each quarter for a period of five years. These contracts have all been won by privat e sector firms.
The cont ractors are responsible for routine/cyclical and structural repairs on the basis of a
schedule of rates. Contractors operate a refined pavement management model and use this model
to develop a maintenance program, which the relevant council must approve. Some aspects of the
contracts are on a lump sum basis. Some risks have been shifted to the contractors, but risks
associated with imponderables remain the responsibility of Government. In essence, these
maintenance contracts are int egrated “Maintain and Operate” cont racts (analogous to DB
contracts for new roads). Consultants monitor the adherence to the contract by way of
performance audits.


Consideration is now being given to taking a furt her step forward and adding financ e to t he
contracts (this approac h is in line with current world practice as evidenced in countries varying
from the USA to New Zealand, Norway, Sweden, Finland and others). This would mean that the
contractor will not only have to maintain and operate the given section of t he road net work, but will
also have to finance the operations himself (similar to the DBFO contracts for new infrastructure).


4.5       Project Development and Value-for-money


Each potential major new roads project is assigned a projects sponsor, a project owner and an
investment decision-maker to ensure proper decision-making regarding the project. The project is
progressed through the project management process, with specific points being built in to
reconsider the total viability of the project. Steps involved are feasibility analysis, detailed planning,
and construction.


Value-for-money is secured by achieving the required quality at the lowest whole life cost. In
Scotland, they follow the England Highway Agency Value-for-money initiative, whic h moves away
from assessing scheme components by undertaking an appraisal of the complete product. The
principle objectives of VFM are to:


     set targets based on best practice;
     prepare detailed and accurate cost estimates;
     identify, monitor and manage potential problems and uncertainties;
     question assumptions and solutions offered;
     deliver schemes within programme and to budget.


This process of value-for-money appears to have the potential for application in Ireland, with a
view to better cost cont rol, since it questions the assumptions underlying cost increases on a
project. Costs on projects in Ireland have escalated for a variety of reasons, and Ireland may




                                                                                          Page         12
therefore benefit from a selected application of the value-for-money approach to test the potential
for limiting cost increases in this way.


4.6       New Works Procurement


The National Roads Directorate (NRD) in Scotland has fundamentally changed the way in which it
procures new works and maintenance contracts over the past 12 years. Prior to 1990, virtually all
procurement was in the form of “Measure and V alue” cont racts. The problem with this type of
contract is that there is often a significant difference bet ween tender and out -turn costs (typically a
25-30% increase at out -turn). The time to settle final accounts can also be excessive (typically two
years).


Against this background, an alternative tendering initiative was launc hed to give greater certainty
in cost and time for the works completion and t o reduce t he adversarial attitudes in traditional
procurement. Today, Scotland makes use of three basic forms of contract, namely:


     “Fixed P rice Lump S um wit h Employ er’s Design”. Contractors own time for completion (similar
      to traditional procurement used in Ireland);
     “Fixed P rice Lump Sum with Contractor’s Design (Design and Build)” (currently used on pilots
      schemes in Ireland);
     DBFO contracts for major schemes.


The exact type of contract to be used depends on the specific risk profile of the project.


Experience with this approach has been positive and out-turn costs are now closer to tender costs,
although the tender price is higher than before (10% higher).


Procurement for maintenance works has followed a similar approach, and the introduction of a
“Finance and Operate“-type contract on the basis of output criteria is now under consideration (see
section on maint enance above).


4.7       Construction Costs


Construction costs in Scotland were not readily available. Instead, estimates were obt ained for t he
UK in general (November 2000 prices). These c osts as set out in Table 6 and represent
construction costs for the pavement excluding all structures, design, land, compens ation, statutory
processes, diversions and VA T. In general, these costs would appear to be higher than t hose
evident in Ireland.




