Decision details

The Corporate Director Resources, in consultation with the Assistant Chief Executive Legal and Democratic Services and the Executive Member for Finance

i) note the contractual position being experienced in delivery of the A59 Kex Gill highway diversion:

ii) approve release of additional urgent project funding of £2m in line with the delegation of the Executive meeting, 20 August 2024 from the Capital Supply Chain Reserve in order to agree contractual time-critical compensation event costs and contingency funding ahead of a further report being prepared for Executive on 13 May 2025 which will outline the full position.

The A59 project has been in delivery since February 2023 when Site Clearance commenced. While works have continued in terms of the construction, compensation events have arisen which increase the cost of the project. The key reasons being:

• a fundamental change in the design from a Piling to an Earthworks solution,
• the completion of watercourse design to meet environmental regulations and
• substantial areas of poor ground being encountered that cannot be incorporated into the finished works requiring export off site and conversely filling with suitable imported classification materials.

These issues mean that the current contingency is insufficient. To ensure the Council can pay Compensation Events in line with the contract approval is requested for additional interim funding of £2m, utilising the capital supply chain reserve, as approved by Executive on the 20 August 2024 ahead of a full report to Executive on 13 May 2025.

There is no ‘do nothing’ option as these costs are contractually due to the contractor. North Yorkshire Council are continuing to optimise technical design outputs and value engineering to keep additional costs to a minimum as this allows for the continued delivery of the scheme without additional costs outside of the extra construction cost currently being levied. Additional professional support is also being utilised as appropriate.