Major Schemes Business Case Central Station Metro refurbishment

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Contents 1. Executive Summary ...... 3 1.1 Introduction ...... 3 1.2 Scheme Objectives ...... 3 1.3 Key Elements of Scheme ...... 4 1.4 Deliverability...... 4 2. The Strategic Case ...... 5 2.1 Introduction ...... 5 2.2 The Problem identified ...... 5 2.3 Nexus’ business strategy ...... 6 2.4 Drivers for change ...... 8 2.5 Options for development ...... 17 3. The Management Case ...... 23 3.1 Introduction ...... 23 3.2 Programme management ...... 24 3.3 Project Planning...... 26 3.4 Evidence of similar projects undertaken ...... 30 3.5 Evaluation ...... 33 3.6 Risk Management ...... 35 3.7 Communications and Stakeholder Management ...... 36 4. The Commercial Case ...... 42 4.1 Introduction ...... 42 4.2 Procurement Strategy ...... 42 4.3 Contract Management strategy ...... 43 4.4 Payment Mechanisms ...... 44 5 The Financial Case ...... 45 5.1 Introduction ...... 45 5.2 Project cost profile ...... 45 5.3 Contingency plan ...... 45 5.4 Revenue implications ...... 46 6 Economic case ...... 47 6.1 Introduction ...... 47 6.2 Scheme Options Appraised ...... 47 6.3 Modelling and Appraisal Approach ...... 48 6.4 Key Modelling Assumptions and Model Outputs ...... 51 6.5 Economic Appraisal ...... 53 6.6 Environmental Appraisal ...... 55 6.7 Social Appraisal...... 56 6.8 Scheme Costs...... 57 6.9 Public Accounts ...... 58 6.10 Headline Economic Impacts ...... 59 6.11 Sensitivity Tests ...... 61 6.12 Value for Money Statement ...... 62 6.13 Social and Distributional Impacts ...... 63 7 Appendices ...... 65 7.1 Central Metro Station refurbishment risk register, 10/06/15 ...... 65 7.2 Central Metro Station consultation feedback ...... 66 7.3 Central Metro Station construction costs breakdown ...... 69 7.4 Economic Case Appraisal Summary Table (AST) ...... 70 7.5 Nexus Project team CVs ...... 71

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1. Executive Summary

1.1 Introduction Nexus has identified a strategic opportunity to stimulate the economy of the area surrounding Central Station Metro and wider region, through the implementation of a scheme that will transform the station’s appearance, accessibility and functionality.

The Metro station is part of a key regional transport gateway. The mainline railway station here serves 8.025 million1 passenger journeys per year and the Metro station 5.02 million passengers (2.61 million boardings and 2.41 million alightings) per year. For many of these customers, the facilities, appearance and ambience of the stations will deliver an initial and abiding impression of the area and the climate of investment and innovation that it fosters. Around one-sixth of inbound airline passengers – approximately 400,000 people per year - use Metro to travel from Newcastle Airport to Newcastle city centre, and a large proportion of these interchange at Central Station with onward rail connections.

It is therefore vital that Central Station Metro projects a positive image to those that use it, complementing the comprehensive refurbishment of the adjoining Network Rail station and the major public realm investment which Newcastle City Council has achieved within the surrounding streetscape. Studies undertaken elsewhere confirm the positive impact of such a programme of improvements upon the economic prospects of the surrounding area. Sheffield and Manchester are two Northern cities where a co-ordinated programme of investment into gateway stations and their surroundings has resulted in a quantum change in the initial perceptions of visitors and has added quantifiable value to the local economy.

The proposals for Central Station Metro are about more than improving prospects for inward investment, important though they undoubtedly are. It also reflects the need to ensure that Newcastle is a welcoming, accessible, liveable city where people feel at ease, comfortable and looked-after, and where the use of sustainable travel modes becomes second nature. By facilitating reduced car use with resulting levels of congestion and pollution a virtuous circle of benefits will be created that strengthens the public transport network and empowers individuals to move freely and safely around the urban core. The upgrading of Central Station Metro will form an important link in this chain of events.

1.2 Scheme Objectives The over-arching objective of the scheme is therefore:

“To achieve a high quality refurbishment of a major Metro station to provide top class passenger experience at a key transport interchange hub, to support the Newcastle Gateway project and the wider economy of Newcastle, Tyne and Wear, and the North East Local Enterprise Partnership area.”

Delivering this will provide a station facility that;  makes the station more accessible and attractive to existing and future users, and

1 Estimates of Station Usage 2013/14. Office of Rail and Road 2015.

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 complements the wider streetscape and regeneration improvements within the area surrounding the Metro station.

Successfully achieved, this will lead to increased passenger throughput at the station, stimulate additional adjacent economic activity, and reduce the volume of trips made by car. 1.3 Key Elements of Scheme In order to achieve the objectives set out above, Nexus proposes to implement an extensive yet cost-effective proposal, which includes the complete replacement and modernisation of floor, ceiling and wall finishes, improved way-finding and information including new passenger information screens at platforms and concourse level. Accessibility improvements will be made throughout the station to increase passenger safety, and to help customers who may require additional facilities in order to be able to use the station easily.

Value management techniques have been employed to ensure that the scheme delivers lasting and tangible improvements that are commensurate with the effective use of public money. The overall station improvement scheme will be part-funded by Nexus using resources available through the wider Nexus Asset Renewal Programme for the Tyne and Wear Metro network.

Nexus seeks approval for funding of £2.51m of Major Scheme Funding from the Single Local Growth Fund to supplement the existing funding and allow a comprehensive refurbishment of Central Station Metro to take place.

The added value for which Major Schemes funding is sought lies in the higher standard of infrastructure provision and public realm improvements that will be provided. These will ensure that Central Station Metro projects the right image as part of a regional gateway, and is a modern, fit-for-purpose facility that positively encourages the use of Metro as part of an integrated transport journey both now and for years into the future.

1.4 Deliverability All of the assets that are included within the scheme are within the ownership of Nexus. Interfaces during the construction process between Nexus and Network Rail and Newcastle City Council assets will be managed through established liaison channels. Nexus has full internal project management capability and has a track record of delivering major engineering projects to time and budget.

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2. The Strategic Case

2.1 Introduction This strategic case provides the answers and the evidence surrounding two basic but fundamental questions that should underpin any business case:

 What is the identified problem?  How will the proposed measure address this problem?

This strategic case demonstrates the case for change with a clear rationale for making the investment, confirms the strategic fit, and sets out how this investment will further the aims and objectives of the North East Combined Authority, Nexus, Newcastle City Council and the Local Enterprise Partnership. More specifically, it specifies the business need for the development project, addressing the needs that will be met and identifies a series of investment aims, aligned to organisational and wider Government objectives.

2.2 The Problem identified Central Station Metro does not currently project the image or deliver the accessibility and functionality that it needs to, in order to provide a distinctive regional gateway to the city of Newcastle and the wider region. It is dated in appearance, in need of refurbishment and requires accessibility improvements to bring it up to the standards that present-day users expect and deserve. As a key transport hub for the wider region, the station simply does not currently provide a top class experience for passengers, nor does it provide a strategic fit with the Central Gateway project which is creating a new entrance to the city that is amongst the most impressive anywhere in the UK; consequently, the station does not fulfil its potential in supporting the wider economy of Newcastle, Tyne and Wear and the North East Combined Authority Local Enterprise Partnership area.

In 2010, Nexus received DfT approval for a £389m, 11 year asset renewal programme. Central Metro station is scheduled to undergo basic modernisation as part of this wider Asset Renewals Programme (ARP), but the budget allocated does not permit the implementation of a more radical refurbishment that will result in a more comprehensive transformation. Without additional investment, unfavourable comparisons with the standard of the refurbished Network Rail station above and the quality of the adjacent streetscape and new development will become increasingly apparent. It will also fail to meet the standards of accessibility and functionality that are becoming established across the public realm and which are an essential element of a sustainable transport network.

The risks of not fulfilling the potential of this scheme are centred on the potentially adverse impacts upon economic development, both in the immediate area and further afield. At a local level, negative perceptions held by regular users of the Metro station may affect patronage levels, which could feed through to increased car use for commuting trips. On a wider scale, the region has one chance to impress inbound visitors, many of whom use the Metro station as their entry portal en route from Newcastle International Airport or Newcastle Central Station. Without comprehensive updating delivered through a

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combination of Nexus and Major Scheme Funding, Central Metro station risks becoming the weakest link in the experiential chain of initial impressions of the area.

2.2.1 The proposal to address the problem identified Nexus seeks approval for funding of £2.51m of Major Scheme Funding from the Single Local Growth Fund to supplement the existing Nexus funding of £3.527m to allow a comprehensive refurbishment to take place.

The chosen scheme will address the problem identified by achieving a thorough modernisation of the station’s assets at a realistic cost, given current financial constraints. Details of the scheme are set out later in this document, but can be summarised as the refurbishment and renewal of flooring, surfacing, ceilings and lighting to deliver a major aesthetic uplift in a similar style to that employed at Haymarket, another city centre Metro hub. Additional way-finding materials within the station will combine with better signposting on the Network Rail station to increase visibility of Metro, improve integration and make the station easier and simpler to use.

Evidence that the proposed approach will deliver the required outcomes is provided by similar schemes elsewhere that have delivered improvements in job creation, property yields and public transport patronage through focused and co-ordinated investment in station facilities.

“Typically being the first impression of arriving in a locality, the station and its urban integration with the surrounding are of prime

importance and often act as catalysts for future development”.

Network Rail Station Design Guide 2015.

The end result of the scheme will be a fit-for-purpose asset which makes a strong statement about Metro in its own right, in addition to supporting the composite impact of surrounding investments in public transport and streetscape which cement the impression of this area of Newcastle as a positive place in which to live, work, relax and invest. The project will deliver a high quality refurbishment of a major Metro station to provide top class passenger experience at a key transport interchange hub, to support the Newcastle Gateway project and the wider economy of Newcastle, Tyne and Wear and the North East Local Enterprise Partnership area.

2.3 Nexus’ business strategy Nexus is the operating name of the Tyne and Wear Passenger Transport Executive. It is responsible for delivering public transport policies in the Tyne and Wear area that have been set by the North East Combined Authority.

The strategic aims of the organisation are to create the conditions whereby people will increasingly choose to use public transport. Nexus provides, plans and promotes public transport to improve the economic prosperity of Tyne and Wear and the daily lives of its

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people. Nexus also looks to the future, creating the travel networks people will want to use in decades to come. The four key objectives of Nexus are focused on connecting communities, changing the way people travel, supporting economic regeneration and tackling climate change.

2.3.1 Tyne and Wear Metro and Central Metro Station Nexus owns, manages and maintains the Tyne and Wear Metro system. The Metro is the UK's busiest light rail system outside London. It carries around 38 million passengers a year, and is the backbone of the area’s public transport network. The system is owned and managed by Nexus, and has 60 stations with peak time trains running up to every three minutes in the central Newcastle to Gateshead corridor.

Metro has led the way in innovation - as the UK’s first modern light rail service, the first to be designed with disabled people in mind, the first to be non-smoking and the first to provide mobile phone and internet reception throughout its underground sections. Since opening in 1980 it has been extended to Newcastle Airport (in 1991), providing a 20 minute link to the city centre and through Sunderland city centre to South Hylton (in 2002). Nexus has exciting plans for the future of Metro which include the introduction of a new train fleet and potential network extensions (Nexus 2030 draft Metro Strategy). As an example, Nexus is currently examining the feasibility of extending Metro to and from the new International Advanced Manufacturing Park in the Washington area, alongside other modes of public transport.

Central Station Metro station is located in the heart of Newcastle and is a key transport interchange between Metro and heavy rail, as well as providing connections to local bus services for the region and to nearby coach services.

The Metro station comprises two underground platforms and a below-street ticket concourse. The platforms and concourse are linked to ground level by lifts, escalators and stairs. There are three entrances to the station: two onto street and one a direct linkage into the Network Rail Central Station concourse.

In terms of footfall, the Metro station is the third busiest station on the system with over 5 million journeys per annum starting or ending at the station2. Almost a quarter of those journeys incorporate an interchange either to or from another mode of public transport. The majority of station users, some 46%, are commuting to work, whilst 31% are travelling for shopping and leisure purposes and 10% for education3. Newcastle and Gateshead support 187,000 and 96,000 jobs respectively4.

The Metro station provides access to key strategic employment areas from the wider region. As well as direct access to Newcastle City Centre from Sunderland, South Tyneside and Gateshead, and other areas of Newcastle and North Tyneside, interchange is provided to a wide range of destinations in around 30 minutes by public transport. These include:

2 Nexus Business Intelligence, 2014 3 Nexus Business Intelligence, 2014 4 Nomis Official labour market statistics, Office for National Statistics, 2010

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 Metro Centre in 11 minutes  Newcastle Business Park in 7 minutes  Newcastle Airport in 25 minutes  Team Valley in 14 minutes  Tyne Dock in 23 minutes  International Ferry terminal in 20 minutes

Consequently, Central Station is rightly identified as a key regional gateway within the Strategic Economic Plan drawn up by the Local Enterprise Partnership5.

2.3.2 Scheme Objective Central Station Metro is little changed from the original 1970’s design, and requires regeneration. Nexus intends to upgrade and refurbish the station to a high standard to ensure that the facility plays its full part in increasing the attractiveness of this area of the city to inward investment. The station is a major city centre access point to the Metro network, as well as a regional public transport gateway in a wider sense, in combination with the adjacent main-line railway station.

The primary objective of this scheme is therefore:

“To achieve a high quality refurbishment of a major Metro station to provide top class passenger experience at a key transport interchange hub, to support the Newcastle Central Gateway project and the wider economy of Newcastle, Tyne and Wear and the North East Local Enterprise Partnership area.”

Effectively delivering the project will make the station more accessible and attractive to existing and future users and complements the wider streetscape and regeneration improvements within the area surrounding the station. Successfully achieved, this can lead to increased passenger throughput at the station, stimulate adjacent economic activity and reduce the volume of trips made by car. As such, this project vision clearly supports the four key objectives of Nexus, as well as supporting Tyne and Wear Local Transport Plan (LTP) objectives and the Newcastle Council Strategic Gateway vision.

2.4 Drivers for change The two primary drivers for change for this proposal were defined from the initial problem identified and have formed the overall objective for the scheme. This section will provide evidence as to why addressing these key drivers for change can be expected to deliver the overarching objective.

2.4.1 To provide a top class passenger experience The Metro station is maintained in a safe and serviceable condition but is essentially unaltered since it was built in the late-1970s - since when passengers’ expectations have risen considerably. When Metro commenced operations in the 1980s, the trains and the network were ground-breaking in terms of UK light rail operations. All aspects of Metro

5 More and Better Jobs. Draft North East Strategic Economic Plan. December 2013.

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were state of the art and set the standard for others to follow, from the trains to the stations to the ticket machines and the standard of information provision. The challenge for Nexus three decades on is to keep it that way. As former Minister of State for Transport Norman Baker MP said:

“A good quality railway journey starts the moment you enter a station, not just when you step onto a train”6

Nexus has already invested in the Metro station as part of the wider ARP with the installation of a new ticketing gate-line and replacement of the ticket machines. The two main escalators from the concourse to the platforms have also been replaced with modern, more energy efficient and accessibility compliant ones. However, surrounding public realm works and improvements to retail centres have transformed areas of the city during recent years, with destinations such as Eldon Square being regularly refreshed and upgraded to maintain and enhance their place in the retail offer. The contrast between Central Station Metro and recent refurbishments such as Haymarket Metro and the ongoing Network Rail revitalisation of the main line station, situated directly above, is increasingly apparent. Refurbishment of the Grade 1 listed Central Station portico on Neville Street and the comprehensive upgrading of the adjacent streetscape have raised the bar in terms of public realm excellence across the area surrounding the Metro station.

Research by Passenger Focus, to assess user views following the Network Rail National Station Improvement Programme, found that more than 70 per cent of passengers said that the overall look and feel of a station had noticeably improved following works. Supporting this, the January 2013 Passenger Focus (Heavy Rail) National Passenger Survey found that following significant investment, passenger satisfaction with King’s Cross and Waterloo Station increased by 32 and 11 percentage points respectively7.

Anthony Smith, Transport Focus Chief Executive, has said:

“Our research clearly shows that passenger satisfaction with stations increases when the money invested in improvements is targeted at the things that matter most to passengers.” 8

Further afield, research undertaken into the impacts of station improvements elsewhere underlines the positive contribution they can make towards their surroundings. Netherlands Railways9 has conducted research into the effect of station improvement measures on customer satisfaction based on environmental psychology methods. The study concluded that station atmosphere has the greatest impact on the general evaluation of a station.

6 Passengers to benefit from investment at Horsham station, November 22nd 2012, Network Rail 7 The Value of station Investments, SDG, 2011 8 http://www.passengerfocus.org.uk/news/articles/passengers-give-station-improvements-the-thumbs-up 9 Public Transport in the Netherlands. European Metropolitan Transport Association 2010

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Nexus has seen similar improvements in passenger experience at Metro stations refurbished recently. Chart 1 shows the clear increase in overall passenger satisfaction at Haymarket station, relative to other stations across the system10

Chart 1: Overall passenger satisfaction at Haymarket, Central and other city centre stations, indexed at 2008/09

A similar station refurbishment scheme was completed in 2010 at Sunderland Station below ground, where the station platform environment, which in this instance serves mainline and Metro services, was revamped at a cost of £9m. This station witnessed a dramatic increase in customer satisfaction with the station. Satisfaction with infrastructure increased from 61% to 89%, and with station condition and lighting from 48% to 83%. Additionally, although patronage for public transport as a whole did decline in the months following the station refurbishment, mainly due to the effects of the economic downturn, Sunderland Station saw a far lower rate of decline in patronage than both adjacent stations and the network average.