                                                                                        Page          13
    Table 6: UK Construction Cost per Km Excluding VAT (€mn)
                     Type of Road                                      Cost

       Dual 3-lane motorway rural                                     €6.673
       Dual 2-lane motorway rural                                     €5.714
       Wide single 2-lane motorw ay rural                             €3.278




4.8        Conclusions


      Institutionally, Scotland is somewhat different from the other case studies in that roads are not
       the responsibility of an Agency but of the Scottish Executive.
      Scotland, as part of the UK, is following a well researched process regarding all aspects of
       road procurement, maintenance and management.
      Ireland has to a large extent built this good practice into its design and project management
       manuals and policies.
      The Value for Money approach applied in Scotland appears to have merit for testing and
       implementation in Ireland, with a view to getting b etter control over total project cost control.
      The varied contracting method procurement process in Scotland is of use to Ireland and has
       in principle already been adopted (as evidenced by the four DB pilot projects currently
       underway).
      As far as maintenance of the road network is concerned, the Scottish model has significantly
       progressed in relation to efficiency and effectiveness from where it was 10 years ago.
      In as much as the experience is transferable, Ireland could learn much from the Scottish
       outsourcing model, a model in line with modern road management practice in many count ries
       of the world.


4.9        Acknowledgements
The assistance of the Scottish Executive and in particular the Chief Road Engineer, Mr John
Howison, is acknowledged with thanks.




                                                                                           Page             14
5.       Case Study – Finland


           FINLAND
                                                           Size:                      338,000 km 2
           Norway                                          Population:                5,171,000
                                                                                                            2
                                                           Population density:        15.3 inhabitants/km
                                                 Russia
                                                           ROAD DETAILS
                                                           Total length of roads:     78,000 km
                                                                      National:       13,849 km
                                                                      Other:          64,151 km

                                                           Road density:              0.23 km/km 2

                                                                                      26,500 million ton-
                                                           Freight:
           Sweden                                                                     km/annum
                                                           Average daily traffic on
                                                                                      1,856
                                                           national roads:

                                                           Cars/1,000 inhabitants     417

                                                                                      Finnish Road
                                                           Road Authority’s name:
                                                                                      Administration

                                                           2001 roads budget:         €786 mn

                                                           % of budget that is new
                                                                                      12%
         Turku                                             construction:
                      S
                      #
                                #
                                Y     Helsinki             Use of PPPs:               Yes



5.1      Introduction


The public road network in Finland consists of 78,000 km of roads, of which 64% are paved. Main
roads account for 13, 300 km of the net work and motorways for 549 km. One motorway was
constructed in a DBFO manner under a soft toll scheme. The public road net work carries 65% of
the road traffic in Finland.


The major issues in Finland wit h respect to public roads appear to be:


     serving the road user and the Finnish public at large;
     better use of existing facilities;
     long-term sustainability of the network;
     outsourcing as a method of procurement to drive efficiency;
     institutional reforms.




                                                                                         Page          15
Finland was of interest to Ireland with respect to its total approach to road management and its
overall national policy framework of providing mobility in the most efficient and environmentally
friendly manner.


5.2       Institutional Structure


The Finnish National Road Administration (part of the Department of P ublic Works) stopped
operating at the end of 2000. Its activities were carried forward by two new organisations
established on 1 January 2001, the Finnish Roads Administration (FINNRA) and the Finnish Road
Enterprise (FRE), a Stat e-owned enterprise. Both organisations operate under the Finnish Ministry
of Transport and Communications.


FINNRA was assigned the management and development functions with respect to all public (non -
private, non-city) roads. FINNRA has a staff of just over 1,000 employees. FRE was assigned t he
contractor and design functions of the previous organisation. The Finnish Road Enterprise
therefore started off as the sole provider of these services on the public road network.


After a transitional period of four years, FINNRA is to procure all road management services (new
construction and maintenance) on the open mark et. At the end of the t ransition period, the Finnish
Road Enterprise will be just another contractor/service provider that will have to win work on t he
open market. During the transition, competition is being phased in.


5.3       Core Functions of FINNRA


As a new organisation, FINNRA was given the opportunity to fundamentally review t he process by
which it had to deliver on the mission given to it in its establishing act. They identified four key
business processes that they are to drive. These are:


     road policy and development of strategies;
     road safety programmes;
     procurement of design, construction and maintenance of the road network;
     providing services to clients.


A strategic unit in FINNRA is constantly considering these four core business areas with a view to
fostering innovation and improvement. The organisation is further structured as follows:


         head office with corporate functions;
         regional offices responsible for all functions in their regions.




                                                                                      Page       16
FINNRA believes that the nature of road authorities in general, and FINNRA in particular, will
change radically in the future as a result of IT developments. The integration of IT int o the typical
design, construct and building processes, leading to a much closer integration bet ween t hese
functions in an environment of co-operation and partnership, is already starting to take plac e.


