TPA exposes £17bn of overruns on major government projects

Embargoed: 00:01 Monday 26th August

With the government announcing a review of HS2, a new report by the TaxPayers' Alliance analyses data on 10 UK major projects - covering everything from Astute submarines to Crossrail - which have collectively overrun by more than three decades and £17 billion.

These overruns equal £624 per UK household and could have paid for 7 out of the 10 projects at their initial costs estimates, with £4 billion leftover.

Government has a troubling record when it comes to major projects. Between 2013 and 2019 the number of major projects deemed at least "probable of a successful delivery" by the Infrastructure and Projects Authority has fallen from 48 per cent in 2013 to only 17 per cent in 2019. 

The report recommends that those responsible for long-term problems within major projects must be held accountable. The TPA are calling for senior decision makers and project managers to only receive bonuses depending on the success or failure of their projects.

 

Click here to read the research paper

 

Key findings

  • In an analysis of 10 recent and in-progress UK major government projects, overruns have grown to a total of 32.7 years and £17.2 billion, or £624 per UK household.
  • The £17.2 billion accumulated overrun could have paid for 7 of the 10 projects at their initial cost estimates, with £4 billion leftover.
  • Out of the 10 projects, the modernisation of the Great Western railway, Carrier Strike, and the Emergency Services Network programme incurred the most significant cost overruns at a combined £10.8 billion.
  • Both internationally and in the UK, major project forecasts have been shown to be consistently optimistic in terms of both cost and time to completion and almost always take longer and cost more than expected.
  • Multiple studies have suggested costs are intentionally underestimated to secure project approval, which means the potential for costs to overrun dramatically are greatly increased.
  • Those responsible for long-term problems within major projects must be held sufficiently accountable. Project managers must expect to be scrutinised over their failures whenever they occur, regardless of whether they have moved onto new roles. 
  • Senior decision makers and managers should receive bonus remuneration in a way that better reflects the pace of a project. For example, this could mean that any bonuses are paid out over time, contingent on the successful implementation of a project.

 

Click here to read the research paper

 

John O'Connell, chief executive of the TaxPayers' Alliance said: 

"Cost overruns and constant delays have become a depressingly familiar story on major government projects, costing taxpayers a fortune, harming productivity and blighting our ability to do big infrastructure.

"If Britain wants to be a leader on the post-Brexit world stage, ministers, civil servants and contractors must show that they can junk bad projects and deliver much-needed infrastructure on time and on budget.

The new government is in prime position to learn from past mistakes by holding project leaders to account - even if they've since left the public sector - and ensuring taxpayer-funded bonus payments reward success, not failure."

TPA spokesmen are available for live and pre-recorded broadcast interviews via 07795 084 113 (no texts)

Media contact:

James Roberts
Political Director, TaxPayers' Alliance
james.roberts@taxpayersalliance.com
24-hour media hotline: 07795 084 113 (no texts)

  1. Founded in 2004 by Matthew Elliott and Andrew Allum, and now with 80,000 supporters, the TaxPayers’ Alliance (TPA) fights to reform taxes, reduce spending and protect taxpayers. Find out more about the TaxPayers' Alliance at www.taxpayersalliance.com.
  2. TaxPayers' Alliance's advisory council.
  3. The TaxPayers' Alliance has previously analysed how the Government overspends on capital projects.
  4. We have recommended changes to the Crossrail 2 project which could cut costs and potential delays: Crossrail 2: can value for money be improved?
  5. The TaxPayers' Alliance believes that HS2 should be scrapped. We launched the Great British Transport Competition to find alternative transport infrastructure projects that deliver better value for money.