Nexus research supports this trend, finding an increase in passenger satisfaction at Haymarket station with regards to general cleanliness of the station, increasing from 67% of passengers satisfied in 2009, to around 95% from 2010 to date. To put this in context, satisfaction at other Newcastle City Centre stations has been fairly consistent at around 80%. Nexus also found that passenger perceptions with lighting at Haymarket station increased from a base below other stations across the system to be consistently higher. Satisfaction with regard to station equipment, including lighting, increased at Haymarket, from 72% of passengers satisfied in 2009, to around 95% from 2010 to date, compared with around 85% across other city centre stations. Satisfaction with regard to information provision increased at Haymarket, from 83% of passengers satisfied in 2009, to around 90% from 2010 to date: satisfaction at other Newcastle City Centre stations has been fairly consistent at around 87%. Finally, in the context of personal safety, Nexus has subsequently observed an increase in passengers’ feelings of safety at Haymarket following refurbishment. Passenger perceptions of safety and security here have increased to an average of 93% satisfaction since the refurbishment, from 75% in 2008. This is in contrast to other stations which have shown incremental improvement from a base of 83% of people who were satisfied.

10 Nexus Business Intelligence, 2014

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A new guide published by Network Rail provides insight into best practice principles for station design on the national rail network11. It majors on the following key principles that should be pursued regardless of station location:

 Safe  Accessible  Inclusive  Delightful  Sustainable

The guide also explains the principles of a ‘pyramid of customer needs12’, highlighting the factors that generate customer satisfaction and dissatisfaction. An understanding of these needs when designing or improving stations has been shown to increase customer satisfaction and to generate more positive emotional reactions in potentially stressful environments. The concept hypothesises that customers need to experience elements from each of the red, amber and green elements of the pyramid in order to enjoy a positive travelling experience.

Chart 2: Pyramid of customer needs 12

Research for DfT also showed that improvements to stations helped to improve passenger perceptions of safety and security as well as station usage, especially where improvements

11 Station Design Principles for Network Rail. Network Rail 2015. 12 Extracted from ’The 10 Commandments of How to Become a Customer Driven Railway Operator. Van Hagen and de Bruyn, Netherlands Railways 2012.

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to lighting and entrances were made13. There is further evidence that suggests high quality station environments reduce crime and increase footfall; specifically that wayfinding and access highly influence passenger perception14.

Other Nexus initiatives, such as smart ticketing, the provision of real time train running information and Metro fleet refurbishments, which have also resulted in increases in customer satisfaction, are designed to keep pace with increasing expectations of what public transport should provide to the end-user. For example, Nexus has invested around £20m to install new Ticket Vending Machines at all stations across the network. The shell of the machines had not been upgraded since the Metro opened and were originally designed to sell tickets for cash in denominations as little as 2p. The contrast with the new functionality, including a touch screen facility and importantly the ability to pay with cash, notes or cards, has resulted in passenger satisfaction with regards to facilities for buying tickets at stations increasing to 87%, from an average of 76% between 2008 and 2012. Further to this, the new machines offer a wider range of tickets to passengers, including the ability to purchase period products on smart cards. Again, passenger satisfaction with regards to the range of tickets available has increased from 77% between 2008 and 2012 to 85% in 2013. These examples of changes in technology highlight the changes in passenger expectations since the opening of the Metro in the 1980s15.

All of the above evidence highlights the opportunity to provide passengers with a top class experience through developing the station refurbishment scheme to its full potential.

2.4.2 Strategic alignment with Newcastle Central Gateway project and supporting economic growth The North East Local Enterprise Partnership Strategic Economic Plan includes a priority action of investment in regional public transport infrastructure, including key transport interchanges such as Central Station, recognising its role as a key regional gateway. The NewcastleGateshead One Core Strategy identifies Newcastle Central Station as a major international arrival point and prioritises onward travel from the station for investment. Two Newcastle City Council major projects, under the umbrella of Newcastle Central Gateway, have recently received funding to improve the station and the area surrounding it. Newcastle’s Central Gateway project aims to;

“stimulate private sector growth by significantly improving access and legibility to key city centre locations. These include existing services and retail (safeguarding jobs) and proposed future development (supporting the creation of jobs).”

Nexus believes it is imperative that the Metro station aligns with this and plays a key role in this wider project to improve the Gateway area. We believe the refurbishment of the Metro station, being integrated into the mainline station and a significant part of the transport interchange, is important to build on and not diminish, the benefits derived from these other projects. The entire area of the main rail station concourse and the adjacent

13 Passengers’ Perceptions of Personal Security on Public Transport -Qualitative Research Report INDEPENDENT SOCIAL RESEARCH for DfT, April 2009 14 The Value of station Investments, SDG, 2011 15 Nexus Business Intelligence, 2014

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streetscape has been transformed upon the completion of this programme of works. It is vital that the appearance and facilities associated with Central Station Metro do not detract from this programme’s impact in terms of strengthening a regional gateway, and its role in job creation in this area of the city. Whilst the subject of this bid is aligned to the Central Gateway project, rather than directly connected, the Metro station will nevertheless be perceived as such by many of the people who use it.

Investment in stations has also been seen as a catalyst for wider regeneration in the surrounding area, resulting in a virtuous circle of increased levels of economic activity, providing further stimulus to employment and incomes. At both Manchester Piccadilly and Sheffield there has been evidence of a ‘ripple effect’, whereby initial development prompted partly by station improvements increased investor confidence and encouraged further development across the city16. As such, other Central Gateway project aims will also be supported by Central Metro station development - for example, to stimulate and support economic growth across the wider functional economic area, through improved transport linkages helping to ensure that all those living in the surrounding area are able to benefit. This will help to improve Newcastle’s competitiveness by supporting private sector growth in the city centre, stimulating the office market, the city’s retail and tourism offer and the growing evening economy. This, in turn, will benefit the burgeoning Conference and Hotel industry in the Newcastle and Gateshead urban core.

Evidence of improved stakeholder perceptions is contained in a recent study into the impacts of city centre station investment17 which concludes that positive user perceptions can translate into higher levels of economic activity and inward investment within surrounding areas. Network Rail undertakes a substantial programme of station investment and refurbishment to maintain its asset base, improve accessibility and safety, and stimulate retail activity. Its Guide to Station Planning and Design18 explains why this is necessary. The foreword states:

“Done well, their design and operation helps to facilitate the success of the national rail network. A successful railway station will add to the passenger experience as well as support the economic, social and environmental benefits of rail. Their effective integration with other modes of transport and the surrounding area can provide for an end-to-end journey experience that makes sustainable transport a real alternative to private vehicle usage”19

These conclusions are supported by the findings of the SDG report into the value of station investment which demonstrated that a poor station environment can discourage investment in the surrounding area and that conversely, targeted investment can generate substantial GVA benefits. Additionally, conventional transport benefits from the

16 The value of station investment, SDG, 2011 17 Ibid 18 Guide to Station Planning and Design. Network Rail 2011 19 Mike Goggin, Director, Stations and Customer Services, Network Rail

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improvement scheme at Sheffield station20, principally time savings and additional station footfall derived from the original business case, translated into increases in GVA.

The wider area’s economic transition to sustainable private sector employment will be helped by improving their accessibility and thus indirectly supporting the formation of 8,225 jobs at key development sites within Newcastle. A significant proportion of these jobs will be secured by residents of one of the more economically deprived regions of the UK – GVA per employee in the North East in 2012 at £36,900 was 30% below the England average. Access to a number of City Centre development sites will also be improved, including the development in the Stephenson Quarter, and links provided to developments in East Pilgrim Street and at Science Central.

South of the station major development is taking place in the Stephenson Quarter, where former warehouses and factories are being sympathetically modernised in a £200m project alongside striking new development. Development of the Stephenson Quarter is in accordance with the NewcastleGateshead Urban Core Area Action Plan. Over 300,000 square feet of office space, a premium hotel - a new Crowne Plaza opening in July 2015 featuring 250 bedrooms and a state of the art conferencing centre for up to 400 guests - and new residential and retail space are contained within the site masterplan. Over two thousand new jobs will be provided upon completion of the development, all located within walking distance of Central Station.

Chart 3 shows that since Haymarket Station was refurbished in 2009, its boardings have overtaken Central Station, and Haymarket became the second most-used station on the Metro system, with boardings growth of 9.5% in the first year. This is in contrast to network- wide patronage trends, and the performance of adjacent city centre stations.

Chart 3: Rolling annual patronage at Haymarket, other city centre stations and the rest of the Network (Indexed at Sept 2009)

20 Sheffield Station Upgrade, Network Rail and Sheffield City Council.

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Work undertaken for the Metro Asset Renewal Plan business case, accepted in full by the Department for Transport, suggested that regeneration of a station would increase patronage by an average of 2.7%. When applied to Central Station this would increase journeys by more than over 70,000 each year. This will increase travel by sustainable means to the key growth sites in Newcastle City Centre which also have health benefits, which are subsequently proven to have a knock-on effect on productivity21. The Newcastle Gateway project also cites reducing congestion as leading to improved productivity across all business sectors as well as improving the productivity of Newcastle Central Station itself. Traffic congestion and poor connectivity to key employment sites have acted as a deterrent to business growth and investment and act as a barrier to the wider benefits that a sustainable and integrated transport network has on the economy. Reflecting this, the North East Chamber of Commerce’s NewcastleGateshead committee have pressed for improvements to the Central Station.22

Additionally, high quality public space has been shown to reduce employee absenteeism and staff turnover as well as improving overall productivity.23 A study carried out by the American Journal of Preventative Medicine also found that using Public Transport could improve health and lower obesity levels24.

The British Medical Association similarly reported that active travel improves mental health, reduces the risk of premature death, prevents the onset of chronic diseases and that combining active travel with public transport helped people achieve their recommended daily physical activity levels25. The human impacts of physical inactivity, poor air quality and noise cost the Government up to £25bn per annum26. The Central Gateway project will enable and facilitate wider changes in Newcastle to promote these benefits27.

Additionally as part of the Central Gateway Project, improvements to be made along Neville Street (the street immediately outside the station) and in the surrounding public realm will improve perceptions of safety for pedestrians choosing to use public transport in the area, further supporting modal shift. Improvements to onward travel connections – for example upgraded bus stops and shelters adjacent to the station portico and the improved layout of the main-line station concourse – should also help to foster a sense of proper integration between the various modes of transport in this area. Although there are around 2 million bus journeys made from the surrounding area each year, Nexus Research suggests that the proportion of people using the Metro as part of an interchange journey has reduced consistently in recent years, from 20% in 2008 to 18.4% in early 2014.

A key feature of the preferred option for redevelopment of Central Metro station is the improvement in customer accessibility that it will provide between the main line and Metro station concourses. The existing escalator from the Metro concourse to the Network Rail

21 Marmot Review, Strategic Review of Health Inequalities in England post 2010 22 Newcastle Gateway, Regional Growth Fund bid, 2011 23 CABE and DETR, The Value of Urban Design, 2001 24 American Journal of Preventative Medicine, August 2010 25 BMA, Improving and Protecting Health, July 2012 26 Cabinet Office Strategy Unit et al, 2009 27 Newcastle Gateway, Regional Growth Fund bid, 2011

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platforms will be renewed, and the existing adjacent stairs will also be resurfaced and double handrails introduced, consistent with other staircases on the station. Sub-optimal access to Central Station, compounded with opaque wayfinding from areas of the Network Rail station may have encouraged use of taxis, or cars for the whole journey, when an improvement to a key link in the accessibility chain could improve Metro uptake. From a regional as well as local point of view, taking account of the station’s role as a regional gateway for both rail and air passengers, it is seen as essential that any such practical or perceptual barriers to personal mobility are removed.

Nexus research has shown that passengers travelling with luggage, prams, shopping or other similar items are far more satisfied at Haymarket station, consistently scoring 8.5 out of ten overall, compared to all other stations where the score is 7.9 out of ten. Additionally, the proportion of passengers citing a disability during passenger satisfaction surveys has increased at Haymarket since 2009, whereas the proportion interviewed system wide has fallen, emphasising the improvements in accessibility at Haymarket since its redevelopment28.

Investment in Central Station Metro as proposed in this bid can be further justified by ensuring that Metro continues to play an increasing role in the wider economic development and regeneration of Newcastle upon Tyne. Supporting rail growth is a key component of the Government’s approach to delivering economic growth29. Newcastle Central mainline station sees 8 million passenger boardings per year and is on the key East Coast Main Line30. In addition to East Coast services to London and Scotland, train operating companies also provide Cross Country and Transpennine services to Leeds, Sheffield, Birmingham, Liverpool and Manchester as well as more local Northern Rail services to destinations in the North East region and Cumbria. The project will reconnect Newcastle Central Station to the city centre, strengthening Newcastle’s status as a sustainable city (ranked 1st in the UK in 2009 and 2010)31, through improved accessibility.

Phil Verster, then managing director for London North Eastern for Network Rail, said of the main line station refurbishment:

“Newcastle station is an incredibly busy and important transport hub for the north east. These improvements will help passengers to get the best from the listed building. Significantly, the finished station will also give a better first impression to visitors to the city.” 32

As a major Tyne and Wear Transport Hub, Central Metro station facilitates travel to a number of local education sites. Newcastle College is located within walking distance from the station, and is also served by bus links which connect from highway directly adjacent to the station providing good, easy interchange: only 10% of students at the Rye Hill Campus arrive by car, highlighting the importance of high quality public transport connections.

28 Nexus Business Intelligence, 2014 29 Newcastle Gateway, Regional Growth Fund bid, 2011 30 ORR Station Usage statistics, 2013/14 31 Sustainable Cities Index, Forum for the Future 32 Newcastle Central station to benefit from £8.6m investment, November 2011, Network Rail

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Gateshead College and the region’s Universities are also easily accessible with connections from Central Metro station, via bus, onward travel on Metro or heavy rail.

10% of the users of Central Metro are travelling for education purposes, which equates to around 270,000 journeys a year, and Metro offers discounted products in the form of a 16- 18 Metrosaver for this age group and a Metro Student card for university students. Network One (the multi modal ticket provider for Tyne & Wear) also offers a student product which facilitates onward travel at a discount compared to standard prices.

Facilitating travel for education purposes by sustainable modes of transport helps reduce congestion and demand for parking in Newcastle City Centre. Redeveloping the station, which acts as a key transport hub for many educational sites as well as providing interchange with other modes of transport, will help encourage modal shift. New student accommodation which opened at Trinity Square near Gateshead Metro in 2013 has further increased demand for interchange through Central Station.

This also supports the Newcastle Central Gateway project by providing much-needed improved linkages to Newcastle College, as it expands to accommodate 30,000 students and improving an important gateway for the 52,000 national and international students at the city’s two universities.

2.5 Options for development Asset condition deteriorates with time and although the station is always maintained in a safe and fit-for-purpose condition, the general appearance and functionality of the premises falls below Nexus’ current desired standards. Nexus’ Asset Renewal Programme is ensuring the maintenance of all network assets to an effective standard that will continue safe operation but the level of existing grant made available does not cover the upgrading of all stations to an optimum standard. In order to ensure that the funding provided to deliver the ARP by Central Government and local sources is efficiently utilised, and that Nexus properly prioritises the ARP investment plan, it is necessary to properly identify appropriate investment criteria of safety, performance, condition and criticality. Criteria that assisted in determining scope development included legislative compliance, IEEE regulations, accessibility legislation33, passenger perception, general ambience, passenger security, structural integrity, access for disabled people and those with mobility impairments and architectural finishes for platforms and ceilings.

A Value Management workshop was conducted in September 2013 to identify where value can be obtained from the scheme, both in the immediate capital and long-term revenue perspectives. The Value Management workshop yielded some interesting discussions and ideas, and it was determined that the key steer for this project is to improve accessibility and the legacy feel and appearance of the station.

There will be no large-scale physical changes to the footprint of the station or to its operations. However, there is a need for more comprehensive upgrading than can be afforded under this programme, particularly in terms of station redevelopment, to resolve

33 Equality Act, 2010

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the problems identified and meet the objectives. Nexus has been required to seek out alternative funding sources for those locations, such as Haymarket and Sunderland in the recent past and Central Station now, where a distinctively different scale of intervention is required to meet both customer expectations and the surrounding sense of place.

Three potential options have been considered for Central Metro station:

 Do Nothing - maintain safety and facilities but with no improvements  Basic refurbishment - achieved with existing funding, a repainting and cleaning of existing finishes  Full scheme refurbishment – achieved with existing Nexus funding and additional £2.51m Single Local Growth Funding providing a high class, longer lasting finish covering most of the station and improvements to accessibility

2.5.1 Do nothing To do nothing at Central Metro station will not address the problem identified in this case, nor will it achieve the key objective.

Additionally, to do nothing risks diminishing the impact of the wider Central Station regeneration scheme for the reasons described earlier. The main-line railway station and the surrounding streetscape have undergone a transformation that risks putting Central Station Metro in a negative light that could undermine both its own performance and that of the wider area in which is located.

