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WCML battles to close cost gap

RAILTRACK IS scaling down its West Coast Main Line modernisation programme after realising it cannot afford the level of improvements it had originally planned for the route.

Rail engineers now also fear that so much time has been spent rescoping the project it will be difficult for Railtrack to meet its summer 2002 deadline on the highly complex 2bn upgrade.

Problems emerged following delays in the award of the complex overhead power line renewal contracts. These were put out to tender at the start of this year but have still to be let.

'The prices received were so much at variance with Railtrack's original pricing that it is having to reassess what it wants,' explained a source from one contractor.

Railtrack, he said, has asked bidders to reassess their tender submissions and is discussing ways to bring down the cost. It is thought that the cost of the overhead line renewal work will end up somewhere between 150M and 300M - 'massively scaled down' from the original 400M cost.

Rail contractors insist that a similar process of cost reduction has been ordered across the whole of the West Coast Main Line modernisation project. Railtrack is also attempting to reorganise the procurement methods to incorporate more partnering within so-called 'alliance groups'.

A Railtrack spokeswoman confirmed the scope and schedule of each package on the project was under review and still had to be finalised. She added: 'Apart from the Euston remodelling which has already started, the only package to have been put out to tender is the overhead line contract for which Railtrack is reviewing three tenders at the moment.'

But Railtrack is committed to upgrading the route to 200km/h by the end of 2002 (Passenger Upgrade 1) and then to 225km/h by 2005 (Passenger Upgrade 2). Failure to meet these deadlines will leave Railtrack facing heavy financial penalties from train operator Virgin, which has a stake in financing the modernisation.

Contractors now question whether Railtrack is fully aware of the growing threat to meeting deadlines on the complex job. 'Carrying out business case analyses and studying contractual arrangements has taken a lot longer than expected,' said one contractor.

'Those at the top of Railtrack are making sure of a sound business case for every investment but that view is too basic,' he added. 'It is not linked to knowledge of the track. Upgrading work for Passenger Upgrade 1 is a major task. As well as highly complex technical and time issues there are difficult access problems. Time is now a key issue.'

The bulk of the design and build packages for the project are expected start going out to tender in spring next year. They include track, junction and cross-over renewal work as well as structural replacements. It could then take a further year before projects get to site, leaving contractors with very tight deadlines for technically and logistically complex work.

'It is very tight,' said one consultant. 'Resourcing is going to be a big issue, particularly where the contractor needs to get kit manufactured.'

Contractors also fear that delays will create resourcing problems as contracts start simultaneously. 'They have shot themselves in the foot,' said one. 'There is likely to be a bow wave of large contracts all competing for the same resources. And Railtrack still requires the rest of its network to be maintained.'

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