M25 widening could have gone £1bn over budget

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The scheme to widen two stretches of the M25 around London could have gone over budget by as much as £1bn according to a group of MPs.

"We do not agree with the Highways Agency's view that the private finance contract to widen, operate and maintain the M25 represents value for money," said the Public Accounts Committee.

The group of MPs also slammed the Highways Agency for letting nine years pass between starting to consider congestion on the M25 and signing a contract with a private company for the job, saying that work could have been done cheaper before the credit crisis hit.

The criticism kept coming, with the Public Accounts Committee also saying that the £80m spent on consultants over a six year period was "excessive" and the Agency "lacks the capacity to assess whether its advisers are providing value for money."

The Highways Agency has reportedly said that the 30-year, £3.4bn private finance contract project is running on time and under budget so far though, although the Committee disagreed.

The Committee also felt that more options should have been considered, rather than just road widening. Labour MP Margaret Hodge, the committee's chairman, said: "The agency should not have focused just on widening but also have given proper consideration to a much cheaper alternative, hard shoulder running. A private finance project intended to transfer risk to the private sector should not have restricted innovation by ruling out this alternative solution."

Hard shoulder running has been used successfully on stretches of the M42 near Birmingham, and there are plans to introduce it elsewhere in the country as well.

Highways Agency chief executive Graham Dalton said: "We note the conclusions reached by the public accounts committee and will act on its recommendations.

"Meanwhile, widening of the M25 in Buckinghamshire, Hertfordshire and Essex is progressing to time and under budget and will be completed before the opening of the Olympic Games in summer 2012."