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Wednesday, June 04, 2014

7/8ths Of Money For Scottish Government Projects Is Disappearing & No MSP Or Civil Servant Will Say Where

 This is a motion Glasgow branch agreed to put into our AGM. However the AGM has been postponed for the far indeterminate future, something I regret as among other things, issues of importance to the party can only be discussed by party members in such informal ways.

UKIP policy paper #2
UKIP objects to our government projects costing 8 times what they do elsewhere
Proposed by Neil Craig Motion wording, suggested by Robert Malyn

  As a matter of law our elected MSPs and councillors are responsible for spending our money prudently but when I asked all 129 MSPs why the new Forth Bridge was so expensive only 2 replied. One said his party (Greens) had opposed it, which was true but not on the grounds of too much pork barrelling but because it wasn't all going to "Green" supporters and a LibDem of my acquaintance who got somebody to look up the record as discussed at the end. This did not result in any specific answer as to why they promote this massive disappearance of our money or where, specifically, it goes.

Though an FoI reply underlined at the end does, if not giving any explanation of where the money goes, at least explain the formula applied to its going.

Though the Forth Bridge is the most glaring example of most of the taxpayer's money going walkabout it is not abnormal as to the ratio of disappearing money that our politicians simply refuse to account for. Here are 20 examples:

1 - New Forth Bridge, costing £2,300 million. Previous bridge cost £19.5 million which, converted for inflation means the new one could have been built for £320 million. To be fair to the SNP the previous Lab/Lib estimate was £4 billion.  [8 times]

2 - Scottish parliament. Originally offered a fixed price contract for £40 million. Donald Dewar went on air to say "Tam Dalyell is wicked to suggest it will cost 1 penny more than £40 million". Officially costed at £431 million though there may be undisclosed landscaping costs.   [11 times]

3 - Edinburgh Trams. If, after interest, they come out at less than 1 billion it will be surprising despite them being half the length originally promised. In fact if the cost the same as equivalent Australian examples the full length should have cost no more than £110 million. In the sole legal case on the overruns on what was originally said to be a fixed price contract TIE lost because the court found them responsible for at least 90% of overrun. TIE brought no further cases but enforced gagging clauses in the contract they had competently negotiated.   [9 times]

4 - Aberdeen bypass. The average European or American road costs £2.4 million per mile. The average Russian costs £6.3 million, but that is said to be a mixture of the survival of Soviet style bureaucracy combined with rampant corruption. The Aberdeen bypass cost £23.3 million per mile.
[10 times]

5 - The M74 Glasgow bypass was (like the Olympics) proudly boasted as coming in under budget and on time. This remarkable feat, a mere £692 million)  was achieved by the simple expedient of continuously increasing the budget, which started at £177 million, and extending the completion date.

£ 138 million per km. By comparison an FoI request showed motorways normally cost £6.8 million per lane per km, less than 1/10th of the price. As the minister in charge, Alex Neil, said "This is clear evidence of our robust and effective management of major projects such as this" and who could disagree.     [10 times]

6 -  Skye Bridge. As this was a PFI project it was comparatively close to budget. When the Bridge contract was first awarded, the partnership estimated it would cost around £15 million, although delays and design changes required by regulators added significantly to the cost (to around £25 million) though ultimately after several years of politics the PFI contract was bought back for what is estimated to have been an overall cost of £56.8 million.     [4 times]

7 - Forth Tunnel estimate. This makes the bridge look good, but if we were to assume that was deliberate we would have to accuse John Swinney of lying to parliament and parliamenr being happy to be lied to. He informed them that a Forth Tunnel would cost £6.5 billion, surpassing the world's longest - the 57 km Gothard Tunnel under Switzerland by £300 million. Even worse the Norwegians and Faroese have been cutting hundreds of km of tunnels at about £3 million per km which would make a Forth Tunnel cost under £30 million.
   [ 216 times]

 8 - Interconnector cable - A cable to take windmill electricity from the Hebrides to the mainland, a distance of about 30 km, is to cost £775 million. By comparison the Norwegians laid a 292 km table at a cost of £50m. My letter on this was published by 2 papers though I only learned about the 2nd months later from somebody so impressed that they had kept a copy and sought me out.   [15.5-152 times]

