M74 extension hit by new delay

SCOTLAND'S biggest road-building project has been hit by yet another delay amid fears costs may have soared.

Transport Scotland last night admitted the contract for the controversial five-mile M74 extension in Glasgow would be postponed for another month to deal with "issues" in the tendering process.

It is another setback for the scheme in what has been a protracted battle between the environmental lobby and the Scottish Government.

Only a week ago, The Scotsman revealed the European Commission had been asked to investigate claims ministers broke the rules over the contract.

The Greens claim ministers and the companies involved in the tender process broke two key European Union directives. They are focusing on the decision by four potential bidders to combine as one consortium to tender for the work, and the decision by ministers to unify two contracts into one – moves that the environmentalists believe were anti-competitive and against EU rules.

Negotiations between Transport Scotland and Interlink M74, the consortium of Balfour Beatty, Morgan Est, Morrison Construction and Sir Robert McAlpine, should have finished last April. The contract was finally due to be announced today. However, Transport Scotland issued a statement last night which said: "The M74 completion is a complex project and Transport Scotland had previously negotiated a one-month extension to the tender assessment period with the consortium to resolve various tender assessment issues."

Transport Scotland insists the project, due to be completed in 2010, will still cost between 350 million and 500 million – estimates which are more than four years old.

Even allowing for building cost inflation – currently as much as 6 per cent – the true price of the scheme could be between 473 million and 631 million. Experts said rising energy prices and demand created by the London 2012 Olympics could push costs higher.

A Green Party spokesman said: "We believe the process in which bidders were combined into one looks like an anti-competitive practice. This puts the future of the project in doubt."

The extension is designed to link the M74 to the M8, west of the Kingston Bridge in Glasgow. The project has been backed by business groups, local authorities in the area and the current Scottish Government – as well as previously being supported by the former Labour-Lib Dem coalition at Holyrood.

However, green campaigners have mounted a vociferous campaign against the extension, claiming it would cause serious damage to the environment.

Simon Storer, of the Construction Products Association, said: "Over recent years, a number of external factors will have changed in any major construction contract – particularly a rise in the cost of energy. It doesn't always mean the price will go up, because different materials could be chosen, but costs could change."

The other sides of the planned motorway "rectangle" around Glasgow were completed with the M8 and M73 in the 1970s. But a five-mile gap to the Kingston Bridge has remained since an initial extension of the M74 to Carmyle in the south-east was opened in 1994.

Plans to complete the scheme were lodged the following year despite campaign group Glasgow For People warning of "motorway madness" and Labour councillors being accused of ignoring the party's anti-motorway building policy.