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Intelligent approach to costs

Bil McElroy

Accurate data on infrastructure is crucial, says Bill McElroy

Antony Oliver’s comment (NCE 31 May) stated that “infrastructure has landed on the government’s radar as key - perhaps even central - to the UK’s growth agenda.” He concluded by setting out his hope: “that properly funded and managed infrastructure will be the backbone not just of the nation’s economy but also of industry’s future prosperity”.

I fully support both statements and I firmly believe that to realise the latter point, we have to grasp the almost unique opportunity afforded by the government’s keen interest in infrastructure. It was this that led me to instantly accept Peter Hansford’s invitation to become deputy chair of the Infrastructure Data Group (IDG) and in doing so help to deliver the objectives set out in the Infrastructure UK (IUK) 2010 Cost Study report.

The IDG was set up as an ICE sub-group for the IUK Cost Study to improve the collection, maintenance, and use of infrastructure data - which would in turn improve the value for money obtained from the procurement, delivery and operation of infrastructure projects and programmes in the UK.

This clearly brings together the government’s clear desire to leverage infrastructure’s contribution to the UK’s growth agenda, while ensuring it is properly funded and managed.

The IUK Cost Study 2010 identified potential annual savings of 15% - £2bn to £3bn on current spend levels.

However, as Peter Hansford noted in his recent article on the IUK annual Cost Report 2012 (NCE 3 May), there are no single, simple measures to unlock these savings and all involved in the infrastructure sector need to play their part.

But one measure is unanimously agreed - decent cost intelligence is required if you want to pull together decent cost estimates (leading to delivery to time, cost and quality - and value for the taxpayer, user or customer).

However, the quality of cost intelligence is very varied across infrastructure sectors. The aim of the IDG is to help infrastructure clients realise the Holy Grail of decent cost intelligence and we are working on a number of related initiatives.

Recognising that greater value is realised by infrastructure clients learning from one another, the IDG has facilitated a Memorandum of Understanding between Network Rail, London Underground, the Highways Agency, and the Environment Agency. This allows these clients to draw on collective commercial intelligence and share their learning in an anonymised environment. The next phase, now underway, is to set up the group and get the learning disseminated. Following that the aim is to extend the group’s membership to other infrastructure client bodies.

Other current IDG initiatives include a BIM factsheet specifically focused on infrastructure clients, and the development of a means by which public sector infrastructure clients can satisfy the needs for cost transparency whilst generating data that will also be of value to subsequent infrastructure projects.

Bringing together industry, clients, academia and consultants, the IDG is rising to the challenge of ensuring that our future infrastructure provides the backbone of the nation’s economy whilst achieving proven value for money.

● Bill McElroy is deputy chair of the IUK Cost Study Infrastructure Data Group

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