5.4     Road Programme Development


FINNRA’s general objectives deal with the following items:


       socio-economic efficiency;
       operational requirements of business life;
       regional and social equality;
       road safety;
       the environment.


The Ministry of Transport and Communications has t he core policy role for roads in Finland. As
such, they prepare a 20-year guide plan, with goals and objectives for FINNRA to follow. In
response to this, FINNRA prepares a five-year operational plan (within financial guidelines
provided by the Finnish Department of Finance). All projects in the plan must be fully justified on
the basis of need, economic viability and other criteria that may be requir ed, and all large projects
must be approved by the Finnish parliament before they are accepted. If a major scheme is so
approved, the finance is committed to the full project even though it might span a number of years.


5.5     Project Selection and Cost-benefit Analysis


Project selection is a rigorous process and involves multi-c riteria analysis. One such criterion is the
cost-benefit analysis (COBA). The government will accept no project with a cost/benefit ratio of
less than 2.0. At the time of the study, the exact COBA paramet ers were only available in Finnish.


5.6      Performance Management


The Ministry of Transport and Communications annually assigns specific output based
performance targets to FINNRA for the next year. It is up to FINNRA to decide how t hey will
achieve this. FINNRA is then monitored on progress with the achievement of the targets on a
quarterly basis.


2001 targets to be achieved included:


       a specified reduction in the number of pers onal injury accidents;



                                                                                        Page         17
          satisfaction with the flow of traffic to remain at present level among key user groups;
          a specified reduction in the amount of de -icing salt to be used;
          specified length of road (km) where ground water protection should be implemented;
          a maximum level of substandard pavement on the roa d network;
          specific targets for the number of cont racts to be openly tendered.


The annual budget for FINNRA is relatively stable at t he €750 mn a year level for the next 4 -5
years. The programme currently does not involve a huge amount of new road construction, but
rather focuses on maintenance and rehabilitation of the existing network.


5.7        Road Construction Costs


Indicative construction costs for a wide variety and categories of roads in Finland are available in
                                                     1
2000 prices. Motorway construction costs                 vary from €1.11 mn to €7.39 mn per kilometre,
depending on t he urban/rural nature of the road and the difficulty of the terrain. Costs include
general work, cutting, loading and shipping, acquisition and handling of embankments, paving
SMA (stone mastic asphalt), AC (asphalt concrete), ground concrete layer, broken rock layer,
drainage-course, non-freezing ground layer, grass planting and landscaping of slopes. Land and
administration costs and VAT are not included.


    Table 7: Construction Cost per Km Exclu ding VAT (€mn)
                                                         Nature of Construction Conditions
          Type of Terrain
                                           Easy                      Average                 Difficult

            Rural area                     1.11                        1.48                    2.22

           Built-up area                   1.29                        2.03                    3.14

            Urban area                     1.48                        3.70                    7.39

    Source: FINNRA


The indicative costs shown in Table 7 appear to be comparable to Irish costs. The estimation of
construction cost is a problem, however, and out-turn costs are higher t han estimated costs. More
details were not available, and the issue is currently the subject of research.


5.8        Procurement


Procurement is a critical function. FINNRA believes that procurement should involve the client
organisation specifying outcomes and t he contractor c arrying out design and construction. The
design, build and maintenance option is therefore the preferred method of proc urement. It is felt
that this provides the opportunity and inc entive for the private sector to innovat e technologically in



1
    Source: Finnish Road Administration, “How Much? Road Management Costs in 2001”.


                                                                                              Page       18
the design and construction process. It is also felt that the integration of IT into design,
construction and management will eventually dictate the progress of innovation.


FINNRA is mainly procuring capital works on the conventional model of design, contract and build.
They have made great progress in procuring maintenance contracts in a different and more
integrated way through the letting of contracts for a whole region of roads rather than individual
sections and for a longer period of time, typically 3-5 years.


