Tuesday, 13 April 2010

Tunnelling into Debt

In these stringent economic times, when the States are looking to make savings for all kinds of projects, it seems strange that the Waterfront plans are back on the agenda. Back in 2008, the proposition for the development noted that:

"The estimated long-term annual cost of maintaining and servicing the tunnel is £500,000 per annum. This cost consists of 2 main elements: (i) the cost of electricity to power lighting and ventilation; and (ii) the cost of maintaining the fabric of the tunnel (including maintenance and replacement of ventilation plant, lighting, signage, cleaning and maintaining the roadway). "(1)

The only States member who noted anything about this was Deputy G.C.L. Baudains, and he also came up with a somewhat worrying question about how this cost was going to be financed - by the general public by way of an increase in the Island rate:
"It does occur to me that perhaps some Ministers have difficulty differentiating between a liability and an asset in not counting for the £500,000 a year and rising cost to service the tunnel on top of future maintenance because I note in the report to the P.60 the Council suggested raising the Island-wide rate to meet this."(2)
The establishment of an Island Rate coincided with the establishment of the Income Support system, and it is not a general fund to be dipped into as an when departments decide they cannot balance their books, as another stealth tax.

Moreoever, these were the figures in 2008 for maintenance, and goodness knows how much they have risen since! What is certain is that costs are not fixed, and the maintenance costs will rise, year after year, and in a time when every department is being asked to make savings, to burden the future of the Island with this kind of rising cost seems incredibly shortsighted.

Thomas N Morrow of Jacobs Engineering UK Ltd, who is a  tunnelling and underground engineering specialist with 35 years experience notes that in even shorter road tunnels

"The operation and maintenance costs can still be significant - particularly the costs of power and lighting, ventilation, pumping and other safety systems. When looking at whole life costs of the asset then the tunnel operation and maintenance costs need to be factored in." (3)

The document entitled "Public consultation on the masterplan for St Helier Waterfront's Esplanade Quarter" which is a summary of the consultation remarks and considerations submitted was published on 16 April 2008. The word "ventillation" occurs once. There is not one single mention of the word "maintenance".

The only other useful piece of information comes in a question asked by Gerard Baudins: "With regard to the proposed sunken road at the Esplanade Quarter, would the Minister advise whether the annual maintenance and running cost of the fume extraction equipment is budgeted for within the suggested £500,000 annual spend, and would he further advise whether the fumes will be filtered before release into the atmosphere and, if so, the annual cost of so doing?"

And the reply, by Guy de Faye, was that "The estimated energy and routine maintenance costs for the tunnel ventilation plant are included in the suggested figure of £500,000 per annum for the total operating costs for the tunnel. There are no plans to filter the air exhausted from the tunnel. The pollution extract system will move the air through the tunnel prior to it being discharged at the tunnel portals. The air will not be filtered prior to discharge."

With the adjective "suggested" , the figure of £500,000 looks increasingly as if it was more or less plucked from thin air, or from the kind of calculations that are done in a pub quiz. I have not been able to find any documented breakdown of estimates of this "maintenance" anywhere, or any detailed plans of exactly what ventilation systems are to be used, and given that - such a suspiciously round figure as £500,000 looks remarkably false, and probably on the low side.

But the project is now back on the agenda, and could, according to Mr Izzat, the WEB Managing Director, start this year (7). While in the short term, the building work could boost the economy, in the long term, the cost of maintenance will grow, even allowing for no problems and hiccups on the way, which seems an extremely unlikely outcome for such a grandiose scheme.
I assume this is the same Stephen Izzat who was also responsible for Waterfront Edinburgh (6), and who is now on a £170,000 salary, by which comparison £500,000 probably does not seem an awfully large sum of money.

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