If the scheme does not go ahead, the standard of customer facilities at Central Station Metro will continue to fall behind the future expectations of customers, risking reduced use of the station and a potential threat to the sustainability of the regeneration of the wider area of the city. Not progressing the project would also affect public perceptions of Metro and first impressions of the region, as viewed by customers using the station en route to or from Newcastle International Airport or other key destinations. The current sub-optimal appearance of the link between the main line and Metro station concourses reduces the level of interchange by passengers. This may encourage use of taxis, or cars for the whole journey, when an improvement to a key link in the whole-journey accessibility chain could improve Metro uptake. Perhaps most importantly, following development of the Newcastle Central Gateway Project, this would further emphasise the unfavourable comparison between the Metro station and the standard of the surrounding extensively refurbished public realm.

2.5.2 Basic Refurbishment (existing Nexus funding only) Should no additional funding be available to Nexus, the look and feel of Central Station Metro station would only be developed to a limited and largely temporary extent.

All entrances will be upgraded with dual handrailing and features to ensure full compliance with accessibility legislation but the remaining development would, in effect, only be temporary and superficial improvements to a 1970s design specification.

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The other improvements would not be long-lasting, or provide the quantum change in appearance and facilities required of a regional gateway. Further work would become necessary during the medium term, so this option is not considered to be good value for money, as well as failing to achieve the key objective of the scheme.

Whilst it is achievable to deliver a re-branded station within this budget, it is recognised that there would be substantial compromises in the appearance of the ‘new’ station. The existing vitreous enamel (VE) finishes are not replaced and simply painted white, except wayfinding which is replaced in new branding. No electrical works are included other than those associated with new ceilings such as new light fittings and wiring. No works to platform canopies will be carried out.

In summary, should no additional funding be available and the scheme has to be delivered within ARP funding only, the quality of finish to the station will be severely affected. The proposed scope of work would therefore be restricted to:

 Dual handrails installed throughout  Repainting existing finishes throughout  Replacing wayfinding with the new branding  Flooring replaced with tiled product  Replacement of fire detection system

2.5.3 Recommended full scheme refurbishment (includes Nexus & Single Local Growth Funding) Network Rail’s guide to station planning focuses on the use of high quality materials and finishes appropriate to station context and function. It suggests that high quality investment at locations that support high volume station usage are both affordable and cost-effective and can significantly enhance the function, performance and aesthetic of a station. This emphasis on high quality investment shows the importance of doing more than the basic décor improvements that would be achievable without additional funds.

In addition to the items delivered through Nexus ARP funding, the following can be delivered to combine value for money, with the level of customer improvements that will allow Central Station Metro to play a full part in helping to facilitate the economic regeneration of the area it serves.

 Replace ceilings throughout  Replace concourse VE  Replace platform VE  Replace low voltage equipment  Replacement of escalator 3 rather than refurbishment  Replace lower lobby/escalator VE  Concourse & entrance finishes  Resin floor  Replace platform canopies

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Diagram 1 shows the visualisation of the ticket concourse area in the full scheme development

Diagram 2 shows the visualisation of the platform in the full scheme development.

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The full scheme proposes the complete refurbishment of the station concourse and platforms in a style in keeping with the recently-refurbished Haymarket Metro station. It will also see a complete replacement and modernisation of the floor, ceiling and wall finishes, giving a modern look and feel to the station, in line with the works completed at Haymarket station. The lighting will be replaced to be more energy efficient and ensure the station is lighter and brighter.

As part of the engagement plan for the modernisation, Nexus invited passengers and local stakeholders to vote for their favourite colour to be adopted in parts of the refurbishment. This not only gave passengers advance warning of the project which would cause some disruption but also aimed to build a sense of ownership in the plans among passengers. Light blue was the clear winner and below is an image of how the colour scheme was presented.

Diagram 3 shows the visualisation of the lower concourse and platform areas incorporating the light blue colour.

High quality anti-slip resin surfaces will be applied to ensure a reduction in slips and trips and ensure the look and feel of the station is not compromised by avoidable dirt or damage to surfaces over time.

Improvements will be made to wayfinding and information with new passenger information screens on the platforms and concourse, in line with passengers’ preferences for improved station facilities as outlined in the Passenger Focus report previously referred to. Improvements will be made to wayfinding information between Metro and onward travel

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including Mainline rail, bus, cycling and walking as well as key destinations around the City Centre.

It is also possible that the Nexus Travelshop may relocate in some capacity to the main line station, if agreement can be reached with Network Rail. It should be noted that the current scheme does not include for any works to the Travelshop area. Future plans for the Travelshop are in their infancy, and if implemented would improve information provision and help passengers access real time travel information, not just about Metro journeys but also for onward travel. The relocation of the existing Metro Travelshop to the upper Network Rail station concourse would also raise the profile of Metro to a wider audience, and provide more accessible and commodious facilities for passengers and staff. This in turn provides scope for new retail activity on the Metro station concourse resulting from vacation of the existing Travelshop premises.

Improvements will be made to the external entrances on Neville Street and Grainger Street to better integrate the Metro station entrances with the wider public realm. Additionally improvements to signage and the entrance to the Metro station from the main-line station concourse will be made in consultation with Network Rail.

The value management workshop prompted thought that replacement or refurbishment of escalator 3 would be appropriate as the escalator is now overdue a half-life refurbishment. This is additional to the scope, however would represent value and reduce risk of negative publicity if work to the escalator was carried out during the station refurbishment works. After review of the newly installed light fittings, it appears unlikely that they can be retained as they have been designed for a coffered ceiling design, something which is being replaced. The other principal areas where value can be achieved are through material and finishes selection, effective design development and effective contractor management throughout the project.

In any development, there is scope for the below-ground concourse to function more effectively in terms of retail, information and accessibility criteria through provision of new facilities, however substantial physical constraints exist both in terms of the underground station ‘box’, and the physical and architectural demands of the Grade I-listed Network Rail main line station building located directly above.

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3. The Management Case

3.1 Introduction

The Management case will set out a clear plan to ensure that the problem identified in the strategic case can be resolved through the proposed solution and that objectives can be realised. The section will detail the project planning, governance structure, risk management, communications and stakeholder management, benefits realisation and assurance.

In 2010, Nexus received confirmation of up to £350m from DfT which, together with a 10% local contribution, provides potential funding of £389m which has allowed the organisation to embark upon an 11 year asset renewal programme (ARP). This planned long-term approach has allowed Nexus to look to the future needs of the system, helping to maintain the essential and integral part of the public transport network in the region, the importance of which was highlighted in the strategic case.

In order to assist the organisation in delivering this ambitious programme, whilst continuing to provide an attractive service to customers, Nexus has transformed itself in to an effective Project and Programme Delivery Organisation by introducing and developing: a dedicated team of multidisciplinary Project Managers, an Engineering team to provide project sponsorship and standards, and a Programme Assurance team to provide robust challenge and comprehensive reporting together with estimating, cost management and commercial support functions. Additionally, in order to maximise delivery efficiency, Nexus has introduced a Capital Delivery team to directly undertake specific engineering projects which is proving to be highly successful.

Nexus has now completed 5 years of successfully delivering the 11 year Metro ARP. To date, Nexus has invested £181.7 million, operating entirely within the stringent terms of the DfT grant funding arrangement which permits only limited flexibility of funding between financial years. Following a rigorous external audit by Asset Management Consulting Limited commissioned by the DfT in October 2012 Nexus were awarded full grant funding for years 4-6 and following further audit in November 2014, early confirmation of funding for subsequent years was achieved though so far only 2016/17 is confirmed at 100% with years 8 & 9 so far confirmed at 75% and the final tranche is still at 50% with any increase being dependant on meeting project delivery conditions set by DfT This was in response to a case presented by Nexus to deliver a long term Permanent Way procurement strategy and ensure significant efficiency savings.

Year on year, Nexus is concurrently Project Managing over 100 projects, one of which is the Central Metro station upgrade. The projects managed are often multidisciplinary in nature with complex dependencies and stakeholder interfaces and individual contract values can exceed £10m. The upgrade to Central Station will be another project delivered in line with the Asset Renewal Plan Governance, Processes and Controls and will directly benefit from the skills, knowledge and experience accrued by Nexus over the last 5 years.

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3.2 Programme management

3.2.1 Project accountability The individuals filling the key posts for this project to upgrade Central Station Metro station are listed below. Accountability for delivery within the project sits with the Project Manager (Stuart Clarke). The Project Manager is responsible for delivery of the Client’s scope within the Project Team, meeting the programme reporting requirements to timescale.

Client Representatives Client Helen Mathews Asset Manager Brian Wilson (HoE) Deliver Representatives Head of Renewals Neil Blagburn (HoR) Project Manager Stuart Clarke (PM) Assistant Project Manager Mark Whitaker CDM and Designers CDM Client Nexus CDM Coordinator- Client’s nominated rep CDM Principal Contractor’s Rep TBC Other contractors TBC Design consultant Arup Project Support Head of Programme Assurance David Shields Project Planning David Cole + external specialists Procurement Manager Julie Warnett Commercial Manager (Interim) Rachel Gibson Quantity Surveyor David Hindmarch (Senior QS) PMO Analyst/ Planner David Cole

Nexus Corporate Management Team (CMT)

Capital Steering Group

 Director of Finance and Resources  Director of Rail and Infrastructure  Head of Renewals  Head of Engineering  Head of Programme Assurance

 Head of Metro Delivery, Planning and Performance  Head of Capital Delivery

 Capital Accountant  Corporate Procurement Manager

 Group Project Managers

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3.2.2 Nexus project governance Central Station, in line with all other projects undertaken by Nexus is subject to a code of corporate governance which is consistent with the principles of the CIPFA/SOLACE Framework “Delivering Good Governance in Local Government”. The governance framework comprises the systems and processes, culture and values by which Nexus is directed and controlled and its activities through which it accounts to, engages with and leads its communities. It enables Nexus to monitor the achievement of its strategic objectives, and consider whether those objectives have led to the delivery of appropriate services and value for money.

Control of Nexus’ Asset Renewal Programme is managed using the governance processes and tools detailed in the Nexus Project Controls Manual. This provides a framework for delivery of the Nexus Asset Renewal Plan and the Central Metro Station project will also be managed using this governance process. The manual outlines the processes and procedures by which schemes must follow. Project governance is applied through the Stage Gate and Engineering Change process. All ARP projects delivered by Nexus, with the exception of Capital Maintenance projects, must follow the Stage Gate process.

Chart 4 outlines the core areas of the manual which covers strategy, development and implementation.

Chart 4: Overview of Nexus Project Controls Manual

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3.3 Project Planning The Stage Gate process breaks up a project into logical steps or stages and ensures Nexus consistently control projects that renew the Metro network. Nexus has developed this approach to monitor, review and approve the development of projects and ensure their compliance with relevant policies and processes.

The Stage Gate process also aims to minimise and mitigate the risks associated with delivering projects. It divides a project into seven distinct stages. The overall approach is product, rather than process driven, and within each stage an agreed set of products should be delivered to fulfil the Stage Gate requirement.

1. Output definition 2. Pre-Feasibility 3. Option selection 4. Single option development 5. Detailed design 6. Construction test and commission and hand back 7. Project close out

Formal Stage Gate reviews are held at prescribed points within the project lifecycle. The Stage Gate review process provides assurance that the project complies with the relevant policies and procedures and is in line with the agreed scope and objectives. Additionally, it ensures that all appropriate internal and external stakeholders are consulted. The Stage Gate Review Group approves or rejects progression of the project to the next stage. Stage Gate 5 was approved for the Central Station Metro redevelopment project on 1st June 2015. This provided the preferred option as discussed in the strategic case and the financial estimate on which this case is based. It should be noted that the financial estimate at Stage Gate 5 includes the tender value and revised risk register. Out-turn cost certainty at this stage is typically better than +/-10%.

The Nexus Programme Assurance team ensures that all project programmes contain the necessary Stage Gate milestones and produce an annual Stage Gate Baseline in conjunction with the Project Managers. Deviations to amend the baseline can only be made following a strategic change which impacts on the development of a project. Any changes must follow the Nexus Engineering Change process, owned by the Head of Engineering and then be approved by the Stage Gate Review Group in advance of the change.

This procedure is to ensure that the project documentation complies with the requirements of The Railways and Other Guided Transport Systems (Safety) Regulations 2006 (ROGS). It is also intended to standardise the information requested and provided, to ensure that the objectives, deliverables, timescales and budgets are clear to all relevant stakeholders and interested parties, at all stages of the projects.

The Head of Engineering (HoE) and Head of Renewals (HoR) review and sign off the Stage Gate pack and therefore validate that the documents have been complete and the

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necessary approvals obtained. The Stage Gate review meeting is chaired by the Head of Programme Assurance.

The planning for the Asset Renewal Programme uses proprietary project planning software and Primavera (P6) is Nexus’ preferred choice. It is the responsibility of the Project Manager (PM) to ensure the programme is up to date and accurately reflects the project costs and progress. The project programmes contained in P6 are updated at least once a period at the PMO Reviews. Updates also take place:  With each Stage Gate estimate  Where a strategic change has been agreed  On receipt of a revised contractor’s programme (design and construction contractor)  Where a Stage Gate or other key milestones are missed  Where compensation events (CEs) or early warnings (EWs) have been received or issued  When a financial change to the project is authorised.

Central Station High-level Milestones:

Activity Name Start Submit Planning Application / Listed Building Consent 21-May-14

Detailed design finalised. 13-Aug-14 Prior Information Notice (PIN) Issues Sept 14 PQQ Issued Jan 15 Out to tender (Main Contract) 9 March 15 Main Contract award July 15 Main Contract commence on site Sept 15 Main Contract Completion Sept 16

Construction activity sequence and milestones will be developed in conjunction with stakeholder consultation and contractors programme. This is dependent on requirements relating to maintenance of access and platform / station closure constraints.

3.3.1 Overview The Programme Review role stands to one side of the programme structure, its core purpose being to help ensure that the business case is adhered to, that user needs and expectations are being met and managed, and that the scope of the programme is not creeping. The Programme Review team is there for the Programme Board to call upon; however others may approach the team for assurance at any time.

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External review will be undertaken by the 4ps Gateway review process, additionally Nick Higton, European Head of Rail at Arup has been allocated an internal review role on the programme for the Arup framework services.

Project Progress Reports are complete each period as per the below. All reporting is undertaken by Finance and the Programme Assurance Team in conjunction with the Project Managers . The process below provides an overview of the key outputs. The process is cyclical each period and contains regular check points each period, and key responsibilities and meetings for each person during the reporting are identified.

PM utilisation Reporting NRBR Forecast V actual spend

Finance budgets/ P6 PMO Draft dashboard & Final dashboard actuals/ actual/forecast Review forecast & forecast commitments update

Detailed Detailed Review Review

Finance Progress Management Committee PMO/ DfT Report Report

Ex Progress Report Executive

Chart 5: Period Reporting overview

Data from Nexus’ Finance Department is the primary source of actual financial progress each period, including ARP Budgets in current year and future year, actual spend in year to date, commitments and project transactions in the year to date. This data is used to measure the performance of the previous period’s forecast and project progress. This information, with the period PM utilisation is produced by Programme Assurance and reported by the Head of Renewals at Nexus’ Monthly Business Review.

It is the PM’s responsibility to provide accurate information to enable a programme and cost update including costs, forecasts, completed and planned activities and risks. The PM owns the forecast and must endeavour to deliver the programme on time and to budget. The actual reporting outputs are produced by Programme Assurance, who will ensure that the necessary information is produced and verified within the necessary timescales, challenging this when necessary.

Following this initial review by Programme Assurance, each period an ARP Steering Group Meeting takes place, designed to provide a strategic overview of the programme costs, status, issues, procurement, engineering and planning performance.

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Following the Steering Group, each PM Group (Civils & Architecture, Mechanical and & Electrical and Signalling and Communications) attends Detailed Review with all members of their team to review their projects. All significant projects with a budget provision of more than £500k will be reviewed, along with any other projects with strategic importance, or which require a decision or direction. All members of the Project Team will participate in the Detailed Review.

This review provides an opportunity for senior management to question the project status and costs, but also for the PM to highlight any issues which requires guidance or feedback. Detailed Review takes place every period and must be attended or submit a deputy. All PM’s must attend Detailed Review and ensure they have sufficient information to provide an update and answer any questions relating to scope, programme, costs and risks.

3.3.2 Reporting All ARP Programme reporting is undertaken by Finance and the PMO. All figures are produced from the P6 forecast which is updated with the PM during the PMO Reviews as detailed above.

ARP Reporting is via internal routes at: Nexus Corporate Management Team, and to the North East Combined Authority at its Leadership Board. In addition, an overview of the programme is also reported to DfT each period.

Nexus Corporate Management Team

Stage Gate Committee

Engineering Change Process

Assistant Project Project Manager Manager

Client / PE

The meeting schedule as detailed below dictates the Nexus Capital reporting outputs. The project for Central Station Metro station will comply with this comprehensive reporting process.

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Periodic Quarterly Annual Comments

Monitoring Corporate

Management Team x These reports update the relevant DfT x committee with progress of the current year programme in meeting NECA (Tyne & Wear x DfT target spending levels. Includes Sub Committee a review of progress todate, planned

work and variances .

Affordability Corporate x Management Team These reports update the relevant committee with affordability updates

of the eleven year programme NECA (Tyne & Wear x against the available £389m Sub Committee) resources (£350m DfT funding and

£39m local contribution.