5.9     Maintenance Procurement


In the pre-2001 period, all maintenanc e was carried out by the Department of Public Works. In
2001, maintenanc e staff in the Department of Public Works were trans ferred into the Finnish
Roads Enterprise(FRE), a new and self-financing State company. The FRE was initially given the
task to continue to maintain all roads. The intention, howeve r, was to procure road maintenance on
a competitive basis in future. The monopoly of the FRE was therefore to be phased out over four
years, and new private sector companies were to be given the opport unity to tender for the work.
The first round of these t enders has now taken place and some contracts have been won by new
private sector companies.


A second and more important part of the maint enance procurement programme is the
development of an integrat ed approach to the procurement of maintenance. This m eans letting
whole net works of roads in a region to one cont ractor and for an extended period of time in a
competitive manner. Tot al cost savings of up to 40% are expected on the net work. The first round
of tendering has already brought savings of 9%.


In order to support the development of the maintenance proc urement process, FINNRA
commissioned a review of international practice in this regard. In brief, it was found that several
countries from around the world are experimenting with the development of more integrat ed
procurement processes such as DB, DBFO, etc for maintenance in addition to new infrastructure.
Britain is regarded as a leader in t his regard, with respect to both capital and maintenance
projects.


5.10    Experience with PPPs


Approximately four years ago, a major piece of highway was procured by way of a DBFO on a 15-
year concession, wit h soft tolls generating the inc ome required to service the full cost of the
project. The total value of the project was €200 mn. Construction costs were approximately €100
mn. The project was complet ed 12 mont hs earlier than programmed, and the contractor reduced
construction costs through rationalisation of design, etc. No tolls are charged directly to the users,
but the Government is paying the concessionaire shadow tolls. The annual payment by


                                                                                      Page         19
Government to the concessionaire is now, in hindsight, viewed as being too expensive, and this
has become a political issue. No further DBFO schemes are currently being considered.


5.11    The Environment


FINNRA has a five-year environmental policy and plan for the environment. The environment is
integrated into all activities of the organisation, from strategic planning to detailed considerations in
the management of winter maintenance. The details of this plan is outside the scope of this brief

review, but more information is available from the Finnish Road Administration.


5.12    Conclusions


   The institutional structure for roads in Finland has recently been revised with a view to better
    governance and a focus on the delivery of quality services to the end user. FINNRA (planning
    and regulatory authority) and the FRE (designer and contractor) were formed as a result.
   FINNRA approaches its task from a total road management system approach and as such
    exemplifies the latest in international thinking and good practice on road management
    practice.
   Procurement takes place on a competitive and outsourced manner for both new works and the
    maintenance of roads.
   “Design and Build” and other integrated procurement methods are supported.
   The procurement approach of longer-term integrated contracts on a regional basis for both
    capital and maintenance projects is significant, and indications are that savings are being
    achieved. FINNRA researched international best practice in this regard before embarking on
    this approach.
   The FINNRA approac h is based on the availa bility of data from a fully integrat ed management
    information system that provides all relevant information on a particular section of road in a
    related or integrated way. For example, the database (generally a Geographic Information
    System) would present and link data such as traffic figures, condition of the pavement, recent
    maintenance history, planned resurfacing, adjacent land use, road furniture etc for any section
    of road, enabling decision-makers to identify trends, plan expansion or rehabilitation in an
    optimal way.     The GIS will typically also have computer models associated with it to drive
    optimal outcomes, be it for maintenance scheduling or for ensuring an acceptable rate of
    return on investment.

   The role of competition in the procurement of maintenance could be further ex plored in
    Ireland.




                                                                                         Page         20
5.13   Acknowledgements


The assistance of FINNRA and in particular the Deputy Director, Mr Tapani Maata, and t he
Procurement Director, Markku Teppo, is acknowledged with thanks.




                                                                           Page       21
6.      Indicative Best Practice and Implications for Ireland


Based on the information outlined in the case studies described above, indicative best practice
regarding road provision were identified, together with possible implications for Ireland. The
practices are indicative in that they are based on a subjective assessment of the information
gathered. The consequenc es for Ireland are for further consideration regarding specifics described
in the body of the main report.




                                                                                    Page        22
Table 8: Indicative Best Practices Identified in Case Studies
           Topic                          Indicative Best Practice                                 Im plications for Ireland
Institutional form and   Road authority with the task to deliver safer road systems             NDP is correctly dominating
function                 to the end user in the most efficient manner. Functions              activities in the NRA.
                         include:                                                               Broader road user-oriented
                                                                                              approach to be developed.
                             road policy and strategy development;                             Policy and strategy to be carried
                          procurement of design, construction and maintenance of             out more formally, also to inform
                           road network;                                                      priorities on NDP implementation.
                          road safety programme;
                          end-user services and level of service.

