Decision details

Councillor O’Brien introduced the report seeking Cabinet approval of the Bentley Project Management sum of £423k, to cover the remaining Stage 2B period, and subsequent Stage 3 works, concluding the scheme’s Pre-Construction Period and highlighting that this is an important development site for both Bury and wider area.

Councillor Rydeheard queried the provisional maximum and whether any allowances have been made of if this would be exceeded and whether there is any room for manoeuvre.

Councillor O’Brien confirmed that we are not forecasting to exceed it.  If we do go over for any reason, would need to return to cabinet to make an additional decision.

Councillor Vernon queried paragraph 16 around Councils commercial risk and the included break clause and mechanisms.  If costs do spiral out of control are the developers liable as much as Bury Council. 

Councillor O’Brien advised that at this stage we can have a lot more certainty around the budget, however projects do get delayed and costs increase.  We are attempting to pre-empt this and can be reasonably assured that this a is a robust estimate and provide assurance that there are checks and balances in the approach. 

Decision(s)

Cabinet:

a.   Delegated final acceptance of Balfour Beatty Civil Engineering Ltd Stage 3 contract sum, up to a provisional maximum of £3,129,915, covering the finalisation of the Detailed Design/ Full Business Case stage work packages (Stage 3), to the Director of Law and Democratic Services in consultation with the Executive Director of Place and Director of Finance and the Leader.

b.   Approved the Bentley Project Management (UK) Limited contract sum of £423,000 covering the remaining Pre-Construction Stages of the scheme (finalisation of Stage 2b Outline Business Case/ Preliminary Design stage, and Stage 3 Full Business Case/ Detailed Design stage). 

c.    Accepted the remaining £8.5 million of Investment Zone capital grant funding allocated to the Western Access scheme, for inclusion in the Council’s Capital Programme.

Reasons for decision(s)

·         The Western Access scheme (Pilsworth Road Corridor Improvements) is a cross-boundary scheme with Rochdale Council, and will provide the necessary off-site, highway and transportation infrastructure required to access the early development phases of the Northern Gateway Investment Zone (IZ) site (JPA 1.1 allocation). The construction of the Western Access scheme will create the potential capacity to unlock up to 600,000 sqm of employment generating uses and support the creation of high quality, employment floor space, including space within the advanced manufacturing and foundational sectors. 

·         The completion of on-going Stage 2b activities to finalise the Outline Business Case (OBC) for the Western Access scheme will result in a preferred option for the scheme being identified and associated Preliminary Designs and an updated scheme budget estimate being prepared. Importantly, the OBC will also provide the robust strategic, economic, commercial and financial cases for the scheme. This in turn will provide the firm foundation for the development of the subsequent Stage 3 Full Business Case (FBC), which will confirm detailed designs and costings. 

·         Investment Zone (IZ) year one revenue grant funding was allocated to the Western Access scheme from 1st April 2024. Following Cabinet’s approval of the Grant Funding Agreement (GFA) in November 2024, the Year One grant (£800,000) has already been released. In September 2025, the GMCA and Council also signed a Deed of Variation to the original GFA that released the Year 2 revenue grant (£500,000) and an advanced payment of the Year 3 revenue grant (£200,000). The GFA covering the remaining £8.5M balance of IZ capital grant has also now been agreed between the Council and GMCA and provides sufficient budget to cover the remaining costs associated with the finalisation of the Western Access scheme Stage 2B activities (OBC/ Preliminary Designs) and the subsequent Stage 3 activities (FBC / Detailed Design) in line with the project cash flow. These costs include the Balfour Beatty Civil Engineering Ltd Stage 3 contract sum and the associated Bentley Project Management (UK) Limited contract sum covering their professional services during the remainder of Stage 2b and Stage 3. 

·         There continues to be an urgent need to swiftly and flexibly progress the development of the Western Access scheme to meet the challenging grant funding milestone deadlines which are attached to the release of the IZ grant. These GFA milestones include the finalisation of the Western Access scheme’s preliminary designs by early 2027, and production of the scheme detailed/ technical designs and costings during 2028. The approval of the Balfour Beatty Stage 3 provisional maximum, contract sum and external professional team (Bentley Project Management (UK) Limited) costs covering the remainder of Stage 2b and Stage 3, will help maintain scheme continuity and progress in line with GFA milestones and overall scheme programme. The continuation of these activities and services by the main contractor and the external professional team in line with their existing procurements and associated respective contracts, will also ensure the continued provision of the necessary resources and technical skills which the Council does not possess internally, to deliver these time critical remaining stages of the scheme’s pre-construction phase.  

·         The IZ funding has been allocated from 1st April 2024, with a revised spend output of summer 2030 in line with the Grant Funding Agreement scheme construction completion milestone, there is a need to move projects forward swiftly and flexibly to respond to these funding opportunities. The remaining balance of £8.5 million capital grant has now been made available to Bury Council and is required to be accepted for inclusion in the Council’s capital programme.

Alternative options considered and rejected

·         Delaying the approval of the Balfour Beatty Stage 3 provisional maximum, Contract Sum will in turn delay the finalisation of the Western Access scheme Full Business Case (FBC), and production of associated detailed/ technical designs and costings. Consequently, this will delay the start of the construction delivery (Stage 4), which under the grant funding requirements should commence by autumn 2028 and be completed by summer 2030. Noncompliance with funding requirements and associated GFA milestones would present a significant risk to the receipt of Investment Zone grant funding.

·         That the recommendations are not approved, and the Bentley Project Management (UK) Limited contract sum covering the finalisation of Stage 2b and Stage 3 is not approved. This would jeopardise the delivery of the Western Access scheme OBC, Preliminary Designs, FBC and Detailed Designs, which would impact on the delivery of the early phases of the Northern Gateway site development. The delivery of the Western Access scheme is critical to providing the necessary highway capacity and associated sustainable transportation improvements required to unlock the initial phases of Northern Gateway for a national-scale employment opportunity. 

·         Continuing with the existing contractual arrangements provides best value and maintains programme certainty. Re-procurement at this stage would result in significant delay, increased mobilisation costs, duplication of design and business case activities, loss of scheme knowledge and a substantial risk to achievement of Investment Zone funding milestones.

·         That the recommendations are not approved, and the remaining £8.5 million Investment Zone revenue grant funding is not fully utilised, with the funding being reallocated elsewhere in Greater Manchester. This presents a high risk to the delivery of the Places for Everyone joint development plan and specifically, the delivery of the Western Access scheme and the Northern Gateway Investment Zone (JPA1.1 allocation).

·         Delaying the delivery of the Western Access scheme would erode confidence in the Council’s ability to deliver a key strategic priority for both Bury Council and its strategic partners, including Rochdale Borough Council, Greater Manchester Combined Authority, Transport for Greater Manchester and National Highways. Delaying the delivery of the Western Access scheme would undermine supporting the delivery of a number of major, corporate strategies and Team Bury initiatives including the Council’s ‘Let’s Do It’ Vision and Strategy, Northern Gateway Strategic Development Vision, Atom Valley MDZ Vision and emergent Mayoral Development Corporation, Northern Gateway Development Framework (supplementary planning document), Bury’s Economic Strategy, the emergent Greater Manchester Transport Strategy, amongst others.