Balfour Beatty poised to lose control of Herefordshire highways
Balfour Beatty is set to lose control of highways maintenance in Herefordshire, with the county outlining plans to bring the work in-house.
The UK’s largest contractor won a £200m contract from the council in in 2013. The deal covers highways maintenance and improvement works, street lighting, public parks and open spaces.
But a new report, which will be discussed by the council’s cabinet on Thursday (2 March), reveals councillors’ concerns with the contract – which “does not meet” the council’s vision for the future.
The report says the the historic arrangement fails to provide the council with adequate levels of control and assurance for services that are delivered on the ground, adding that it may be “too friendly, with [a] lack of contractual control”.
Project work and design matters appear “over-engineered and overly complicated in some instances”, leading to concerns over value for money, the report adds. It also says that while Balfour Beatty generally delivers project work well, there are examples of more complex projects that have taken too long to complete.
An “option appraisal” carried out by the council found that its preferred delivery model – having in-house client and technical staff, with external providers topping up services – would provide the level of overview that the council seeks.
Cabinet member for infrastructure and transport John Harrington said the issue was the structure of the contract and whether Herefordshire had enough oversight expertise and technical services within its internal departments, having moved almost all these positions to Balfour Beatty a decade ago under a previous administration.
“Exploring the option of bringing technical and works management staff back in-house, as well as the inspectors, gives me more confidence that Herefordshire Council can manage the contract better and that we take back more responsibility (with the associated risk) and give clearer direction to Balfour Beatty Living Places to ensure we get best value for money and are able to give more direction to our partner,” he said.
Gemma Davies, cabinet member for commissioning, procurement and assets, said the council’s administration has been trying to increase scrutiny, accountability and best value from the contracts it procures.
“It is now more important than ever, with the cost-of-living crisis, that people rightly expect the council to be getting the most out of the contracts that are outsourced,” she said.
“This next step of the public realm contract journey will allow us to concentrate our efforts on those services that are best dealt with by an external provider and those that are better placed in-house with the council.”
A Balfour Beatty spokesperson said: “We continue to work closely alongside our partner, Herefordshire County Council, as they consider a variety of options for the future delivery of public realm services.”