Programme Corporate

Management Team x These reports update the relevant

committee with the proposed DfT x programme for the following

financial year. NECA (Tyne & Wear x Sub Committee)

3.4 Evidence of similar projects undertaken Nexus has the proven capability to deliver the project in–house, as evidenced by its successful stewardship of the wider Metro ARP. Successful delivery of the Central Station Metro station project depends upon the following factors and Nexus can demonstrate capability and compliance in all of these areas:

3.4.1 Internal  Proven project management skills with the ability to deliver complex projects to time and on-budget.  Specialist rail industry skills and oversight, to ensure that progress of the scheme in a confined area and a working railway environment is successfully executed.  Detailed asset knowledge of the station and its interfaces with the public highway and Network Rail infrastructure.  An important constraint relates to the need to complete the Metro station refurbishment within the timeframe of other station renewal schemes contained within the Nexus asset replacement programme forming part of the Metro reinvigoration scheme.

3.4.2 External  Effective working relationships with Network Rail, Newcastle City Council and Metro operating concessionaire DB Tyne & Wear are all essential to successful scheme delivery.

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 Nexus and DB Tyne & Wear hold regular concession liaison meetings and any temporary and permanent changes to operating practices will be agreed and implemented through this mechanism. Since March 2010, the Nexus Asset Renewal Plan has delivered over £180m of investment in Metro Infrastructure including:-

 Refurbishment or re-branding of 20 Metro Stations (Including North Shields, Howdon, Meadow Well, Chillingham Road, South Gosforth and West Jesmond.  Renewal of 24 km of track - including the QEII Metro bridge. Track renewal was completed to plan in 2 weekends in May 2015.  12 Bridges Refurbished, 10km of remedial earthworks.  31 km of duct route renewed or refurbished.  16 Escalators and 12 lifts replaced.  44km of signal cable replaced.  80 Metro Cars refurbished.

Two of the most complex ARP projects are now underway - Radio System replacement and renewal of the Metro Route setting system (Rail Traffic Management System). These are complex multidisciplinary projects with interdependencies and demanding stakeholder needs. Their combined budget is in excess of £20m.

Other major projects delivered outside of the ARP Programme include the Haymarket and Sunderland Stations and the Smart ticketing programme including the introduction of new ticket machines, validators and gate-lines. o Haymarket refurbishment

Platform 2 Haymarket- Before and After

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Escalators Haymarket- Before and After o North Shields

Entrance North Shields- Before and After

Platform Concourse North Shields- Before and After

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Platforms North Shields- Before and After

3.5 Evaluation The objective statement can be separated into three key objectives as detailed below;

1) Providing a top class passenger experience

2) Central Station Metro becomes part of key regional gateway, supporting the Newcastle Gateway project and wider economy

The following indicators are proposed to measure the achievement of the objectives.

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3.5.1 Quantitative indicators Target Indicator Baseline Target Source Notes date Work undertaken for the Metro Asset Renewal Plan business case, Nexus Continuous accepted in full by the Department for Transport, suggested that Passengers boarding at Central station 2.6m +2.7% By 2017 Monitoring surveys regeneration of a station would increase patronage by 2.7%. Baseline from 12 months to 08/02/14 Work undertaken for the Metro Asset Renewal Plan business case, Nexus Continuous accepted in full by the Department for Transport, suggested that Passengers alighting at Central station 2.38m +2.7% By 2017 Monitoring surveys regeneration of a station would increase patronage by 2.7%. Baseline from 12 months to 08/02/14 Average score out of ten Nexus Metro passenger Overall (all) 7.9 8.3 By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Nexus Metro passenger Condition of escalators 89.1% 95% By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Nexus Metro passenger Condition of lifts 73.9% 95.0% By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Nexus Metro passenger General cleanliness of station 77.0% 95.0% By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Nexus Metro passenger Condition of the station 78.6% 97.0% By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Nexus Metro passenger Helpfulness of signage at the station 92.2% 97.0% By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Nexus Metro passenger Information on train arrivals/departures 89.7% 95.0% By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Ease of understanding signage at the Nexus Metro passenger 94.4% 97.0% By 2017 Based on Haymarket performance, 2010/11 to 2013/14 station satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Nexus Metro passenger Lighting at the station 85.8% 97.0% By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Nexus Metro passenger Your personal security at the station 87.7% 95.0% By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2013/14 Proportion of people boarding at Central station Metro and using another Nexus Continuous Level of interchange with other modes 21.4% Increase By 2017 form of public transport imediately before or after Monitoring surveys Baseline from 12 months to 08/02/14 Proportion of people boarding at Central station Metro and using another Nexus Continuous Level of interchange with main line rail By 2017 form of public transport imediately before or after Monitoring surveys Baseline from 12 months to 08/02/14 Average score out of ten Nexus Metro passenger Overall satisfaction of disabled users 8.1 8.5 By 2017 Based on Haymarket performance, 2010/11 to 2013/14 satisfaction surveys Baseline from 2010/11 to 2012/13 Average score out of ten Overall (travelling with luggage, Nexus Metro passenger 7.8 8.5 By 2017 Based on Haymarket performance, 2010/11 to 2013/14 shopping, prams) satisfaction surveys Baseline from 2010/11 to 2013/14 % of people satisfied Does the station meet the needs of Nexus Metro passenger Based on Haymarket performance, 2010/11 to 2013/14 78.3% 90.0% By 2017 disabled passengers satisfaction surveys Baseline from 2010/11 to 2013/14 Note// very small survey sample

Much of the information required for these indicators is available to Nexus through existing research work routinely carried out. For example, Nexus conduct Customer Satisfaction tracking surveys twice per year and the sample size can be increased to ensure a robust sample with regards to Central Station Metro. Nexus also carry out a statistically robust sample of passenger interviews to estimate patronage levels and a sub set of this information also indicates passenger profile information. Nexus asset reliability information provided through Maximo asset management system or SCADA asset reporting.

3.5.2 Qualitative indicators Wider impacts for the project could include increased levels of retail activity in or surrounding the station. The proportion of people alighting at Central Station Metro for shopping and leisure purposes can be monitored.

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On average in the UK a commute by car emits 2.51kg of CO₂ (DECC - UK Climate Change Sustainable Development Indicator: 2009 Greenhouse Gas Emissions, Final Figures). If only 10% of the predicted 70,000 additional boardings at Central Station switched their commute from car, this would save over 17,000kg of CO₂ per year.

Improved physical accessibility can be quantified by the numbers of customers using the additional escalator and refurbished lifts, measured through manual counts.

Monitor the passenger’s home district to determine any change in the residential catchment area of people using the station.

3.6 Risk Management A Risk Management Strategy has been developed and implemented in order to set the direction, scope and priorities of risk management within the Asset Renewal Plan. Risk management helps the Project Manager to identify and address the risks facing Nexus and in doing so increases the likelihood of successfully achieving our businesses objectives.

The primary output of the risk management process is a Risk Register. By identifying the risk and probability/ likelihood of a risk occurring, the Risk Register allows the PM flexibility to use theirs and their QS’s experience to determine the financial value of the risk. The Risk Register is a live document throughout the project and is regularly reviewed and updated, but as a minimum is updated for each Stage Gate. The financial value generated by the Risk Register should justify the financial risk associated with each project and should in normal circumstances be the value included in each Stage Gate estimate as the contingency value.

The formation of the risks and associated actions are compiled through a project Risk Workshop, which includes all related stakeholders contributing to the identification and management of the risks. The Risk Register is then reviewed and challenged as part of the Stage Gate approval. The PM is responsible for ensuring the document accurately reflects the live risks and associated financial risk to the project.

A Risk Workshop for the Central Metro station was conducted on 11th September 2013 to determine current project risks and allocate estimated values, should the risk materialise and the costs of appropriate mitigation measures. The main areas of risk are wherever a delay to the contractor can occur, however there is sufficient time to ensure appropriate mitigation actions are taken. Other significant risks emanated from the installation of a fourth escalator, uncertainty surrounding the scope of the Travelshop and asbestos containing materials as a demolition survey is yet to take place.

Asbestos containing materials (ACM) have been identified as being present on site, however at this stage the impact of these on the project is unknown pending a detailed demolition survey, which is currently being commissioned. A contingency sum has been included to cover the management of ACMs, which will be refined accordingly following completion of the demolition survey.

A full risk register which outlines the main risks identified at this stage has been compiled and is available as an appendix 7.1. This register provides a costed assessment of project

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risks derived from the financial impact and the likelihood of the events occurring. Other than financial and engineering risks, the main other risk which has been identified at this stage surrounds the management of interfaces, which will be managed appropriately as described above. Otherwise the largely self-contained nature of the site results in the majority of risks lying within the control of Nexus and its contractors. Chief risks include unexpectedly adverse asset conditions, any unforeseen planning issues at the interfaces with the Grade I listed Newcastle Central building which sits above the Metro station, and revenue losses incurred during the construction phase.

Over the development of this scheme, the risk register was also used to review design options as selecting a particular design option may remove several risks and therefore reduce the financial risk to the project.

Other constraints to the programme include cost, health and safety imperatives, the requirement to keep the station open to passengers as much of the time as possible and in any event, to maintain the continuous flow of trains through the station platforms, to and from other destinations.

Following the risk workshop, a contingency figure of £2.092 million was derived, this has been updated following completion of design and tender evaluation and at Stage Gate 5 a revised value of £1.329 million has been determined.

Combining the more comprehensive scheme as proposed in this case with the basic maintenance programme will result in substantial economies of scale and minimise the period of disruption experienced by station users. The timing of the Nexus ARP is such that the scheme for which major schemes funding is being sought, needs to proceed within the short-term to maximise engineering synergies and minimise the period of disruption to customers.

Indefinite delay to implementation of the scheme would also result in higher asset running costs, as ad-hoc asset replacements may become necessary to ensure that the premises continue to function in a safe manner. Higher running costs can manifest themselves through the continued use of non-low energy lighting for instance, or the need to manufacture bespoke parts to maintain equipment for which spares are no longer supported by the original manufacturer.

As part of the overall Metro reinvigoration process and asset renewal programme, additional start-up and scheme costs would be incurred to mobilise internal and external delivery processes from scratch. Such costs could include those of project management, procurement, equipment hire and arrangements with contractors. These can be obviated if the scheme proceeds whilst the wider programme remains under way.

3.7 Communications and Stakeholder Management

3.7.1 Stakeholders Nexus will implement a stakeholder communication plan to ensure the successful communication with stakeholders before, during and after the project.

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A thorough and well-executed communications plan can support the project by making sure:

1) Stakeholder expectations are understood and addressed in the design stage; 2) There is effective engagement and communication with affected stakeholders during delivery and, 3) The benefits of the finished station are ‘sold’ as a successful and value-for-money outcome, satisfying all funding partners.

The objectives of this communication plan are to;

 deliver industry ‘Best Practice’ standards in engagement and communication around major works. . identify stakeholders who should be consulted during the design stage and ensure sufficient engagement takes place. This includes consultation on both the final appearance of the station and methods for project delivery (eg. access and closure times, siting of compounds, delivery of materials) . ensure all relevant stakeholders are aware of forthcoming works, potential impact on them and their customers/clients, and contingencies in place. . ensure that all relevant stakeholders are kept updated of progress during the project and of changing arrangements and contingencies as they arise. . identify and exploit the best channels to provide communication, including the use of new digital solutions relevant to a very busy city station. . provide briefings to local and social media, monitor reaction and deal with issues as they emerge through these channels.

The basic statement to use with stakeholders and media, from which further information may be hung is as follows:

“We are delivering a key project to refurbish Metro’s Central Station as part of the £389 million modernisation of Metro. Passengers will benefit from a brighter, better station with improved access, information and waiting facilities. The work will complement the improvements already made by East Coast and Newcastle City Council at this key regional gateway.

This is a very busy station in the heart of the city, and we will be planning and working very closely with our partners to make sure disruption is kept to a minimum while out project is completed. While some short-term inconvenience is inevitable the long-term benefits will far outweigh this.”

The stakeholder map in chart 6 shows the identified key stakeholders and the degree of engagement with these groups, as defined as below:

 Involve – Engage at an early stage to understand expectations and limitations which may impact on scheme design and project delivery  Consult – Engage during design to ensure project meets statutory requirements.

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 Engage – Engage prior to work on site commencing to ensure concerns are addressed during works  Inform – Communicate with before and during works.

The degree of engagement is cumulative, so every stakeholder in the ‘Involve’ category would also be included in ‘Engage’ and ‘Inform’ activities as the project continues.

CONSULT INVOLVE City Council - (planning, transport, City Council – leader and cabinet heritage) LEP Heritage/arts bodies ITA members Access organisations DBTW Artist with work in the station Network Rail/East Coast Rugby World Cup local organiser DBTW tenants/Nexus Travelshops INFORM ENGAGE Frequent Metro passengers Local businesses Occasional Metro passengers East Coast tenants Train operating companies Taxi operators Tourism/visitor bodies

Chart 6- identified key stakeholders and the degree of engagement with these groups

In general ‘Involve’ and ‘Consult’ activities will be led by the Project Team. Assurance of this taking place was provided at the relevant Stage Gate 3 and Man Com approval points.

The Communications section will lead ‘Engage’ and ‘Inform’ activities with wider stakeholders with tactics set out below.

The main stakeholders in the project are identified as Nexus, Network Rail, Newcastle City Council and business improvement district company NE1. Each of the external partners is fully supportive of the scheme, and will liaise with Nexus at interface points to ensure its successful delivery.

No potential conflicts between these stakeholders are envisaged. Any practical issues arising during the project will be ironed-out by means of regular stakeholder liaison meetings. All key stakeholders support the improvement of facilities in the Central Station area. Although this scheme is separate from the above-ground Network Rail improvements programme and the comprehensive streetscape improvements being implemented by Newcastle City Council and business improvement district company NE1, it will be perceived by most station users as integral or complementary to the wider scheme. A similar reaction can be forecast in respect of the Metro station scheme which if not proceeded with could draw negative comparisons with the quality of above-ground provision. Nexus undertook a 12 week period of public consultation in 2014 where the views of local stakeholders and passengers were sought through online feedback and local events.

Work on site will take at least one year, preceded by a lengthy and detailed design period and there will be varying levels of disruption to passengers and neighbours until it is

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complete. As such, the project will likely attract greater stakeholder interest than previous station refurbishments for two reasons:

1) The status of the station as part of a regional and city gateway comprising the adjacent national rail station, bus, taxi and road network;

2) The number of passengers using the Metro station – more than five million a year – and the very high flows at peak times.

Stakeholders will expect to see a finished project which meets their aspirations for a 21st century transport gateway, reflecting improvements made to the national rail station and surrounding road network. They will expect this to be achieved with the minimum possible disruption to passengers, particularly at key times of day or week and during key events, such as the Great North Run and 2015 Rugby World Cup.

The project is complex because of the need to maintain access and service for passengers, the constrained city centre location and internal financial constraints. It is also dependent in part on external funding, which must be reflected in some of the communications deliverables.

3.7.2 Engagement Three months prior to work commencing, Nexus Communications will begin an engagement programme contacting all identified stakeholders and inviting them to attend a drop-in session or otherwise ask questions online. This will be carried out in conjunction with the Project Manager and Principle Contractor. The aim is:

 To consult on how work will be carried out and invite feedback which could assist in the smooth delivery of the project, including aspects like compound siting, delivery times, information points etc.  Establish direct contact routes through which any complaints/concerns can be addressed quickly.  Provide information on the final appearance of the station – though this will not by this stage open to change. Direct contact will continue at landmark points through the project to keep this group informed and maintain confidence.

Further to this, as part of the engagement plan, Nexus invited passengers and local stakeholders to vote for their favourite colour either on the station itself or by email and social media.

Members of the Nexus community relations team were used on station to proactively promote the scheme, give passengers advance warning of a major project which would cause some disruption, and build a sense of ownership in the plans among passengers. Passengers could vote using tokens in voting tubes, overseen by community relations officers. These staff often work alongside project managers on major schemes as part of the Metro Reinvigoration programme as well as having a wider community and stakeholder liaison role and could answer questions across a range of subjects.

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The initiative took on a very high profile with staff presence at peak times over three separate days. The response from passengers was incredibly positive and attracted a wide level of interest. The whole process enabled Nexus to promote the upcoming station modernisation in an engaging way to a significant number of passengers who were at the heart of the decision making process and have ownership of the modernisation.

3.7.3 Information Three weeks prior to work commencing an information campaign will be launched by Nexus Communications in partnership with DBTW, the station operator. This will inform passengers of the works, any contingencies in place and routes for more information. It will continue and be updated at milestones in the project. This will specifically include making third party operators and visitor bodies aware of any limits to access or station closures which might delay passengers making connections.

Specific focus will also be on arrangements during Rugby World Cup matches from 2-11 October 2015 when a greater number of visitors can be expected, as well as during Great North Run and any summer concerts at St James Park or Stadium of Light.

Traditional communications tools including media announcements, website information, posters, PA and PIDS on system will be exploited. This strand of the plan will also include use of digital and social media to profile and maintain confidence in the project – for example using QR codes to show videos or images of work taking place.

An event, including media invitation, will be held to mark the successful culmination of the project recognising the contribution of all partners.

3.7.4 Feedback Nexus Communications will be the conduit for feedback from stakeholders during the engagement period (from three months prior to works) and will pass on relevant comments to the Project Team.

Nexus Communications, through the Community Relations Officer for Newcastle, will maintain relationships with local stakeholders and monitor levels of complaint and concern. Updates will be provided to the Project Manager on a monthly basis with any trends or issues highlighted.