9 - Shetland tunnel. Another unbuilt one. Shetland council got a quote for a Norwegian style tunnel to the island of Whalsay for £22 million which they redefined as £35 million - just above the cost of a new ferry. Except the ferry price turned out not to include a whole lot of necessary but unnoticed construction costs, taking it up to £53 million. Plus subsidised running costs. Plus improved port facilities. Thus,over the life of the ferry it is likely to cost ratepayers around £300 million. A few days after I wrote of this in the Shetland News the council executive wrote that they expected a decision to be made on a fixed link inside 2 months. That was July 2012.
 [13 times]

10 - Glasgow's George Square. The council decided to get rid of all the Victorian statues and make it trendy. This was priced at £15 million. Because of a public outcry, to which UKIP Glasgow contributed significantly, this was scrapped and it was decided they would limit the rehab to changing the glaring red tarmac (trendily put in by the council a few years previously) to a traditional shade. However, getting the last laugh at the public, the councillors confirmed that this recolouring, which should have cost £10s of thousands, was going to cost all £15 million allocated.

Incidentally the adjoining City Chambers were originally built for £580K, equivalent to £50 million now, only 3 times the cost of moving some statues.
  [150 times?]

11 - Iconic bridge. Glasgow council decided they wanted "a project" so they decided on a footbridge across the Clyde 200 yards from the George IVth bridge which carries road and foot traffic. By going for a trendy design they managed to make it cost £40 million. Again public opinion brought it low (though I was told off in no uncertain terms by the chief LibDem councillor for opposing it - I was then a member of that party & they don't like people thinking for themselves). In the end a compromise was reached - they built a less silly looking but equally unnecessary bridge for £7 million.

12 - Glasgow Airport Rail Link - This was a favoured project of the LabLib coalition. Originally promised at £130 million it inevitably crept up and was cancelled by the SNP government, at a cancellation cost of £40 million, when it had risen to £300-400 million.

      There was and indeed still is an alternative. An overhead automated rail link to Paisley station which has trains to Glasgow every few minutes and the bonus that it would link to Prestwick airport (which could have provided extra business allowing the 2 to work as a hub). The minister, Nicol Stephen, was a LibDem & I (have I mentioned I then thought the party liberal) suggested this. I got back a nice letter from his office promising that they were really interested but that, unfortunately, with no specific offer on the table, they could take it no further but would be really happy if I could come up with one. Buoyed up, even though I wasn't a committee with a £200,000 budget, I contacted ULTRA who were building a (now completed) much more complicated project of that sort at Heathrow Airport. They confirmed to both me and the ministry that this was perfectly feasible and they could contract for £20 million.

      I got a reply that when they said had been mistranslated from English and what they had really meant was that they would never, under any circumstances even look at any idea which had not originated from the heads of the 2 ruling parties.

      When the SNP came to power I contacted a senior minister (now retired) whom I knew and still respect to tell him of the offer. He passed it on the Transport and in due course I got a friendly letter telling me that unfortunately, until there was an official assessment proving this option "so clearly superior" they couldn't justify looking at it and until they had looked and done that assessment there was no such assessment.

      When the project was cancelled I did write to ask if doing the job for £20 million might now be considered clearly superior to doing nothing for £40 m but am still awaiting an answer.
     [20 times if it had been completed]

13 - Forth Crossing - keep the old bridge. The original justification for the new Forth crossing was that the cables on the previous bridge were in such a poor state of repair that the bridge could not be saved. By the time the Bill was passed for the new one this had changed to - the cables might or might not be repairable but it will take 6 months to find out and anyway the current bridge is to congested to keep working. Six months later the report came in and said that (A) the cables were significantly less corroded than had been originally designed for (B) they needed no replacement and (C) dehumidification equipment could keep them safe essentially indefinitely. I should also point out (D) that materials technology has improved so much over the decades that we could replace the cables with new ones orders of magnitude stronger and not subject to rusting if we wanted.

     The question of congestion, insofar as the problem was on the bridge itself rather than just needing an improvement of approach roads, was solved by an engineer named Tom Minogue.

