Balfour Beatty’s first half century is a tale of how politics and two world wars turned a company that started out with the intention of being operators and managers of electric infrastructure into a mainstream contractor.
George Balfour and Andrew Beatty formed the company on 12 January 1909 having met while working for an electric tramway business JG White. They saw that tramways which were generating their own electricity supplies for their trams were also the key to making local electricity supply viable for the whole population.
The plan was to provide financial and technical management to burgeoning undertakings and their first commission for £5,000 was to take over the operation of tramways at Dartford in Kent and Luton in Bedfordshire. It was a short step to extending a tramway in Dunfermline on a contract worth £141,450. However Balfour and Beatty did not divert from their original plan and stuck mainly to finance and management so that by 1912 they had set up the huge Midlands electricity supply group as well as a series of tramways.
War checks development
War in 1914 checked the development of electrical undertakings, staff left to join the army but contracting experience proved highly valuable. Balfour Beatty built army camps, including a vast one at Ripon, and was then called in to construct a 8km long pipeline aqueduct to bring water to boost hydro power to the British Aluminium Company’s works at Kinlochleven. It was a first step into heavy civil engineering.
In 1926, this was followed by a huge £2.5M commission to manage the construction of a scheme to supply hydro power to a new BAC development on Loch Linne at Fort William. Water had to be carried from Loch Treig to Loch Linnhe which involved driving a 24km long, 5m diameter hand drilled rock tunnel as well as laying 2m diameter pipes down the sides of Ben Nevis. Three thousand men were at work on what was known as the Lochaber water power scheme, which required 12 labour camps and a 30 mile private railway to supply the workforce.
At this point Balfour Beatty become even further involved in the development of Scottish hydropower. Back in 1922 the business had set up a very early private finance arm called Power Securities to fund power projects. The company helped Grampian Electricity Supply company raise money for hydro electric works to provide electricity to the Highlands.
While this was going on the company was also building its power holdings around the UK and was exploring overseas, supplying electricity to Jerusalem and Bethlehem, building tramways in Buenos Aires and most notably building the enormous Kut barrage irrigation scheme in Iraq to control the waters of the Tigris and Euphrates.
World War II curtailed everything. All activity was focused on the war effort. Balfour Beatty’s largest task was the astonishing Churchill Barriers − the 2.3km series of causeways between Orkney and Ronaldsay that closed off the vital strategic harbour of Scapa Flow to enemy attack. Gabions full of broken rock were dropped from overhead cableways into deep fast flowing water and then covered with 66,000, up to 10t locally cast concrete blocks. The firm also built two of the Mulberries for Mulberry Harbour.
After the war and into the 1950s politics seriously intervened in the Balfour Beatty business plan. The new Labour government nationalised the electricity industry and the company’s compensation was very slight as it owned very few assets of its own. All around the world political upheaval meant the business was having to retrench − from Palestine, from Iraq where there were revolutions, from South America following the coup that overthrew Juan Peron in 1955. Nationalisation of power supply in East Africa and Canada, where the company had interests, also affected Balfour Beatty’s growth.
The new strategy was to become a major contractor in power and civil engineering and Balfour Beatty started to build its success. Staythorpe B power station and the Berkeley nuclear power station on the Severn estuary were part of its construction portfolio and a jumping off point for the developments of the 1960s.