Nexus will seek to gain £8,000 EVA positive media coverage over the duration of the project, targeted at local and railway trade media.

On various days in early 2014, Metro passengers and City Centre stakeholders were invited to drop in sessions to learn more about the plans for Central Station Metro. A meeting at the Centurion Bar, Central Station was targeted at stakeholders but open to members of the public as well. Leaflets were handed out to 2000 passengers during both morning and afternoon peak periods and prior to a full council meeting at Newcastle Civic Centre, Local Ward Councillors and Council employees were given the opportunity to review the plans. In addition, local neighbouring businesses in the Central Station and Stephenson Quarter areas were visited and provided with information on the refurbishment plans and invites to the

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drop in sessions listed above. Email information on the proposals were also emailed out to City Centre businesses by NE1 (Business Improvement District) through their extensive database. City-wide stakeholders were contacted via Nexus Community Relations Database for Newcastle covering over 180 contacts. In all cases, written responses were welcomed by post or to a dedicated email address [email protected].

Overall the feedback received was overwhelmingly positive with additional constructive feedback provided. Of the 29 responses (either written or in person), 27 were broadly supportive of the proposals, one was neutral and one was negative. The issue of most concern is based around signage having been mentioned by ten separate respondents, both way-finding signage for onward travel and also highlighting the availability of the travel shop outside of the footprint of the Metro station. A full report on the consultation feedback is available in appendix 7.2.

In total, more than 5,000 votes were cast on the colour scheme ballot, the results of which are shown below. We believe this is the first time in the UK passengers have been consulted on the colour scheme of a major station. Light blue was the clear winner and this will now be used as part of the modernisation programme that we have planned at Central in the coming year. Like Haymarket, rebuilt in 2009, Central Station will feature a predominantly white interior with feature walls picked out in a feature colour, helping assist passenger navigation.

On FB - FB - Station Email Total: Metro Chron Vote 1 Dark Blue 585 17 20 6 628 2 Orange 484 8 2 3 497 3 Green 665 19 8 8 700 4 Light Blue 1466 10 6 3 1485 5 Plum 769 46 15 16 846 6 Pink 989 12 3 1 1005 Total: 4958 112 54 37 5161

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4. The Commercial Case

4.1 Introduction The commercial case provides evidence on the commercial viability of the Central Metro Station refurbishment project and the procurement strategy that will be used to engage the market.

4.2 Procurement Strategy Procurement will be aligned with the proven Procurement and Contracting Strategies embedded in the established Nexus Asset Renewal Programme. This programme has been delivering a programme of multi-disciplinary rail infrastructure projects since March 2010 of between £35 million and £40 million annually within tightly defined grant funding profiles defined by DfT. The Procurement and Contract Strategy for individual schemes is confirmed at Stage Gate 3 (see Management Case) and forms the output from a workshop involving the Project Manager, Procurement Officer, Quantity Surveyor and Commercial Manager. Control and governance of the procurement process will be undertaken by the Nexus Corporate Procurement team reporting to the Head of Finance. This team has been supporting Asset Renewal procurement since the inception of the programme in April 2010.

4.2.1 Project Management, Cost Management and Planning. These skills will be provided by Nexus Renewals Project Management team and the Cost Management / Quantity Surveyor team within the Nexus Programme Assurance Department (PA Planning support is provided by this team Nexus also has a Commercial Manager who oversees the development of Contract Packages Controls team. Use of internal Project Management and Support resources has proven both cost effective and ensures continuity throughout the Project lifecycle.

4.2.2 Design Services Engineering Design services will be procured (in common with other Nexus Projects) through a Framework Contract. This is a multi-supplier framework and design work- packages are awarded following a competitive process. The framework commenced in August 2011 with an option to extend in August 2014 for a further year.

4.2.3 Central Station Refurbishment - Main Contract. A full 2 stage OJEU procurement will be followed for the Main Construction Contract. (PQQ followed by Invitation to Tender). Evaluation to be based on 60:40, price to quality split.

Timescales for the Main Works Contract are planned as follows: PIN Issued September 2014 PQQ Issued January 2015 PQQ Returned February 2015 ITT Issued 9th March 2015 ITT Returned 1st May 2015 2014 Contract Award July 2015 Contractor Start September 2015

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Contract Completion September 2016

4.3 Contract Management strategy

4.3.1 Overview The management and governance of Asset Renewal Plan related procurement activities is set out in the Nexus Corporate Procurement Manual. This covers all corporate activities across Nexus and is not confined to ARP works.

Delivery of the Nexus Asset Renewal Programme is based on the NEC3 suite of Contracts. NEC is a family of contracts that facilitates the implementation of sound project management principles and practices as well as defining legal relationships. It is suitable for procuring a diverse range of works, services and supply, spanning major framework projects through to minor works and purchasing of supplies and goods. NEC3 comes with full endorsement from the Construction Clients' Board of the UK Cabinet Office. This recommends NEC3 for use on all public sector construction projects. Nexus current contract under the NEC3 April 2013 revision. In addition to Civil and Rail engineering projects all Nexus Asset Renewal Programme Station refurbishment schemes have employed NEC3.

The implementation of NEC3 contracts has resulted in major benefits for projects both nationally and internationally in terms of time, cost savings and improved quality. Since inception of the Asset Renewal Programme, over 40 significant schemes have been completed by the Nexus Project and Commercial Management Team Using NEC3 Contracts. A strong culture of continuous improvement is in place ensuring both technical and commercial lessons learned are quickly assimilated in to the project delivery process.

In addition to NEC3, Nexus employ the IMechE/IET Model Form 1 Contract (MF/1 revision 5) for the supply of electrical, electronic or mechanical plant with installation. This provides both ‘General Conditions’ and sets of additional unique ‘Special Conditions’. This is typically used for procurement of Escalators, Lifts, etc.

Work will be undertaken through a combination of directly-employed labour and sub- contractors, as dictated by the requirements of each stage of the programme. The constrained, sub-surface nature of the site dictates the need for specialist working techniques and appropriately qualified contractors. Interfaces with Newcastle City Council as highway authority and Network Rail as asset neighbour at the escalator/concourse interface will be managed to minimise customer inconvenience and ensure the safety of all station users .Regular liaison between Network Rail, main-line station operator East Coast and Nexus has already been put in place to manage interfaces with the ongoing street-level works and this will be during the Metro station works.

4.3.2 Design services

4.3.3 Central Station Refurbishment - Main Contract NEC3 EEC Option A (activity Schedule) is consider the optimum approach on the basis of a high level of design maturity and certainty at the point of tender invitation.

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The ‘fixed price’ activity schedule based tender gives cost certainty with risk substantially transferred to the contractor (other than that managed under the NEC3 Early Warning and Compensation Event Process)

Target cost options have been discounted on the basis of high Contract Administration resource overheads and relatively low value opportunity to deliver cost savings .

4.3.4 Summary of Procurement and Contract Strategy

Item Procurement Contract Strategy Approach Engineering Design Services Multi-Supplier Engineering NEC3 Professional Services Design Framework - Award Contract Project Management Nexus Internal Resources Not Applicable Programme Assurance - Controls and Nexus Internal Resources Not Applicable Governance Programme Assurance- Cost Nexus Internal Resources Not Applicable Management and Contract Administration Commercial Management Internal / external Not Applicable Construction Contract Legal Services Main Construction Contract 2 Stage OJEU (PQQ - ITT) NEC3 Option A (fixed price activity schedule) 4.4 Payment Mechanisms

4.4.1 Payment Certification This will be made in accordance with NEC3 Option A. Monthly payments certified on full completion of contracted ‘activities’.

4.4.2 Payment terms Payment will be made within 30 days of the date on which a correctly rendered invoice is received, to a bank account nominated in writing by the Supplier.

4.4.3 Late payment On failure to pay any amount properly due and payable under the Contract, the Supplier shall have the right to charge interest on the overdue amount at the rate of eight (8) per cent per annum above the Bank of England reference rate, accruing on a daily basis from the due date up to the date of actual payment.

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5 The Financial Case

5.1 Introduction The financial case concentrates on the affordability of the proposal, its funding arrangements and technical accounting issues and presents the financial profile of the different options and the impact of the proposed deal on the Department’s budgets and accounts.

This business case seeks to gain approval for £2.51m Single Local Growth funding, to be spent on the Central Metro Station refurbishment project during 2015/16.

5.2 Project cost profile Nexus has allocated £3.527m of ARP funding to the Central Metro Station project, equating to over 50% of the funding requirement.

The expected costs for the project are detailed below, by budget stream and the year in which they are expected to occur.

The Department for Transport (DfT) has allocated £31m per annum funding to Nexus in 2015/16 to 2018/19, which represents 90% of Nexus’ Asset Renewal Programme (ARP). Nexus contributes the remaining 10% through local funding.

£300k Single Local Growth Fund (SLGF) contributions have been allocated to 2016/17.

15/16 16/17 17/18 Actual to Grand Forecast Forecast Forecast 14/15 Total Cost Cost Cost £'000 £'000 £'000 £'000 £'000 DfT - ARP Grant funded 686 1,433 1,029 27 3,175 Nexus - ARP Grant funded 76 159 114 3 352 Total - ARP Grant Funded 762 1,592 1,143 30 3,527

Single Local Growth Fund 2,210 300 2,510

Overall 762 3,802 1,443 30 6,037

5.3 Contingency plan A risk management strategy for the project is detailed in the Management Case. The current risk register is also attached as an appendix 7.1 to this document.

The costs for the project can be broken down into the three core areas below, with £1.329m allocated as contingency, determined from the risk register. A full breakdown of costs for the project is provided as appendix 7.3.

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Full cost Construction £ 3,098,214 Project £ 1,609,786 Contingency £ 1,329,000 Total £ 6,037,000

Upon project completion, the project will be capitalised and held as a Fixed Asset. Nexus depreciates its Station category assets over a 40 year useful life. Deferred grant funding will be released to offset against annual depreciation.

There are no state aid issues to address which may constrain or limit the support to the organisation or project.

5.4 Revenue implications The project delivery will result in evening station closures which will impact upon revenue receipts for the duration of the project. Lost revenue has been estimated at £0.220m. The calculated value of lost revenue will be funded from Nexus’ ARP funding stream and, therefore, has not been included within the total project costs.

Estimated lost revenue figure derived from ‘Central Metro station Revenue Considerations’ report, Nexus Business Intelligence, 13/09/13

Replacement bus and taxi services will be provided during station closures. The cost of which has been included within the estimated project costs.

Upon project completion on-going revenue expenditure costs will reduce marginally as a result of efficiencies in lighting and the replacement escalator. All on-going revenue expenditure will be funded from within Nexus’ existing revenue budget.

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6 Economic case

6.1 Introduction The economic case assesses the impacts and the resulting value for money of the scheme. The assessment includes all impacts reported in the Appraisal Summary Table (AST) including economic, environmental, social, public accounts, and distributional impacts. The AST is included as appendix 7.4.

Following this introduction the economic case includes sections on:

 the scheme options appraised (including the do minimum and do something);  a summary of the modelling and appraisal approach;  a summary of the appraisal assumptions used;  a discussion of the key modelling assumptions and model output;  the economic appraisal;  the environmental appraisal;  the social appraisal;  scheme costs;  public accounts impacts;  headline economic impacts and standard appraisal tables;  sensitivity tests;  value for money statement; and  social and distributional impacts.

6.2 Scheme Options Appraised In order to appraise the scheme options, three potential future levels of provision at Newcastle Central have been modelled. These are:

 Do Minimum (DM) – maintenance of safety and current level of facilities, no refurbishment.  Do Something 1 (DS1) – Basic Scheme - achieved with existing funding from the Asset Renewal Programme (ARP), consisting of repainting and cleaning of existing finishes.  Do Something 2 (DS2) – Proposed full scheme - achieved with existing ARP funding plus £2.51m SLGF, consisting of a high class, longer lasting finish covering most of the station and improvements to accessibility.

As the funding for DS1 is secured and this business case is for the additional funding to deliver DS2 over and above DS1, the main appraisal presented here is based on the incremental difference from DS1 to DS2. In order to demonstrate that the full DS2 scheme is value for money, a similar appraisal has been carried out for the DS2 scheme vs the DM and summary outputs from this appraisal are presented in the headline economic impacts section.

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6.3 Modelling and Appraisal Approach

6.3.1 General Approach The general approach assumes that the proposed improvements reduce the generalised cost (GC) for those travellers using the improved facilities. Generalised cost is the overall perceived “cost” for the whole journey, which for a public transport journey will include walk and wait times, in vehicle times, monetary fare costs, and any interchange penalties. All existing users would experience a reduction to the perceived generalised costs of their journey due to the station quality improvements implemented. This is a direct benefit that can be valued in money terms and therefore reduces the generalised cost of the journey. All existing users will experience the full value of the station improvement benefit.

As well as benefitting existing users, this reduction in generalised cost will also lead to an increase in demand. This is modelled using an elasticity relationship, which is a commonly used form of model that relates the demand for a good, in this case public transport patronage, to the price of that good, in this case generalised cost of travel. Using this relationship, together with the base levels of demand, and assumptions about the average journey times and fares, it is possible to calculate the uplift in demand due to the proposed improvements. The form of the elasticity formula used is as follows:

[% Change in Demand] = [% Change in GC] x [elasticity]

Based on the principles of consumer surplus, and applying the standard rule-of-half, new users experience station quality improvement benefits that on average equal half of the total improvement valuation. New users also pay fares that increase the revenue of the public transport operators. Mode-shift away from car reduces congestion and benefits users of the highway network. Using assumptions about what proportion of new users come from car, average car occupancies, and average trip distances, it is possible to calculate a reduction in car kms on the road network. The Department for Transport’s (DfT’s) Transport Analysis Guidance (WebTAG) Unit A5.4 provides guidance and parameters to allow the reduction in car-km to be converted into a monetary value. The benefits of mode switch are largely de-congestion benefits (ie reduced travel time for remaining vehicles due to a reduction in congestion) and accident reduction benefits, but also include highway infrastructure maintenance savings, local air quality, noise, and greenhouse gases. In addition there are indirect tax impacts both from a reduction in spending on fuel (including duty and VAT) and from an increase in spending on PT fares (zero-rated for VAT).

All monetised appraisal values are reported in 2010 prices discounted to 2010 as specified in WebTAG, over the full appraisal period from the current year to 2077 (scheme appraisal of 60 years).

The modelling and appraisal approach has been implemented in an Excel spreadsheet.

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6.3.2 Modelling and Appraisal Data and Assumptions An important input to the modelling approach is the set of data, assumptions, and parameters. These are used to inform the model of the base situation, to define future year scenarios, to control how the model responds to changes in inputs and future years, and how the appraisal is carried out. The table below shows the main modelling and appraisal data and assumptions including:

 base demand data and do minimum demand forecasts;  PT journey generalised costs components;  PT generalised cost parameters;  station improvement valuation and modelling of impacts;  scheme and appraisal assumptions; and  cost and inflation assumptions.

Data Values (if appropriate) Source Demand Data Metro boarding + alighting at Base patronage Newcastle Central Metro 5.26m NEXUS annual patronage data passengers per annum NEXUS passenger survey data on Metro only: 3.13m interchange trips (mode but not Split of demand between journey types Rail-Metro interchange: 1.35m location-specific), assumptions on Bus-Metro interchange: 0.78m interchanges. Exogenous patronage change over time Zero Conservative modelling assumption PT Journey Generalised Cost components Based on walk speed of 4.8kph and Bus: 5 minutes distances of Access and egress times Metro: 10 minutes bus: 400m Rail: 12.5 minutes Metro: 800m rail: 1000m rail. Based on half assumed average Bus: 5 minutes headways of: Wait times Metro: 6 minutes Bus: 10 minutes Rail: 10 minutes Metro: 12 minutes Rail: 20 minutes Based on distances: Bus: 5.49km (NEXUS survey data) Metro: 8.57km (NEXUS survey data) Bus: 22 minutes Rail: 38.99km (national rail avg) In vehicle times Metro: 13.9 minutes And speeds: Rail: 37.31 minutes Bus: 15kph (modelling assumption) Metro: 37.0kph (Metro timetable average) Rail: 62.7kph (TPM3 model data) 2012 prices Bus: £0.71 Bus and Metro based on NEXUS survey Fares Metro: £1.32 data, rail based on National Rail average Rail: £4.95 TAG unit M3.2 based modelling Interchange penalties 7.5 minutes assumptions central value (“5 to 10 minutes”) PT Generalised Cost Parameters TAG unit M3.2 based modelling Walk time: 1.75 Walk and wait time factors assumptions central values (walk: 1.5-2, Wait time: 2 wait 1.5-2.5)

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Data Values (if appropriate) Source Bus: 22.9% commute 77.1% other Bus and Metro from NEXUS surveys, rail Metro: 42.9% commute 57.1% from WebTAG data book November PT mode purpose splits other 2014 sheet A1.3.4 all week average Rail: 16.5% employers business figures. 37.8% commute, 45.7% other Assumed to remain constant. 2018 (opening year) values Bus: £6.97 Metro: £7.14 Weighted averages using purpose splits Values of time – base and forecast Rail: £11.89 (above) and WebTAG data book Growth in range 1.9-2.2% p.a. November 2014 sheet A1.3.2 These and forecast values as per WebTAG databook Station Improvement Valuation and Impacts Modelling The value of £0.19 for the full scheme is based on review of Transport for London, Transport for Greater Manchester, Passenger Demand DM = 0 Forecasting Handbook, and WebTAG. DS1 = £0.12 Station facility improvement valuations DS2 = £0.19 The value of £0.07 for the DS1 has been Full benefit for boarders, 25% estimated from the relative costs for benefit for alighters DS1 and DS2 for the elements of the scheme that will actually be visible to passengers such as the finishings on the floors, walls and ceilings)

Modelling assumption.