    He told them that it would be possible to put a new lane down the centre of the existing bridge. By making this tidal - southflowing in the morning rush, northwards in the evening - traffic capacity could be increased by at least 50%. This would cost about £10 million. Not £2,300 million.

    Almost as if our leaders simply wanted an excuse to grab our money and didn't care how untrue the excuse, he was shown the door. To be fair it is conceivable that there was some other credible reason but if so I wish some of the party politicians involved would say what.
   [230 times]

  These are cases I know of. They tend to be the large ones but I understand the cost of repairing potholes, per pothole, has gone way up too, which may explain why they are less repaired than they used to be. However it is not just an assumption that an average of 7/8ths of public construction money put up by the taxpayer goes walkabout.
I mentioned earlier that one MSP, when prodded had had his assistant look up the records and it turned out that one committee had indeed asked why the new Forth bridge was going to cost so much more than similar bridges across the world (they hadn’t noticed the cost of the old bridge). The answer was that “there may be some geological reason” with which, I regret to say, they were satisfied.

That is obviously not an actual reason but merely the assertion that there may be some unspecified reason. Nor, obviously, was it truthful since the geology of the Firth of Forth where the previous bridge was built is not different from that of the Forth Estuary where the new one is.

I pressed on with a number of freedom of Information enquiries and got an answer marginally more responsive than that. I was told that for the intervening 40 years the costs of all public projects had been going up by an average of “4% more than the rate of inflation” for the rest of society. That does indeed mean every project. 4% a year compounded over those years does come out to an 8 fold increase beyond inflation.
  I suspect many of you could tell rumours of many many other cases which never get publicly reported. They are not isolated cases, they are how Scotland’s government works
 Every bridge; every new school; every pothole; every power line; every housing project; everything has an average of 7/8ths of the money unaccountable, not being spent on the necessary work. Billions, many billions of £s every year from the pockets of the people of Scotland. Our elected representatives, who are legally responsible, simply but resolutely refuse to discuss cui bono. Think what infrastructure we could afford if it only cost what it actually costs.

I did do another FoI asking the obvious question – why is there this 4% annual rise? The answer was “ it might be the rise in oil prices in the early 2000s”. The law that effect follows cause is more basic than anything even Newton discovered so it was clearly impossible that this could be in any way true for the 40 years before then and improbable afterwards since oil price rises affect the real world as much as the governmental one.

This motion has been deliberately left open to keep it simple and not tie the hands of UKIP elected representatives, when we get there but I hope when we do, and we will, we will be unrelenting in turning over all the rocks of government by the entire cartel of approved parties, and find what crawls out.
Neil Craig

     This is not entirely a Scottish problem but we do seem to be worse than average. London's Crossrail, which has not much more than 26 miles of tunnel is costed at 16 bn. Richard Rogers is on record as saying that of the £670 million the Millenium Dome cost only £46 million was spent building it. Our railways are far more expensive than continental ones because the infrastructure building and repair costs many times more. There are 2 possible explanations - incompetence and corruption. If there are more perhaps someone could say. Either way Parliament should be able to debate it and provide an answer. This is, historically, what they exist for.


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A useful comparitor is the Glendoe hydro electric scheme ( built privately by SSE )that came in at well below £200 million ( and the contractor is to repay the cost of boring the second tunnel to correct for the rock fall in the first that they had not lined)This project includes a dam over 900 metres long and over 30 metres high, 25kilometres of tunnels and a large generating hall bored out inside the mountain. It shows what can and should be acheivable in this country. It also makes the scale of misappropriation massive compared with the scandal of tapping the phones of some celebrities
Thanks I listed Glendoe on the links to my ThinkScotland article here (costed at about £120m then but such things change). I thought I had done more but apparently not.

You are quite right that the fact that that entire project could be done at that price shows we can do tunnels at app. Norwegian prices when those in charge wish.

Most of the Norwegian tunnels are unlined (& I think the more beautiful for it) however I can see that a tunnel full of water would be more in need of lining.

Send this piece to Tim Worstall and see if he can publish it as a guest piece. That way it will get the wider coverage and comment it deserves.
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