                         Focus is on setting standards and ensuring that the
                         standards are achieved (not doing the work).

Road programme                       Interactive process between Government and                      NDP is output of process of
development                  authority.                                                       interaction between Government
                                     Consideration of other modes.                           and NRA.
                                     Full use of analysis and prioritisation techniques,             Total netw ork approach w ith
                             e.g. COBA.                                                       focus on new construction,
                                     Output-based criteria to optimise costs and             rehabilitation and maintenance to
                             prioritise actions, e.g. road condition, traffic volumes,        become more prominent.
                             congestion, travel time etc.
                                     Information system and tools available to inform
                             decision-making.

Project development          Programme made up of individual projects or                      NRA project management
                           schemes.                                                           manual valuable.
                             Scheme development phased according to good                      Provision to be made for cost
                           project management principles                                      escalation in programme
                             Costing done at benchmarks along the way.                       management.
                             Costing done on full out-turn cost basis                         Consideration to be given to full
                                                                                              out-turn cost budgeting.

Cost control             Value for money approach:                                              Project management manual
                                                                                              invaluable to drive process.
                              targets based on best practice;                                  Consideration given to value-for-
                              detailed cost estimates;                                       money approach being introduced.
                              monitor potential problems and uncertainties;                    Consider improved full-cost
                              question assumptions;                                          budgeting for programme purposes.
                              deliver schemes within programme and budget.

                         Programme-level cost controls, e.g. central approval of
                         project variations.

Procurement              Follow a risk management and allocation approach.                      DB pilot projects to be evaluated.
                         Different contract forms allocate different ris ks efficiently:        Risk management approach to
                                                                                              selecting contracting method to be
                              conventional contracts – client carries risks;                 examined.
                              DB – contractor assigned more ris k;                             Maintenance management
                              DBFO – further assignment of risk.                             approach to be examined.

                         Same principles also applied to maintenance of national
                         and or regional road network.

PPPs                     Use of PPPs to speed up delivery and to secure private                  PPP process well founded.
                         sector finance for roads a definite international practic e.            Outcomes to be evaluated when
                         Details as to risk allocation, tolls, shadow tolls etc beyond          available.
                         scope of the review.




                                                                                                             Page            23
Table 8: Indicative Best Practices Identified in Case Studies
Construction cost                                                                                      Reasons for variations should be
benchmarking (costs                                       Construction Cost/km (Jan 2002)              considered.
include construction cost                   8
only for a two-lane dual
carriageway motorway,                       7
excl. structures, e.g.
                                            6
bridges and culverts,
and VAT)                                    5




                             million euro
                                            4

                                            3

                                            2

                                            1

                                            0
                                                Ireland       Finland   Portugal   UK   South Africa
                                                                                         (Gauteng
                                                                                         Province)

                            The bars with the darker shade indicate an average
                            minimum and average maximum cost.

Source: Case study Information and Conclusions




                                                                                                                       Page           24
Annex 4            Analysis of Local Authority Non-national Roads
                   Questionnaire

The following is an analysis of the results of a questionnaire issued to all City and County Councils
in relation to the Non-National Roads Programme. A total of 34 questionnaires were dispatched
and 31 (91%) were returned. This Annex presents the full results of the following questions:


Table 1 Question: Please Rank the Relative Priority you Assign to Different Selection Criteria in Practice?

                                             Most                                                           Least
                                             Im portant                                                 Im portant
                Ranking                           1             2              3             4     5                  6
Level of Road Usage                              11            15              1             1     0                  0
Category of Vehicles                              0             3            14              6     5                  0
Pavement Condition                               16             8              3             1     0                  0
Development Plan Criteria                         2             1              2            13     8                  2
Geographical Spread                               0             0              7             3    15                  3
Others                                            0             1              0             3     3                 16
Note: The table shows the number of respondents selecting each ranking by criterion




Table 2 Question: Which of the Following Project Reporting Systems are used?
                                                                                      No.                       %
Monthly Reports*                                                                       23                     37%
Quarterly Reports*                                                                      6                     10%
Management Meetings*                                                                   19                     31%
Reports to Council                                                                     11                     18%
Other                                                                                   3                      4%
* To Local Authority Management.