Elasticity is a long-run elasticity of generalised cost to demand, used alongside a 4 year ramp-up of demand (meaning it takes 4 years before the full uplift in demand is realised).

The long-run GC elasticity has been estimated from long-run fare elasticity, Elasticity of demand wrt GC -2.5 for which there is good evidence in the literature. Fare typically equates to 11 to 20% of GC, so -2.5 equates to a long- run fare elasticity of -0.3 to -0.5. TRL Report 593 has fare elasticities of -0.3 for rail and -0.46 for Metro.

TAG unit M2 states that fare elasticities typically lie in the range -0.2 to -0.9.

Abstraction rate from car 35% Modelling assumption Based on WebTAG data book sheet A1.3.3 all week all purpose average Car occupancy 1.53 figures per km travelled – allowing for reduction in passenger at 0.5% p.a. to 2018 (opening year) From PT in-vehicle distances: Bus users: 5.49km Bus and Metro from NEXUS survey data, Car distance assumptions Metro users: 8.57km rail from national average rail data Rail users: 38.99km

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Data Values (if appropriate) Source Mix of traffic: North East – Inner and Outer Conurbations Unit benefit rates: Inner and Outer Conurbations

2020 values (2010 prices): Decongestion: 44.12p/carkm WebTAG data book sheets A5.4.1, Highway unit benefit rates Infrastructure: 0.10p/carkm A5.4.2 Accidents: 3.41p/carkm Local Air Quality: 0.00p.carkm Noise: 0.20p/carkm Greenhouse gases: 0.75p/carkm Indirect taxation: -4.84p/carkm

Values vary by year. Car employer’s business: 28.7% Distribution of highway decongestion Car commute: 14.9% Based on average of other large urban benefits Car other: 35.0% model outputs. Freight: 21.5% Scheme and Appraisal Assumptions Price base and discount year 2010 DfT standard appraisal value Opening Year 2018 Scheme assumption Standard DfT 60 year scheme appraisal Appraisal period 2015-2077 period 2015-2044: 3.5% Discount rates TAG A1.1.1 - standard appraisal values 2045 onwards: 3.0% Demand ramp of 4 years is consistent 33% in first year with rail forecasting. We expect a fairly Ramp-up of impact (demand effects and 66% in second year short ramp up of demand change decongestion impacts) 90% in third year because the changes improve 100% from fourth year onwards infrastructure that is already in place rather than a brand new line or station. Cost and Inflation Assumptions GDP Deflator Used to convert between nominal and real prices RPI based on CPI forecasts +1% from as per WebTAG. webTAG data book Annual Parameters Inflation – RPI and costs Other cost/fare inflation values are Fares: RPI +1% to 2034 modelling assumptions RPI 2034 onwards. TAG unit A1.2 Table 8 - based on type Optimism Bias 4% and stage of scheme (Building Projects, Stage 3 – Full Business Case). Market Price Adjustment 1.19 WebTAG data book A1.3.1

6.4 Key Modelling Assumptions and Model Outputs As the following appraisal will show, the main impacts are:

 facility benefits enjoyed by existing Metro users  impacts due to the reduction in car kms on the highway network as a result of mode switch from car to Metro due to the scheme. These are primarily decongestion but also other impacts.

This section provides justification of the key assumption driving the whole model, the value of the facility improvements to users, and a summary of the calculations used to produce the reduction in car kms travelled.

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6.4.1 Facility Improvement Valuation The value used for the full scheme is £0.1887. This has been split between DS1 and DS2 based on the capital costs of each, so DS1 contributes 38% (7.2p) and DS2 adds a further 62% (11.7p).

PDFH chapter C8 contains evidence on the valuation of rail station facilities. This presents a review of a number of studies. The findings from the studies are shown in the table below.

Study Values (if appropriate) Notes Maximum impacts: £1.96-£3.54 2007 prices – National Rail stations from Southampton University – Effects of Capped demand uplift: 9.6%- very large to small. Comprehensive station enhancements on rail demand 13.2% packages. Values in range 21.1-39.9p value Supporting evidence for TfL Business for station environment 21.1p Understood to be 2007 prices Case Development

Waiting facilities 5-8p, security 2000 prices - nothing on station GMPTE Valuation of Station Facilities cameras 8-10p condition valuation Facilities at stations are plentiful 4.4 minutes would equate to Passenger priorities for improvements in and of good quality – ranked 7th of approximately 51 pence assuming £6.94 rail services 13 improvements and valued at per hour 4.4 minutes

There is little evidence on station quality impacts as opposed to station facility impacts. The conclusions in PDFH section C8 suggest good seating provision valuation at 1.1-4.4p, and an enclosed and heated shelter at 7.6p. Values for security improvement are recommended at 5-10p.

The TfL Business Case Development Manual 2013 is publicly available and contains values for station improvements. The most relevant improvement valuations to the types of improvement being proposed are (with valuations in 2013 prices):

 ticket hall very clean (from ticket hall very dirty): 9.63p  platform very clean (from platform very dirty): 6.38p  seats provided in good condition (from seats in poor state of repair): 4.43p  outside of station in good repair (from poor state of repair): 5.60p  electronic information about next train, arrival time, destination and all stations (from no information): 14.83p  CCTV in station (from no CCTV): 12.88-13.14p

There is such a wide variation in values available, and they all apply to station facilities and/or cleanliness, while this is a refurbishment and renewal project more interested in improvements in overall quality. It has therefore been decided to take a relatively conservative approach based on the TfL figures as it is considered these are more relevant to an urban light rail system than the national rail figures quoted in PDFH.

Adding all the quality improvements in the above bullet points together gives an improvement valuation of 53.75p. However the current station is not in as bad a state as described and has both CCTV and next train facilities. To allow for this we have applied a 50% factor to the quality improvements and 25% to the next train and CCTV improvements to give a total benefit of 19.95p (2013 prices). When re-based to 2010 prices for modelling purposes the valuation is 18.87p. It should be noted that, in our modelling and appraisal

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process, this full value applies only to boarding passengers, with alighting passengers experiencing just 25% of the value.

6.4.2 Reduction in Car kms To forecast the demand impacts of the scheme we have used a long-run generalised cost elasticity linked to a 7 year ramp up of demand based. This approach is based on observations by Dargay and Hanly that public transport schemes can take up to 7 years to achieve their full potential demand. The long-run elasticity has been used to forecast the full potential demand response.

We have estimated the long-run generalised cost elasticity from the long-run fare elastic

We have estimated the long-run generalised cost elasticity from the long-run fare elasticity and the ratio of fare to of total generalised cost. However, there are no long-run generalised cost elasticities in the literature.

Metro only Bus-Metro Metro-Rail Total Base trips (person trips p.a.) 3,127,559 784,326 1,348,520 5,260,406 Base GC (minutes) 73.2 80.7 136.3 N/A GC change brd/alight/avg (minutes) 0.69/0.17/0.43 0.69/0.17/0.43 0.10/0.41/0.26 N/A Demand Uplift (assuming elasticity of +1.5% +1.3% +0.5% +1.2% demand wrt GC of -2.5) New trips (person trips p.a.) 46,013 10,467 6,401 62,880 Distance per trip (km) 8.57 8.57 38.99 11.67 avg Total passenger distance (person km p.a.) 394,327 89,702 249,580 733,609 Total car person distance - 35% assumed 138,015 31,396 87,353 256,763 from car (car person km p.a.) Total car distance – assuming car 90,206 20,520 57,093 167,819 occupancy 1.53 (car km p.a.)

The scheme therefore results in a reduction of 167,819 car kms per annum. 6.5 Economic Appraisal The economic appraisal section of the economic case reports the impacts on people travelling in work time, and on companies in the private sector, of the scheme. This includes monetised impacts on the travel of personal and freight users in the course of business, impacts on transport providers, and any other private sector bodies that are affected, for example by providing monetary or in kind contributions to the scheme.

It also includes qualitative assessment of regeneration and wider impacts. All benefits are present values summed over the 60 year appraisal period, in 2010 prices discounted to 2010.

6.5.1 Business Users and Transport Providers Business highway users receive benefits from the decongestion impacts caused by the mode shift impacts from car to PT of the scheme. These are made up of journey time and vehicle operating cost savings. These have been modelled using the methodology and assumptions detailed in section 2.3 above, with the benefits calculated from the reduction in car km and the marginal external costs of car kms as described in TAG unit A5.4 with data in webTAG data book sheets A5.4.1 and A5.4.2.

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Total business user benefits are £1.06m of which:

 Car employer’s business user benefit: £0.42m  Freight user benefit: £0.64m

In addition there are revenue increases to Metro, rail, and bus operators due to the mode shift from car to PT. This has been valued at £2.63m.

Total impact on business users and transport providers is therefore £3.69mReliability Impact on Business Users

6.5.2 Reliability Impact on Business Users As discussed in the Appraisal Specification Report (ASR), in the absence of a network model it is impossible to carry out detailed calculations on reliability using changes in average speeds as per full TAG guidance. A general “rule of thumb” is that reliability impacts are typically 15-20% of total user benefits. This approximation was applied by the Department for Transport (DfT) during their assessment of schemes in the spending review of 2010. Applying an assumption of 15% gives business reliability benefits of £0.16m.

6.5.3 Regeneration As discussed in the ASR a detailed regeneration assessment is not required as the scheme does not affect accessibility directly, but a general qualitative assessment will be useful.

The proposed scheme will provide an enhanced environment for users of Newcastle Central Metro station. The station provides a key access point from the national rail network both to the wider Tyne and Wear region and for key areas of Newcastle city centre. The scheme will improve the “first impression” of Newcastle city centre and the Tyne and Wear area for business and leisure visitors using national rail services and the Metro system.

The scheme ties in with the regeneration of the Newcastle Central mainline station and the wider Stevenson Quarter regeneration programme. The proposed scheme for the Metro station will help to realise the full potential of the wider regeneration plans in the area. Conversely, without the scheme, Newcastle Central Metro station is likely to have a negative or constraining impact on the outcomes of the wider regeneration scheme.

The TAG regeneration worksheet has been completed and is included in the appendices.

The impact on regeneration is judged to be slight positive.

6.5.4 Wider Impacts As discussed in the ASR, we do not have the spatial detail available to calculate wider impacts and so have applied a “rule of thumb” that wider impacts are typically 10% of total user benefits (business + consumer). This approximation was applied by the Department for Transport (DfT) during their assessment of schemes in the spending review of 2010.

The impact on wider impacts is therefore £0.30m.

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6.6 Environmental Appraisal The environmental appraisal summarises the analyses undertaken to assess the environmental impact of the scheme over a number of sub-impacts. Because of the nature of the scheme, the refurbishment and enhancement of an existing Metro station that is largely underground and contained, a number of the impacts have been scoped out at ASR stage. The following sub-headers deal with all impacts on the Appraisal Summary Table (AST). For a majority of the remaining impacts, the primary cause of the impact is the effect of mode shift, and these have been assessed using the marginal external costs of car travel approach.

6.6.1 Noise The impact on noise has been assessed using the modelled reduction in car kms and the marginal external costs of car travel. The overall impact is £0.01m benefit.

6.6.2 Air Quality The impact on air quality has been assessed using the modelled reduction in car kms and the marginal external costs of car travel. The overall impact is £0.00m.

6.6.3 Greenhouse Gases The impact on greenhouse gases has been assessed using the modelled reduction in car kms and the marginal external costs of car travel. The overall impact is £0.03m benefit.

6.6.4 Landscape The scheme is located in an urban area and is largely below ground and within the existing station layout. As a result landscape impact has been scoped out and the impact is neutral.

6.6.5 Townscape The scheme is located in an urban area and is largely below ground and within the existing station layout. There is signage at entrances both within the station and on the station forecourt. Replacement of these signs may have an impact on townscape and they will be designed in such a way to have a neutral or positive impact.

6.6.6 Historic Environment The scheme is located in an urban area and is largely below ground and within the existing station layout. Newcastle Central mainline railway station is a grade 1 listed building, and there are other listed buildings on Neville Street including the County Hotel and St Mary’s Cathedral. The interfaces with Newcastle Central mainline railway station and with the street will be designed in such a way to have a neutral or positive impact.

6.6.7 Biodiversity The scheme is largely below ground and within the existing station layout. Any potential impacts during construction will be mitigated. As a result biodiversity impact has been scoped out and the impact is neutral.

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6.6.8 Water Environment The scheme is largely below ground and within the existing station layout. Any potential impacts during construction will be mitigated. As a result water environment impact has been scoped out and the impact is neutral.

6.7 Social Appraisal The social appraisal assesses the impacts on users not in the course of business, and wider society in general.

6.7.1 Commuting and Other users As with the economic appraisal, users receive benefits from the decongestion impacts caused by the mode shift impacts from car to PT of the scheme. These are made up of journey time and vehicle operating cost savings. These have been modelled using the methodology and assumptions detailed in section 2.3 above, with the benefits calculated from the reduction in car km and the marginal external costs of car kms as described in TAG unit A5.4 with data in webTAG data book sheets A5.4.1 and A5.4.2.

Total commuting and other user benefits are £1.94m of which:

• commuter user benefit: £0.89m • other purpose user benefit: £1.05m

6.7.2 Reliability Impact on Commuting and Other users As with business users the reliability impacts have been estimated using a “rule of thumb” that reliability benefits are 15% of user benefits. This gives commuting and other purpose reliability impact of £0.29m benefit.

6.7.3 Physical Activity The scheme has a marginal impact on mode shift, with increased PT patronage. Some of this will come from car, so is likely to result in an increase in activity, while some will come from walking and cycling so will result in a reduction in activity. On balance these effects are likely to be small.

The impact on physical activity is judged to be neutral.

6.7.4 Journey Quality The improvement in journey quality is the primary benefit of the scheme, providing an enhanced level of service that has some value for users. This has been judged to be £0.073 per boarding user and a value 25% of this for alighting users. In line with the theory of consumer surplus, existing users each receive the full benefit while new users are assumed to experience half the benefit on average.

The journey quality impacts have been assessed at £8.77m benefit of which:

• existing users benefit: £8.72m • new users benefit: £0.05m

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6.7.5 Accidents The impact on accidents has been assessed using the modelled reduction in car kms and the marginal external costs of car travel. The overall impact is £0.17m benefit.

6.7.6 Security A qualitative assessment of the security impacts has been undertaken using the TAG security worksheet. This is included in an appendix to this note. This results in a slight positive impact on security.

6.7.7 Access to Services As discussed in the ASR there is no change in access to services (eg health care, education, shopping) as there is no material change in PT services. This leads to a neutral impact on access to services.

6.7.8 Affordability As discussed in the ASR there is no change in monetary cost of travel as a result of this scheme. This leads to a neutral impact on affordability.

6.7.9 Severance As discussed in the ASR, the proposed improvements are contained within the existing station layout and there will be no severance impacts. This leads to a neutral impact on severance.

6.7.10 Option and non-use values As discussed in the ASR the scheme does not affect the availability of transport services. This leads to a neutral impact on option and non-use values.

6.8 Scheme Costs Scheme costs presented here are the difference between the DS1 and DS2 schemes. These include changes in initial capital investment costs, renewal costs, and operating and maintenance costs.

6.8.1 Investment Costs Investment costs include all scheme costs from the current year to completion of the scheme including any preparation, land, construction, and supervision costs. Total investment costs have been estimated in 2015 prices.

Processing of costs is summarised in the table below and includes the following steps:

 identification of DS2 incremental costs;  distribution of financial year costs to calendar years;  rebasing to 2010 prices by deflating using RPI;  applying optimism bias at 4%;  converting to market prices; and  discounting to 2010.

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All figures in the table are in £000s.

Data 2015/16 2016/17 2017/18 2018/19 Total DS1 costs 762 3,812 1,400 30 6,004 DS2 cost 762 1,302 1,400 30 3,494 DS2 incremental cost 0 2,510 0 0 2,510 Split to Calendar Years 2015 2016 2017 2018 Total DS2 incremental costs 0 1,883 628 0 2,510 In 2010 prices 0 1,680 550 0 2,230 With Optimism Bias @ 51% 0 1,680 550 0 2,230 In Market Prices 0 2,080 680 0 2,760 Discounted to 2010 0 1,692 535 0 2,226

Present value of scheme investment costs for the incremental scheme DS1 to DS2 are therefore £2.2m in 2010 prices discounted to 2010.

6.8.2 Renewal Costs Renewal Costs are assumed to be full scheme costs at 30 years after initial opening, in the middle of the appraisal period. Therefore renewal costs are £2.76m (from the penultimate line in the above table) experienced in 2047. These costs are processed as follows:

 Cost of £2.76m in 2047  Allow for inflation, and discount to 2010: £0.99m

Renewal costs for the incremental scheme DS1 to DS2 are therefore £0.99m in 2010 prices discounted to 2010.

6.8.3 Operating and Maintenance Costs It has been assumed that there are no additional or saved operating and maintenance costs resulting from the scheme.

6.9 Public Accounts Public accounts summarises the overall costs in the 2010 prices and values. There are changes in costs directly related to the scheme such as investment and operating costs, but also indirect tax effects from changes in fuel duty and VAT revenues.

