ThinkScotland is twenty years old – and we’re reviving some of our blasts from our past – this was first published on 10 August 2021
SOME TIME AGO I wrote an article here about applying the Norwegian tunnel building programme in Scotland. As a result of that I learned that in 2002 the Shetland Island Council had sought a quote from a Norwegian company for a tunnel to the northern island of Yell. Watching the decisionmaking is instructive.
The quote was £22 million, which the council then decided would be £35 million after it had included its oversight costs. It then decided that since this was slightly above the price claimed for a ferry they should go with that, though ferries obviously are not remotely as convenient or cheap to the customer as simply driving through a tunnel. After the decision was made it turned out there were a lot of unforeseen costs, like crews, and the ferry cost went up to £53 m (A) . Plus the fuel subsidy of £4-5 m a year.
Not the first nor last time cost promises have borne a very close relationship to what has been decided in advance and a very distant one to the actual costs. Having decided that we needed a bridge for a new Forth crossing and that it would cost £2,600m (though the last one cost £320m in today’s money) it would obviously have been inconvenient if it had been found a tunnel would be cheaper. Had it been costed according to Norway’s prices it would have an embarrassing £30m. Fortunately a civil service examination found it would cost £6,600m. When the will is there the error can be in the other direction – look at the promise the Olympics would cost £2,500m when unofficial estimates now put it at ten times that.
There is much to be said for offering a competitively tendered fixed price contract (like the Edinburgh trams) and letting them get on with it, rather than micromanaging large numbers of expensive changes (which would make it unlike the Edinburgh trams).
The question of tunnels and ferries in Shetland has come up again. A proposal for one or other to the island of Whalsay has been made. I weighed in on the online Shetland News saying that a series of 5 tunnels connecting the main island to Yell, Unst, Whalsay, Bressay and Fetlar would only run to about 16km underwater and cost £about £80 million. By comparison the 2 ferries to Yell and Whalsay alone would likely cost about £150 million and 20 years of subsidy of at least £160m more.
In my letter to the Shetland News I explained:
“Shetland Island Council are once again choosing ferries for both Whalsay and Yell rather than following the spectacularly successful tunnel programmes of Norway and the Faeroes….. being able to drive, for free, at any time, in a few minutes on roads with a virtually unlimited carrying capacity would obviously be far preferable to having to wait for slow, intermittent and expensive ferries.
When the issue of the first ferry came up the council received a quote for £22 million. This is realistic, indeed somewhat above the normal Norwegian costs. In some unexplained manner this metamorphosed into £35 million – possibly the extra £13 million is simply the cost of the council watching it be done. This just happened to be slightly above the price then given for a new ferry.
After the ferry contract was signed a whole range of necessary but unnoticed costs appeared. Between 2001/02 and 2004/05, the net costs of providing the ferry services rose from £6.9m to £12.2m, an increase of 77 per cent over three years. Over this period the principal cost increases were as follows:
Wages and salaries grew by 33 per cent to £6.687m;
Direct finance costs grew by 71 per cent to £1.846m;
Operating leases on new ships (SIC code 1209) increased from zero in 2001/02 to £1.5m in 2004/05.
The new Whalsay ferry is now priced at £53 million and again they have produced a tunnel cost slightly above that, but without bothering to get a firm quote this time….
The Norwegian tunnelling programme has been immensely successful, cutting tunnels at an average of under £5 million per km (under half the cost the council’s £53 million Whalsay estimate was based on). For example, the Laerdelstunnelen, at 24.5 km the world’s longest road tunnel, cost £119 million. This programme has been a significant factor in making Norway the 2nd richest sizeable country in the world (after Singapore).
By comparison total underwater distances between Mainland, Whalsay, Yell, Unst, Bressay and Fetlar are about 16km. I suspect that if asked to quote for the full range there would be economies of scale.
It is said that when there is a will to fail, difficulties can always be found, and this seems to have been shown when John Swinney assured Holyrood that a 3 km tunnel under the Forth, as an alternative to a bridge, would cost £6.6 billion, making it the most expensive in the world and 55 times more than the Laerdelstunnelen.
It is possible that there are some in Holyrood who have suggested to the SIC not to embarrass them with a tunnel success. This would explain the preference for the less effective and more expensive ferries.”
This and a little to and fro among writers resulted in a reply from a council official. This official had been one of two who in 2010 had told councillors a tunnel to Whalsay would be between £76 million and £83 million. At the same time it was claimed that, since Norwegian tunnels take twelve years to complete a Scottish one would need to be fifteen – though in fact they average much less than this, for example the Bomblafjord one took 39 months. Since then any decision has been hanging fire, though it was previously said a “once and for all” decision would be made in June 2010.
Interestingly in his reply he did not attempt to publicly dispute the Norwegian figures, mentioned above, though they are so much less. Instead he said “the council is still committed to the longer term aim of delivering a programme of fixed links” and “at the next meeting of the development committee in September, or the one after that …. the council will …. take a decision on the next stage of the fixed links strategy.”
“Fixed link” means tunnels. Nobody outside Holyrood claims bridges are cheaper. A decision is going to have to be taken – the current ferry is ageing, as are the piers. The example of Gourock/Dunoon where the car ferry was recently closed and a purely pedestrian one put in its place, would not be a serious choice for such an island. If there is indeed no dispute about the existence and costs of the Norwegian example we may yet see the first, but not the last, Scottish road tunnel using current technology being built on Shetland.
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Photo of Norðoyatunnilin in the Faroe Islands.
Shetland News letters http://www.shetnews.co.uk/letters/
Council employee gave high tunnel costs http://www.shetlandtimes.co.uk/2010/05/14/call-for-councillor-official-working-group-to-win-funding-for-whalsay-tunnel
Council decision day on Whalsay tunnel to be 30th june 2010, but may take 15 years to build http://www.shetlandtimes.co.uk/2010/05/19/further-work-to-be-done-on-whalsay-fixed-link-costs-as-decision-day-is-put-off-again
Reply from Council employee confirming committed to tunnels http://www.shetnews.co.uk/letters/5262-sics-committed-to-tunnels
Bomblafjord tunnel cut in 3 years http://en.wikipedia.org/wiki/B%C3%B8mlafjordtunnel
My previous ThinkScotland article on Scottish Tunnel Project https://www.thinkscotland.org/thinkpolitics/articles.html?read_full=11134&article=www.thinkscotland.org
