£15m Cost Savings For Highway Project

Costain has helped to deliver £15 million worth of cost savings for a major road project in Port Talbot through managing innovative client specific solutions and Value Engineering, which ensured the project went ahead and continued to receive funding from the Welsh Assembly.

The Early Contractor Involvement (ECI) phase of the Port Talbot Peripheral Distributor Road (PDR) Stage 2 project, between April 2009 and October 2010, led to £15 million of savings against the original tender.

This was delivered through having a dedicated team from Costain and the client, Neath Port Talbot County Borough Council, reviewing the scheme’s objectives.

Value Engineering involves developing the same or better product while using fewer resources. Some of the solutions included changing the carriageway foundations from piling to reinforced earth together with surcharge and settlement periods, and amending road layouts to reduce carriageway areas.


"Working with the client, we used a three-stage Value Engineering process which focused our efforts on ideas that were more likely to deliver value without compromising on quality," said Charlie Sleep, Planner for the scheme.

Mr Sleep said potential savings were initially brainstormed at a Project Team workshop. The second stage was to develop the ideas and come up with a budget cost and saving for each one within two weeks of the workshop. The third stage was to develop the selected ideas and outline the design before seeking stakeholder approval.

"The three-stage approach ensured that the amount of effort expended on an idea was proportional to the likely savings it would yield, and also that the appropriate level of stakeholder buy-in was achieved at each stage," said Mr Sleep.

"Throughout the process, we maintained a running total of the potential and achieved savings. This allowed us to determine which ideas were worth pursuing further at each stage of the process, whilst keeping a focus on the target savings required," he said.

The new proposals required the submission of a new planning application for the route in October 2010. The actual construction budget for the scheme was £84 million but this was eventually brought down to £69 million.

The savings also delivered improved economical cost benefit assessment results for the scheme, which helped inform the award of a European Convergence grant of £59million for the scheme. This is believed to be the largest European grant to Wales for a Highways scheme.

(CD/KMcA)