6.9.1 Cost to Broad Transport Budget The cost to the broad transport budget is the total costs to the public sector that are directly related to the scheme. This includes all investment, renewal, operating and maintenance costs. The total cost to broad transport budget is £3.21m of which:

 Local government investment costs: £0m  Local government renewal costs: £0.99m  Central government investment costs: £2.22m

6.9.2 Indirect Tax Revenues Indirect tax revenue impacts arise when there is a change in total fuel consumption and/or PT fare revenue. A reduction in total fuel sales results in a reduction in fuel duty, with the

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money that was previously spent on fuel now being spent on goods or services with, on average, a lower tax rate. An increase in PT fare revenue results in a reduction in tax revenue because PT fares are zero-rated for VAT, and the money spent on PT fares can no longer be spent on goods or services with, on average, a higher tax rate.

The reduction in indirect taxes due to mode shift to PT and the reduction in car kms is calculated using the marginal costs of car kms from the webTAG data book 5.4.1. The reduction in indirect taxes due to increase in PT revenue is calculated using the increased revenue levels from the model and the level of general taxation in the economy from webTAG (19%).

Applying these methods gives a total indirect tax impact of £0.63m (NB – a positive value indicates a positive cost – ie a reduction in tax revenue) of which:

 Highway indirect tax impacts: £0.13m  Local government renewal costs: £0.50m

6.9.3 Present Value of Costs The present value of costs is identical to the Broad Transport Budget described above and is £3.21m.

6.10 Headline Economic Impacts

6.10.1 Reporting Tables The headline economic impacts are reported in a series of tables including:

 The Transport Economic Efficiency table (TEE)  The Public Accounts table (PA)  The Analysis of Monetised Costs and Benefits table (AMCB)

These are included in the appendices to this note. The full appraisal is summarised in the Appraisal Summary Table (AST) which is also included in the appendices. The following sections report the main outputs from these appraisal tables.

6.10.2 Analysis of Monetised Costs and Benefits The AMCB draws together selected monetised impacts in line with DfT guidance, in order to provide a breakdown of the value for money of the monetised impacts in a consistent format for comparison between schemes. The AMCB is presented below.

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Analysis of Monetised Costs and Benefits - £000s (2010 prices discounted to 2010) Noise 9 Local Air Quality 0 Greenhouse Gases 30 Journey Quality 8,770 Physical Activity 0 Accidents 171 Economic Efficiency: Consumer Users (Commuting) 890 Economic Efficiency: Consumer Users (Other) 1,052 Economic Efficiency: Business Users and Providers 3,690 Wider Public Finances (Indirect Taxation Revenues) -628 Present Value of Benefits (PVB) 13,984 Broad Transport Budget 3,211 Present Value of Costs (see notes) (PVC) 3,211

Net Present Value 10,773 Benefit to Cost Ratio 4.35

The analysis shows that the initial BCR of the scheme is 4.35.

6.10.3 Additional Impacts There are some additional benefits described above that have been monetised that are not included in the AMCB above. These are:

 highway infrastructure maintenance savings: £0.01m  reliability: £0.45m; and  wider impacts: £0.30m.

Non-monetised impacts which have been assigned an impact are:

 regeneration: slight positive  security: slight positive

Non-monetised impacts judged to be neutral are:

 townscape;  historic environment;  biodiversity;  water environment;  access to services;  affordability;  severance;  option and non-use values; and  physical activity.

This gives an adjusted PVB of £14.74m and an adjusted NPV of £11.53m. The adjusted BCR is 4.59.

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6.10.4 Full Scheme DS2 vs DM The full scheme (ie DS2 vs DM) has also been assessed to ensure that it offers good value for money. The AMCB for the full scheme is presented below.

Analysis of Monetised Costs and Benefits - £000s (2010 prices discounted to 2010) Noise 24 Local Air Quality 0 Greenhouse Gases 77 Journey Quality 22,797 Physical Activity 0 Accidents 440 Economic Efficiency: Consumer Users (Commuting) 2,294 Economic Efficiency: Consumer Users (Other) 2,711 Economic Efficiency: Business Users and Providers 9,505 Wider Public Finances (Indirect Taxation Revenues) -1,618 Present Value of Benefits (PVB) 36,230 Broad Transport Budget 6,875 Present Value of Costs (see notes) (PVC) 6,875

Net Present Value 29,355 Benefit to Cost Ratio 5.27

The analysis shows that the initial BCR of the full scheme is 5.27. This demonstrates that the scheme as a whole is also high value for money.

Given the modelling approach, with scale of benefits directly related to costs it might be expected that the BCR should be the same. This is not the case for two main reasons:

 Both the facility user benefits for people switching to Metro and the number of people switching are directly proportional to the facility benefit valuation. Therefore the total benefit to switchers is proportional to the square of the valuation.  Scheme cost profiles are different, so the broad transport budget costs are not directly proportional to the headline costs.

6.10.5 Comparison with the Outline Business Case Now that tender prices have been received the optimism bias has been reduced from 51% to 4%. The tender price is lower than expected about £6m in nominal terms with risk allowance compared to about £7m at OBC stage. These two changes have roughly halved the present value of costs, roughly doubling the benefit to cost ratio.

6.11 Sensitivity Tests

6.11.1 Modelling Assumptions Approximately 62% of the benefits are existing Metro user facility benefits, with the remainder consisting of the effects of mode shift from car to PT in the form of decongestion benefits and PT fare revenue increases. In order to identify the impact of key parameters to the overall case a series of sensitivity tests have been carried out. Sensitivity tests carried out are:

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 Facility benefits reduced/increased by 20%  Elasticity of demand wrt GC -2 / -3;  Average travel distances reduced/increased by 20%; and  Abstraction rate from car 25% / 45%

A summary of the output benefits, costs, NPV, and PVC of these tests is shown in the table below.

Average travel Abstraction Rate Facility Benefits GC Elasticity Core distances from car -20% +20% -2 -3 -20% +20% 25% 45% User Facility Benefits 8,770 7,008 10,536 8,760 8,780 8,772 8,768 8,770 8,770 Mode Shift decongestion 3,217 2,573 3,860 2,573 3,860 2,690 3,700 2,298 4,136 and related benefits PT Fare revenue 2,626 2,101 3,151 2,101 3,151 2,742 2,519 2,626 2,626 Indirect taxes -628 -502 -754 -502 -754 -629 -627 -591 -665 Present Value of Benefits 13,984 11,179 16,793 12,931 15,037 13,575 14,360 13,102 14,866 Present Value of Costs 3,211 3,211 3,211 3,211 3,211 3,211 3,211 3,211 3,211 Net Present Value 10,773 7,968 13,582 9,720 11,826 10,364 11,149 9,891 11,655 Initial Benefit to Cost Ratio 4.35 3.48 5.23 4.03 4.68 4.23 4.47 4.08 4.63

The table shows that the initial BCR is robust to changes in input assumptions on the key parameters. The BCR remains above 4 in all cases except where facility benefits are reduced by 20%, where the BCR is 3.48, which still indicates high value for money. It is clear that the facility benefits input is the single most important input assumption, with the elasticity and abstraction from car assumptions being somewhat secondary.

6.11.2 Changes in Costs and Benefits An additional set of sensitivity tests have been carried out to identify the changes required in costs or benefits for the BCR to breach certain thresholds. The table below summarises the results of this analysis.

High Value for Medium Value Low Value for Poor Value for Threshold Money <4 for Money Money Money BCR <2 <1.5 <1 Benefit change required -8% -54% -65% -77% Cost change required 9% +118% +190% +335%

The scheme is very robust to changes in costs and benefits. Scheme cost or benefit changes of 8-9% would be required to move from the very high value for money band, while changes of 55-120% are required to move from the high value for money band. The scheme would remain medium value for money with a cost increase of less than 190% or benefits reduction of less than 65%. It should be noted that the costs include a 4% optimism bias adjustment as appropriate at this stage of scheme development.

6.12 Value for Money Statement The Initial BCR including all costs and benefits estimated following WebTAG guidance, and as detailed on the AMCB, is 4.35.

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The Adjusted BCR, including estimates for reliability, wider impacts, and highway infrastructure maintenance savings is 4.59.

Qualitative assessment is largely neutral with two slight positive impacts on regeneration and security. The overall impact on BCR is a very slight positive.

Risks reflected in the BCR include optimism bias at 4% of capital costs to account for uncertainties in cost estimates. Sensitivity tests carried out indicate that the BCR is relatively robust and remains within the high value for money band for all but one test carried out.

Adjusted BCR suggests value for money category is very high, qualitative assessments, risk assessments, and sensitivity tests do not suggest any movement from this category. Value for Money is therefore judged to be Very High.

6.13 Social and Distributional Impacts Without the spatial detail available from a fully detailed modelling system it is impossible to carry out detailed spatial analysis of benefits. Much of the impact will be dispersed in nature among users of the Metro system or users of the highway network in the Tyne and Wear area. The work carried out for Social and Distributional Impacts has therefore focused on reporting the socio-economic characteristics of particular areas relevant to the scheme in comparison with the regional and national averages.

The areas reported are:

 Newcastle Central Metro station catchment – all Census Output Areas with some part within 800m crow-fly distance of Newcastle Central (this incorporates most of the centres of Newcastle and Gateshead);  All Tyne and Wear Metro station catchments – all census Output Areas with some part within 800m of a station;  Tyne and Wear – including Gateshead, Newcastle upon Tyne, North Tyneside, South Tyneside, and Sunderland;  The North East region; and  England and Wales national average.

Vulnerable groups reported are:

 children (proportion of population aged <16);  young adults (proportion of population aged 16-25);  older people (proportion of population aged 70+);  people with a disability (self-assessed Census data on a long term (>12 months) health problem or disability that limits day-to-day activities);  people of Black and Minority Ethnic (BME) origin;  households without access to a car; and  households with dependent children.

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The data was extracted from 2011 Census data at Output Area level. Output Areas within each of the above areas were identified using GIS and data for each of the vulnerable groups was aggregated. The table shows percentages of either total population or total number of households in each area that have the characteristic of the vulnerable group identified in the column heading.

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7 Appendices

7.1 Central Metro Station refurbishment risk register, 10/06/15 The risk register is attached separately as document called “Risk register – Central Metro station as @ 10th June 2015”.

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7.2 Central Metro Station consultation feedback

7.2.1 Methodology Metro passengers and City Centre stakeholders were invited to drop in sessions to learn more about the plans for Central Station Metro.

 February 27th 2014 at the Centurian Bar, Central Station was targeted at stakeholders but open to members of the public as well.  March 4th 2014 on Central Station Metro Concourse included the handing out of leaflets to 2000 passengers during both morning and afternoon peak periods.  March 5th 2014 at Newcastle Civic Centre prior to a full council meeting gave local ward councillors and council employees the opportunity to review the plans.

In addition, local neighbouring businesses in the Central Station and Stephenson Quarter areas were visited and provided with information on the refurbishment plans and invites to the drop in sessions listed above.

Email information on the proposals were also emailed out to City Centre businesses by NE1 (Business Improvement District) through their extensive database. City-wide stakeholders were contacted via Nexus Community Relations Database for Newcastle covering over 180 contacts.

In all cases, written responses were welcomed by post or to a dedicated email address [email protected]

7.2.2 Overview of feedback by channel

7.2.2.1 Centurian Drop In Session Attendance from:

• x representatives from Elders Council • X representatives from Silverlink (developer of Stephenson quarter) • 1 x representative from Stagecoach North East • 1 x representative from the Thistle Hotel • 1 x representative from local coffee shop owner • 1 x representative from Living Streets • 1 x representative from Metro operator DB

Overall the response to the plans was positive with no negative feedback on the overall proposals for the station. Constructive feedback was provided in the following areas:

• The need for good signage from the main line station to the Metro including highlighting the travel shop within the Metro Station (from main line level) in absence of a local TIC. This feedback was provided by all representatives from the Elders Council. • A member of the Elders Council asked signage to be informative, i.e. ‘To the City Centre’ or to the ‘Stephenson Quarter’ rather than merely using street names to assist with onward travel. • A member of the elders council asked that safety and cleanliness of the floor surface should be prime concerns. • The representatives from Silverlink were very supportive of the scheme including improving future way finding signage to the Stephenson Quarter. There were some

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concerns on the impact refurbishment works on their upcoming Hotel development – these concerns will be mitigated in the planning stages.

7.2.2.2 Central Station Metro Drop in Sessions 2000 leaflets were handed out to passengers during peak commute periods with the opportunity for passengers and local stakeholders to ask questions.

Again, vocal response to the proposals was supportive with no negative feedback. In addition the following written comments were made:

• There were 3 separate comments on the importance of way finding signage especially promoting the travel shop on main line level. • There was feedback thanking Nexus for providing the session and having project managers available to answer questions.

7.2.2.3 Written Responses There were 14 individual written responses by email and 1 response by post summarised below:

• Plans look good but concerned over the reliability of the escalators, existing positioning of barriers and would like an art heritage space to show the building of the Metro station. • Would like to avoid the cross passage between platforms completely tiled in black (as Haymarket) and avoid the departure screens used at Haymarket as they are smaller and harder to read. • Feels the refurbishment plans are wasteful and only lighting needs to be improved. Would prefer Monument was done first. • Newcastle disability forum feedback that the plans look nice and a big improvement. • English Heritage has no comment to make based on the initial proposals and only need to be re-consulted if there is any material change to the proposals. • Anything that can be done to improve interchange between Metro and heavy rail will make it more attractive for intending passengers. • Newcastle Arts Centre feel the current Grainger Street Metro entrance does not invite users, is inaccessible and badly signposted. They suggest providing a lift to promote accessibility and improving way finding signage. • Real time info displays are a priority whereas branding, flooring and redecoration are low priority. • Living Streets (following the drop in visit) describe the proposals as an excellent project to compliment other improvements in the area. They support addition of the down escalator and RTI at concourse level. They have also made several comments on signage including the need for onward travel information, location of toilets, maps of local area and improved signage to the Metro station. • The Thistle Hotel is supportive of the plans and describe the proposals as good news for the City. • A member of the elders council support the proposal for a down escalator from the main concourse to Metro level. • Request to add live Metro information at ticket machine level (actually included in the plans) and moving the train arrivals/departures screen at main line level to metro concourse level. • Replacing the information displays on platforms will ensure more modern displays will be less prone to error and fault. Information on the newer screens at Haymarket is clearer and easier to understand for poorly sighted people.

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• A passenger writes in detailed support of the proposals including supporting the down escalator proposal from the main station (and adding a set of stairs be retained as well),the tactile paving, dual handrails, raising the suspended ceiling and raising the canopy over platform level – supportive of all elements of the scheme. • Request for catering vending machines at concourse level. • A passenger writes in support of the plans generally but asks the yellow ‘M’ cubes be lit at all City Centre stations as a means of easier identification.

7.2.3 Summary of all feedback Overall the feedback received was overwhelmingly positive with additional constructive feedback provided.

Of the 29 responses (either written or in person), 27 were broadly supportive of the proposals, one was neutral and one was negative.

The issue of most concern is based around signage having been mentioned by ten separate respondents, both way-finding signage for onward travel and also highlighting the availability of the travel shop outside of the footprint of the Metro station.

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7.3 Central Metro Station construction costs breakdown The detailed cost breakdown provided by the preferred contractor is attached separately as document called “Construction cost breakdown – Central Metro station”.

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7.4 Economic Case Appraisal Summary Table (AST) Impacts Summary of key impacts Assessment Qualitative Monetary Distributional Quantitative 7-pt scale/ £(NPV) vulnerable grp Business users Mode shift effects of scheme lead to highway Value of journey time changes(£) Net journey time changes (£) & transport decongestion benefits of £1.06m and PT operator revenue £3.69m 0 to 2min 2 to 5min > 5min providers increase of £2.62m

Reliability Mode shift effects of scheme lead to increased highway impact on £0.16m journey time reliability

Economy Business users

scheme supports local regeneration in immediate area slight Regeneration and Newcastle city centre positive Wider Impacts Estimated as 10% of total user benefits £0.30m Mode shift effects of scheme lead to small benefit of Noise £0.01m £0.01m Air Quality No significant impact £0.00m Greenhouse Mode shift effects of scheme lead to small reduction in Change in non-traded carbon over £0.03m gases emissions Change in traded carbon over 60y Landscape in urban area neutral the station is largely underground but there are Townscape opportunities to design entrance treatments to give neutral neutral/slight positive impact

the station is largely underground but the immedaite area Environmental has a number of historic and listed buildings, not least Historic Newcastle Central station itself. There is an opportunity neutral Environment to ensure that the design is sympathetic and has a neutral/slight positive impact Biodiversity assumed neutral neutral Water assumed neutral neutral Environment Commuting Value of journey time changes(£) Mode shift effects of scheme lead to highway Net journey time changes (£) and Other £1.94m decongestion benefits of £1.94m 0 to 2min 2 to 5min > 5min users Reliability impact on Mode shift effects of scheme lead to increased highway Commuting £0.29m journey time reliability and Other users Physical no significant impact neutral activity large facility / journey quality benefits for all users of Journey quality Newscastle Central Metro station, estimated at 7.3p per £8.77m

Social trip (2010 prices) leads to benefits of £8.77m Mode shift effects of scheme lead to reduction in highway Accidents £0.17m accidents small security improvement due to lighting and layout slight Security improvements for a >5m passengers per annum positive Access to no impact as no change in transport service provision neutral services Affordability no impact as no change in transport costs neutral Severance no impact neutral Option and non-use no impact as no additional service provided neutral values Cost to Broad scheme capital costs of £2.22m, with renewal costs of Transport £0.99m. Assumed no change in operating and £3.21m Budget maintenance costs Reduction in indirect tax revenues due to both reduction in Indirect Tax fuel duty and increase in spending on (zero-rated) PT £0.63m Revenues Public Accounts fares. (NB positive number = cost)

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7.5 Nexus Project team CVs

7.5.1 Brian Wilson BSc (Hons) DipEM CEng MICE Experience Summary

I have wide experience of technical and commercial responsibility for civil engineering, architectural and railway projects. I am experienced in the design of a wide variety of drainage, infrastructure, industrial and marine works, including light railway station works, heavy civil engineering structures for the mining and steel industries, land reclamation, remediation of contaminated sites, environmental statements, infrastructure for new and existing developments, quay walls and revetments.This work has been for a variety of clients including private individuals, local councils, government agencies and public companies and has involved all aspects of site assessment including dealing with listed buildings and historic structures.

