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The Jubilee River story - National Audit Office Examination of the Jubilee River Scheme
1. The NAO examination focused on three key aspects:
· The cost of constructing of the Jubilee River
· The independence of the Mechanisms of Flooding report
· Initiatives set out in the Lower Thames Strategy to reduce the risk of flooding downstream from the Jubilee River.
The Construction of the Jubilee River
2. The initial budget for the project was £73.4 million (at 1992 prices), which the Agency estimate is now equivalent to some £84.3 million once inflation and tax changes that occurred during the period are taken into account. The total project cost to date is £108.6 million, plus an estimated £6.3 million spent since the 2003 flood event (£3.8 million of this was spent on remedial works and £2.5 million on improvements to the capacity of the channel) to repair damage sustained during January 2003. The Agency recently received £2.75 million in an out of court settlement from Lewin Fryer and Partners in recompense for these repair costs. Following completion of the remedial work, the Jubilee River now operates at approximately 87 per cent of the original design capacity. The Agency told us that any further work to improve the capacity of the River will only be taken forward in conjunction with the implementation of the Lower Thames Strategy.
3. A key reason for the cost overruns was a lack of milestone checks in the Agency’s project management procedures. We found that the Agency has made significant changes to its project management procedures since the design and construction of the Maidenhead, Windsor and Eton Flood Alleviation scheme to address these shortcomings. In 2000, the Agency set up a specialist National Capital Programme Service to manage capital contracts with values over £250,000. The Agency has also developed an Agency Management System (AMS) to add rigour and formality to its project management processes. The AMS adopts the Office of Government Commerce Gateway process, which includes a review of the business case at all key stages in the project. Business case approvals now follow the requirements of Flood and Coastal Defence Project Appraisal Guidance, published by MAFF (now DEFRA) in 1999, which includes the need to carry out sensitivity tests to check the robustness of business cases, particularly where the scheme may have a marginal justification.
4. Notwithstanding the cost over-runs and the river not operating at the original design capacity, cost benefit analyses carried out by the Agency indicate that the scheme has provided a net benefit. The initial cost-benefit analysis of the scheme, carried out in 1992, suggested a cost benefit ratio of 1:1.2. A subsequent analysis carried out in 2006 indicated a cost benefit ratio of around 1:2. The increase in net benefits is due in part to a reduction in the discount rate issued by HM Treasury that is used to calculate the benefits of such schemes. The cost benefit analysis also reflects the latest modelling and flood risk information. The Mechanisms of Flooding report concluded that the operation of the Jubilee River had a negligible effect on the peak flood levels downriver of the scheme, and the Agency estimates that the operation of the scheme during January 2003 prevented flood damage of approximately £30 million.
The independence of the Mechanisms of Flooding report
5. In response to Mr Hammond’s concerns about the independence of reports on the flooding of January 2003, the NAO reviewed the appointment of Clive Onions as the chair of the three Flood Risk Action Groups (FRAGs,) and as the chair of the subgroup that wrote the Mechanisms of Flooding report on behalf of the FRAGs. Clive Onions, a senior civil engineer specialising in infrastructure, highways and water engineering, was appointed following a candidate search undertaken by the Environment Agency, and an interview process with representatives of the Environment Agency and the Royal Borough of Windsor and Maidenhead in attendance. The NAO found no evidence to suggest that Clive Onions was not sufficiently independent, although the Agency acknowledged that there was a shortage of suitable candidates as the size of the scheme meant a large number of contractors and consultants were already involved in some way.
The Lower Thames Strategy (LTS)
6. The NAO examined the measures under consideration by the Agency to alleviate flooding in the areas below the Maidenhead, Windsor and Eton Flood Alleviation scheme. The Agency commissioned the Lower Thames Strategy study in response to the floods of 2003 and has spent approximately £1.2 million to date on it. The study, which looks at long-term options for flood risk management in the area from Datchet (the bottom end of the Jubilee River) through to Teddington Lock, is currently in phase three, which seeks to examine in greater detail three options identified in phases one and two - channel reprofiling, such as lowering the bed of the Thames; creating flood diversion channels; and community based options, such as walls, banks, and individual property protection and flood proofing. Between September 2005 and March 2006, work has been underway to determine the acceptability of these options including:
· a series of environmentally led workshops to assess environmental impacts and opportunities;
· social surveys (designed by Flood Hazard Research Centre (FHRC) and undertaken by MORI) together with site visits to assess technical, social and environmental implications;
· a technical assessment of the hydraulic effectiveness, reduction in flood risk and economics of the options and
· internal and external consultations with statutory consultees including English Nature (now part of Natural England) and the Royal Society for the Protection of Birds, Local Authorities, service providers and landowners/private sector businesses, including those operating in the landfill sector.
expected to conclude in late 2006 and the results of this phase
will determine which options are viable and help identify which approach to
adopt that will best
reduce flood risk.
7. In the meantime, there are also a number of more general flood protection measures available to residents living on the flood plain of the River Thames. These include the Flood Line Warning Direct – an automated service giving warnings of forecasted flooding, intended to gives residents time to take appropriate action. Flood risk maps are now available through Local Planning Authorities and are included on the Environment Agency’s website. Members of the public who require detailed information on flood risk in a specific location can access them. The Thames Flood Forum, which includes representatives of local authorities, Council members, local interest groups and the Agency meets approximately every three months to discuss issues related to flood risk in the Thames area. More specifically, through its "Local Flood Parishes and Communities Together" (PACT) initiative launched in October 2003, the Agency provides advice to parishes and local communities developing flood action plans, which identify actions that will be taken in the event of flooding to minimise risk to both people and property. The Agency is also involved in the maintenance and replacement of existing flood defence structures.