Figure 1 Question: Is a Specific Project Management IT System Used?


                          25                                                    22
                          20
                          15
                          10                  8

                           5
                           0
                                           Yes 27%                           No 73%
Yes=mainly Agresso, Conval, MS Project




                                                                                                 Page            1
Figure 2 Question: Does your County Operate a Formal Pavement Management System?



                       90                                    82.8
                       80
                       70
                       60
                       50
                       40
                       30
                       20
                                   6.9
                       10
                        0
                                  % Yes                     % No




Table 3 Question: What are the Main Benefits of the Non-National Roads Programme in your County?
(please tick the 3 most relevant answers)
Options Provided
Improved Speeds
Increased Road Safety
Reduced Road Maintenance Costs
Reduced Costs for Transport Operators
General Boost to Investment/Economic Development
Support for Housing Development
Improved Quality of Life for Local Residents
Improved Tourist/Visitor Access
Improved Access to Remote Rural Areas
Improved Access to National Primary Road Network

Three Options Most Selected
Reduced Costs for Transport
Increased Road Safety
Improved Tourist/visitor access




                                                                             Page          2
Table 4 Question: To What Degree* Does Each of the Following Socio-economic and Environmental
Issues Impact on Project Selection or Project Management of the Non-National Roads Programme in
your County?

a) Links to National Primary/Secondary Roads                                                                              %
Significantly                                                                                                            56%
Somew hat                                                                                                                16%
Not at all                                                                                                                6%

b) Investment under the National Roads Programme
Significantly                                                                                                            44%
Somew hat                                                                                                                28%
Not at all                                                                                                               13%
c) Integration with Public Transport Services
Significantly                                                                                                            22%
Somew hat                                                                                                                47%
Not at all                                                                                                               16%
d) Environmental Protection Considerations
Significantly
                                                                                                                          9%
Somew hat
                                                                                                                         56%
Not at all
                                                                                                                         22%
e) Impact on Rural Development
Significantly
                                                                                                                         56%
Somew hat
                                                                                                                         19%
Not at all
                                                                                                                          0%
f) Impact On Social Inclusion
Significantly
                                                                                                                         38%
Somew hat
                                                                                                                         41%
Not at all
                                                                                                                          6%
g) Contribution to Balanced Regional Development
Significantly
                                                                                                                         41%
Somew hat
                                                                                                                         28%
Not at all
                                                                                                                          3%
h) North-South Co-operation
Significantly
                                                                                                                          6%
Somew hat
                                                                                                                         22%
Not at all
                                                                                                                         22%

* Responses do not total 100% as some local authorities did not provide any answer to certain questions.



Table 5 Question: The Length of Road Improved/maintained is Currently Used as a Performance
Indicator for the EU Co-financed and Restoration Sub-measures. Could you Suggest Additional
Indicators that Could be Used to Measure Performance under the Non-National Roads Programme?
Summ ary of Suggestions Received:

     area of roads (m²) should be used as opposed to length of roads improved or maintained, as many roads have varied
      widths;
     expenditure on improved roads w ithin a five year period of carrying out the works;
     record/monitor surface dressing cycles, and compare them to recommended cycles;
     cost per km or m² for different pavement thickness. SCRIM and ARRAN surveys on completed surfaces;
     % of total road netw ork improved per annum;
     reduction in public liability claims;
     survey of elected members;
     riding quality, skid resis tance, FWD output;
     number of hazards removed;
     the % of roads that meet the pavement condition index (PCI) range of 65 or better, this would require regular surveys.




                                                                                                     Page            3
Table 6 Question: Please Provide Details of the Unit Costs for Road Maintenance, Improvement and
Restoration Between 1999 and 2001?
                                                                                          2
                                                   Average Costs of Respondents’* € per m
                                                                              1999   2000      2001
            Surface Dressing                                                  1.89   2.00          2.13
            Restoration                                                       3.10   3.30          3.93
            Road Reconstruction                                               7.10   8.40          9.05
* City Councils Excluded from Analy sis as their Costs are Signific antly Higher




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