Professional History

2009 – present: Head of Engineering, Tyne and Wear Passenger Transport Executive (Nexus).

Nexus is the owner of the Tyne and Wear Metro System and in my current role I am responsible for the production, implementation and maintenance of engineering standards for the System, scoping of the Nexus 11 year Asset Renewal Plan (£385m) including prioritisation of asset renewals and acting as “Client”. I report directly to a main board director and manage a team of discipline specific engineers whose areas of expertise include Permanent Way, Signalling, and Mechanical and Electrical installations. I am a member of various internal committees charged with the safe running and refurbishment of the Tyne and Wear Metro System. I am directly responsible for a total of 16 staff plus the management of 3 framework consultant organisations.

2006 – 2009: Renewals Group Manager, Tyne and Wear Passenger Transport Executive (Nexus)

I started my Employment with Nexus in this role which covered technical and commercial responsibility for delivery of civil engineering and building projects delivered under the Tyne and Wear Metro Capital Plan. Responsible to the Projects Director, I headed a department of 8 staff plus several external consultant organisations. Projects included the re- building of Haymarket Metro station in Newcastle (£20m), construction of the new Simonside Metro station (4m) as well as bridge repair and refurbishment projects and Metro Depot refurbishments.

1997 – 2006: Regional Director: (AECOM/Faber Maunsell/Bullen Consultants Limited)

During this period I had technical and commercial responsibility for delivery of development infrastructure projects throughout North East England and was also a member of the North East Board of Bullen Consultants Limited. As Regional Director I managed and supervised the design teams, ensuring that resources were correctly allocated, company procedures were followed and that design documents and contract correspondence were checked prior to issue. I undertook final review and approval of all significant documents produced within my teams.

Significant projects worked on during this period included the Royal Quays development in North Tyneside (£60m), Monkton Cokeworks Reclamation in South Tyneside (£6m), Reclamation of the Darchem factory site in Darlington and the formation of the West Park Development (£4m) Darlington, Reclamation of Lambton Cokeworks (£20m) and infrastructure works at Newcastle Great Park and Seaham docks.

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1995 - 1997: Principal Engineer: (AECOM/Faber Maunsell/Bullen Consultants Limited)

With overall responsibility for infrastructure works at Royal Quays but with an expanded role encompassing projects for other clients including land reclamation and feasibility studies. I managed a team of 8 engineers and technicians within the office and worked closely with site based teams on the design and construction of numerous infrastructure packages including land reclamation, residential highway and drainage construction and quay walls. I prepared designs, produced contract documents on behalf of clients, attended site meetings to discuss and agree both technical and commercial matters.

1991 – 1995: Senior Engineer: (AECOM/Faber Maunsell/Bullen Consultants Limited)

Design team leader for infrastructure packages at the Royal Quays development site, North Tyneside. This was a £200m development on disused dockland promoted by Tyne and Wear Development Corporation. The infrastructure element was worth £60m. Having prepared the feasibility study for the site whilst with Mason Pittendrigh (see below), I was well placed to understand the site constraints and the degree of contamination on the site. Using this knowledge I designed all the retaining wall structures for the public open spaces and worked closely with a landscape architect to create two public parks within the site. I worked exclusively on infrastructure projects for this development during the period. The variety of work required on this single site was significant and gave me a firm grounding in the design and construction of development infrastructure as well exposure to listed buildings, marine work and land reclamation. This was one of the flagship schemes for the Tyne and Wear Development Corporation and is currently a very successful mixed use development.

1984 – 1991: Civil Engineer, Mason Pittendrigh Ltd, Consulting Engineers

Assistant Resident Engineer on the construction of 3 no. new stations on the Tyne and Wear Metro system. These stations were constructed after the opening of the Metro system. As such I became familiar with carrying out construction work on an operational railway. Experience which I still call upon today. My role included checking setting out, preparing interim valuations and taking control of the line during engineering hours. In addition I prepared designs for various structural and infrastructure projects including heavy foundations and structures for mining projects as well as commercial and residential developments. I gained experience in contract preparation and contract management and the preparation of development studies for derelict sites.

Academic Training

 BSc (Hons) Civil Engineering, Sheffield Hallam University 1984  Chartered Engineer (MICE) 1989  Diploma in Engineering Management (DipEM) from the University of Bristol, 2003  ICE registered Supervising Civil Engineer

Project Experience Includes:

Light Railways

Currently overall Client sponsor for £385m 11 year Tyne and Wear Metro reinvigoration programme including station refurbishments, track renewals, communication systems, structures and earthworks. Delivered via a team of discipline specific engineers and project managers.

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Client Project Manager for Simonside (£3m) and Haymarket (£8m) Metro Stations and various bridge refurbishment works. Managing both external consultants and internal staff.

Worked extensively on track infrastructure along an existing operational British Rail corridor between Canning Town and Stratford for the Jubilee Line Extension. Undertook track formation and drainage design, assessed existing structures with regard to clearances and costs for renewal or upgrading and prepared budget estimates.

Tyne and Wear Metro System:

Assistant Resident Engineer, engaged on the construction of new stations. Responsible for checking setting out measurement and supervising works adjacent to operational railways.

Land Reclamation

 Royal Quays development site, North Tyneside. Preparation of initial feasibility study and recommendations followed by a phased approach to infrastructure design to bring a 90 ha. Derelict dockland site back into full use over a 10 year period. (£60m infrastructure). A flagship project for Tyne and Wear Development Corporation  Monkton Business Park, South Tyneside. Reclamation of a contaminated cokeworks site and installation of infrastructure for a new business park and creation of public open space (£6m). One of the first schemes to be completed under the Government’s coalfield Regeneration Programme  West Park, Darlington. Reclamation of a former chemical works to create new housing and a public park (£4m).  Lambton Cokeworks, Sunderland. Reclamation of a highly contaminated site for housing and public open space. (£20m)

Development Studies

 Royal Quays North Tyneside, 90 ha.  Lambton Cokeworks, South Tyneside, 20 ha.  West Park, Darlington, 25 ha.  Industrial Land, Haltwhistle, 10 ha.  Industrial Land, Low Prudhoe, 10 ha.  Cramlington Bio-tech Park, 7 ha.  Ashington Learning Park.  North Seaton Business Park, 60 ha.  Egger Factory, Hexham, 12 ha.  Haulage depot, Murton, Co Durham, 8 ha.

Development Infrastructure

 Royal Quays Development, North Tyneside. Consultant’s Project Manager responsible for design and contract preparation of £30m of infrastructure including roads, drainage, retaining walls, public open space and car parks.  Monkton Business Park.(£4m) Consultant’s Project Manager for installation of new access roads and drainage including sustainable drainage systems.  Newcastle Great Park. Project Manager for design of internal infrastructure and accesses including sustainable drainage.

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 North Seaton Business Park, Northumberland. Project Manager for design of roads and drainage including new roundabout access of A189 and surface water outfalls.  West Park, Darlington.(£3m) Project Manager for design of on-site sustainable drainage system and new site accesses, together with detailed design of housing infrastructure.  Newcastle Shopping Park. Project Manager for design of external works including car parks, accesses, S278 Works and service yards.  Caterpillar, Peterlee. Project Manager for construction of new perimeter vehicle testing road within the existing factory premises. Involved very close liaison with client to maintain working areas.

Historic/Listed Structures

 Albert Edward Dock, North Tyneside. Construction of new lock gates and tidal barrier within the existing listed dock walls.  Albert Edward Dock, North Tyneside. Refurbishment of existing listed hydraulic accumulator tower.  Consett Park. Civil engineering advice, paving and drainage designs to Landscape Architect regarding refurbishment of a historic Victorian park.  Leazes Park, Newcastle. Civil engineering advice, paving and drainage design for refurbishment of a Victorian park.

Public Art

 Tyne Anew, North Tyneside. Structural advice, foundation design and site preparation for a steel sculpture manufactured in the United States and erected in North Tyneside.  Weather Clock, North Tyneside. Structural advice and foundation design for creation of a large public clock within a shopping centre.  Bee Hive, Monkton, South Tynside. Structural and fabrication advice, foundation design and site preparation for public art at Monkton Business Park entrance.

Affiliations:

 Member of the Institution of Civil Engineers No. 45476025

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7.5.2 Stuart Clarke MSc BEng (Hons) MIET Experience Summary

Experienced Group Project Manager with project delivery, commercial and management responsibility for overseeing the delivery of in excess of £25m of light rail projects.

Professional History

2012 – Present; Project Group Manager (E&M), Nexus

Responsible for the production, implementation and maintenance of engineering standards for the System, scoping of the Nexus 11 year Asset Renewal Plan (£385m) including prioritisation of asset renewals and acting as “Client”,

Report directly to a main board director and manage a team of discipline specific engineers whose areas of expertise include Permanent Way, Signalling, and Mechanical and Electrical installations.

2010 – 2012; Project Manager (E&M) Nexus

Technical and commercial responsibility for delivery of civil engineering and building projects delivered under the Tyne and Wear Metro Capital Plan,

Projects included the re- building of Haymarket Metro station in Newcastle (£20m), construction of the new Simonside Metro station (4m) as well as bridge repair and refurbishment projects and Metro Depot refurbishments.

2007 – 2010; Project Engineer (E&M), Nexus

Technical and commercial responsibility for delivery of development infrastructure projects throughout North East England,

Managed and supervised the design teams, ensuring that resources were correctly allocated, company procedures were followed and that design documents and contract correspondence were checked prior to issue. I undertook final review and approval of all significant documents produced within my teams.

Significant projects worked on during this period included the Royal Quays development in North Tyneside (£60m), Monkton Cokeworks Reclamation in South Tyneside (£6m), Reclamation of the Darchem factory site in Darlington and the formation of the West Park Development (£4m) Darlington, Reclamation of Lambton Cokeworks (£20m) and infrastructure works at Newcastle Great Park and Seaham docks.

2005 – 2007; Project Supervisor (E&M), Nexus

Overall responsibility for infrastructure works at Royal Quays, with an expanded role encompassing projects for other clients including land reclamation and feasibility studies,

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Managed a team of 8 engineers and technicians within the office and worked closely with site based teams on the design and construction of numerous infrastructure packages including land reclamation, residential highway and drainage construction and quay walls,

Prepared designs, produced contract documents on behalf of clients, attended site meetings to discuss and agree both technical and commercial matters.

2001 – 2005; Electrician, Nexus

Team leader for infrastructure packages at the Royal Quays development site, North Tyneside. This was a £200m development on disused dockland promoted by Tyne and Wear Development Corporation. The infrastructure element was worth £60m. Having prepared the feasibility study for the site whilst with Mason Pittendrigh (see below), I was well placed to understand the site constraints and the degree of contamination on the site. Using this knowledge I designed all the retaining wall structures for the public open spaces and worked closely with a landscape architect to create two public parks within the site. I worked exclusively on infrastructure projects for this development during the period. The variety of work required on this single site was significant and gave me a firm grounding in the design and construction of development infrastructure as well exposure to listed buildings, marine work and land reclamation. This was one of the flagship schemes for the Tyne and Wear Development Corporation and is currently a very successful mixed use development.

1984 – 1991; Civil Engineer, Mason Pittendrigh Ltd, Consulting Engineers

Assistant Resident Engineer on the construction of 3 no. new stations on the Tyne and Wear Metro system. These stations were constructed after the opening of the Metro system. As such I became familiar with carrying out construction work on an operational railway. Experience which I still call upon today. My role included checking setting out, preparing interim valuations and taking control of the line during engineering hours. In addition I prepared designs for various structural and infrastructure projects including heavy foundations and structures for mining projects as well as commercial and residential developments. I gained experience in contract preparation and contract management and the preparation of development studies for derelict sites.

Academic Training

 MSc Project Management  BEng (Hons) Electrical and Electronic Engineering  BTEC HNC Electrical and Electronic Engineering  BTEC ONC Electrical and Electronic Engineering  NVQ Level 3 Engineering Maintenance  ILM Level 3 Certificate in Effective Management  IOSH Certificate in Managing Safely

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7.5.3 Mark Whitaker MSc BEng (Hons) Professional History

September 2008 – Present; Project Manager (Electrical & Mechanical), Nexus

Experience gained within the Plant (Buildings & Facilities) department, looking after station lifts, escalators, fire detection and electrical systems. Responsibilities included writing and issuing tender documents in accordance with company policy, managing contractors and implementation of small projects and managing the quality of the documentation and records available. As part of my work in this department, I have also taken a lift and escalator monitoring system and driven it forward to a point where it is now useable and reliable, something that has never previously been achieved with the system.

Further experience has then been gained as a Project Manager within the Renewals department, as part of a team delivering £389m across 9 years. The project management experience gained has improved my budget, time and personnel management skills.

The projects I have delivered include new depot plant equipment (train wash and wheel lathe), which have been successfully delivered against the backdrop of budgetary pressures and at times difficult contractual positions. Intensive contractor management was required at times to ensure programme and objectives were maintained.

I have also worked on station refurbishment projects, which have at times been complex to manage and encountered late design changes and site issues due to the extent of activities requiring excavations. This was experience of the management of intensive projects with a significant amount of contractual experience gained.

Throughout my time at Nexus, I have also gained experience in the appreciation of systems required to run an operational railway safely and efficiently and how to manage problems when they do occur with such systems.

July 2000 – Present; Volunteer fitter, locomotive driver & permanent way technician at the Middleton Railway, Leeds.

This involves working in an extensive workshop comprising a large collection of metalworking machines to restore steam and diesel locomotives. Problem solving and component design skills are often used in the restoration of locomotives, as well as the knowledge and ability to manufacture and fit components.

I am also involved the operational side of the railway as a steam and diesel locomotive driver and my involvement with the permanent way work on the railway, which includes inspection, repair and renewal of the track.

I have gained valuable experience in making my own decisions in both workshops and out on site and I have experienced first hand how tasks are conducted in a real engineering environment.

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The railway has recently undertaken a re-development of the site, which involved groups of people from several different companies working on the site at the same time. I have learnt how to work with other companies that rely on my work to be accurate and timely in order to progress their work, as well as giving them the appropriate guidance where gaps within their knowledge exists.

Education

 MSc Professional Engineering; a distance learning course. Modules include business practice and new technology and project management studies. The course also develops independent learning skills and teaches how to practice continuing professional development. September 2009 – Present; Northumbria University  BEng (Hons) in Mechanical Engineering, grade 2:1. Modules included machine design, material science, manufacturing technology and a comprehensive module on engineering the railway business. The course also incorporated laboratories on engines and systems and has involved projects using advanced 3D CAD systems and working in groups of people to solve problems and produce design solutions. My third year project involved me teaching myself and using a leading railway vehicle dynamics software package, Vampire. September 2005 – July 2008; Newcastle University  A-Levels at Woodkirk High School, Leeds - Chemistry C, Physics C, Maths C. September 2003 – July 2005;  Woodkirk High School, Leeds; 8 GCSEs Grade As, including Maths, Co-ordinated Science and English. GNVQ at Woodkirk High School, Leeds; Distinction level achieved in ICT. September 1998 – July 2003.

Achievements

Whilst at high school I took part in maths challenges for three consecutive years, achieving ‘Best in School’ at the age of 15. I have also achieved success for school football and rugby teams, playing both sports for 5 years. Outside of school I attained player of the year for my local Sunday league football team that I played with for 7 years. Participating in these sports has developed my teamwork skills with large numbers of people. I successfully completed the 2007 Great North Run and aspire to complete many more in the future.

I was nominated and short-listed for an award at the annual Nexus staff awards in March 2010 as well as a national award for the transport industry in November 2010. I was also part of the team that won ‘Team of the Year’ award at Nexus annual staff awards in March 2012.

Interests

I have an interest in sports and find myself wishing to play more sports although I do not have enough free time to commit to a team. I have an interest in music, ranging from DJ-ing in my spare time to going to live performances. I also enjoy cycling and skiing with friends. I have an interest in general engineering as well as specifically with the railway sector; I am an

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associate member of the Institute of Mechanical Engineers and read the publications available as a member.

Other Skills

I currently hold a full, clean UK driving licence. I am experienced at using computer software, especially CAD programs and Microsoft Office software. I have also attended a basic first aid training course and completed an IOSH Managing Safely Course. I am an assertive person, demonstrating leadership and management skills on a daily basis. I am very keen on meeting new people and I enjoy learning new things. I can usually adapt to rapidly changing situations and have a great commitment to completing a task efficiently, punctually and to a very high standard.

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