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PDF-Longform Advisory Report to the Public Accounts Committee of the Budget Committee of German Parliament Pursuant to Article 88 (2) Federal Budget Code on planning a new Fehmarn Sound link This report by the German SAI is protected by copyright. The report is published on the web page of the German SAI (www.bundesrechnungshof.de). Ref.: V 4 - 2016 - 0831 Potsdam, 11 April 2016 2 Contents Page 0 Summary ........................................................................................... 3 1 Existing Fehmarn Sound Bridge ......................................................... 7 1.1 Description of the structure .............................................................. 7 1.2 Distribution of costs for maintenance and repair .................................. 8 1.3 Progressing maintenance backlog ...................................................... 8 1.4 Load carrying capacity verification of the Fehmarn Sound Bridge........... 9 2 Selection of an option ...................................................................... 10 3 Assessment made by the German SAI ............................................. 11 3.1 Maintenance backlog and funding .................................................... 11 3.2 Selection of an option .................................................................... 12 4 Statements of the Federal Ministry of Transport and Digital Infrastructure and the Deutsche Bahn AG (German Railways) .............. 13 4.1 Maintenance backlog and funding .................................................... 13 4.2 Selection of an option .................................................................... 14 5 Conclusion ....................................................................................... 15 5.1 Maintenance backlog and funding .................................................... 16 5.2 Selection of an option .................................................................... 17 3 0 Summary The island of Fehmarn in the Baltic Sea is connected to the German mainland by a road and rail bridge crossing the Fehmarn Sound. As part of the Fehmarn Belt fixed link project, the Federal Ministry of Transport and Digital Infrastructure intends to decommission the existing Fehmarn Sound Bridge and replace it by a new bridge or tunnel. By the end of September 2015, the Ministry reported on this issue to the Public Accounts Committee, a subcommittee of German Parliament’s Budget Committee. The Public Accounts Committee took note of the report and requested the Ministry to provide a justification for selecting a definite option until 30 August 2016. Among many options for new bridges or tunnels, one option focuses on repairing the existing bridge as it stands. Jointly with our field offices in Hamburg and Stuttgart, we looked into the documents on which the Ministry based its selection. The Ministry and the German Railways company were requested to submit their comments. To do so they also submitted new documents. In the present audit report, we have taken their comments into account. The report also informs about the condition of the existing bridge. 0.1 The Ministry’s report as of September 2015 was based on incomplete and little convincing documents, some of which were drafts. Moreover, the final deliberations between the Ministry, German Railways and the road construction authority of the federal state of Schleswig-Holstein took place in November 2015 only, i.e. after submission of the report to the Public Accounts Committee. The Ministry’s report refers for the most part to a document that does not comply with the requirements set by the Federal Ministry of Finance. The Ministry and the German Railways developed supplementing documents only upon our specific request. We believe that at that current stage of the project the Ministry should not discard any options merely on the basis of the studies the Ministry has conducted so far. The Ministry may make better use of the time left until 30 August 2016 to carry out any supplementary studies needed without delay. (No. 5) 0.2 The Ministry's documents are not very meaningful in view of the following points: The capital expenditure appraisal is mainly based on a spreadsheet supplemented by some comments and is therefore little transparent. Sources of key input variables have not been cited. In our opinion, the Ministry and German Railways used inappropriate approaches. They included maintenance costs only in such options which, in a first step, provided for retrofitting the existing bridge. However, maintenance work needs to be performed in the short term for all options. 4 The Ministry and German Railways did not adequately document the utility analysis. Nor did they explain the assessment criteria they used. Moreover, such criteria were blurred and ambiguous. We found duplicate assessments since individual requirements such as accessibility to the island during construction were covered by several criteria. Furthermore, the utility analysis does not comply with the requirements set by the Federal Ministry of Finance. German Railways calculated the utility values of monetary criteria already included in or arrived at in the capital expenditure appraisal. According to the requirements set by the Federal Ministry of Finance, such values must not be used again in a utility analysis. In an effort to remedy this shortcoming, the Ministry and German Railways submitted modified documents. As the supplement was a mere display of results, the German SAI was not able to derive reliable conclusions from the data provided. The results of the capital expenditure appraisal show that option ‘A’ ranks in second place: This option provides for retrofitting the existing bridge with regard to road traffic and constructing a new bridge for rail transport. According to the utility analysis conducted by the Ministry and German Railways, option ‘A’ ranks in fifth place only. Applicable requirements set by the Federal Ministry of Finance stipulate that detailed justifications are needed in cases where the ranking changes significantly. Such a justification is lacking. (No. 3.2) 0.3 At present, the Fehmarn Sound Bridge is in a bad condition. We believe that German Railways and the Federal Government, represented by the road construction authority of the federal state of Schleswig-Holstein, have neglected their duty for proper maintenance for decades. Since 2000, corrosion damage identified on the bridge has not been removed by German Railways. As a result, such damage deteriorated and led to consequential damage. In 2012, German Railways stated that maintenance and repair costs amounted to €21 million (around three quarters of which were needed for protection against corrosion). In our opinion, a large portion of this amount needs to be invested in the short term in order to prevent additional traffic restrictions regarding the Fehmarn Sound Bridge. (No. 3.1) 0.4 The Ministry and German Railways denied that they had neglected their duty for proper maintenance. In addition to that, the Ministry and German Railways wish to invest merely €8 million in maintenance because they are of the opinion that the existing bridge will be replaced by new structures by 2028. In their view, urgent corrosion protection works are to start in 2017, once worn out suspension ropes have been replaced. The Ministry and German Railways argue that the capital expenditure appraisal may be based on lower maintenance costs. They stated that extensive maintenance work was only needed if the existing bridge was to 5 be strengthened for a continued use. According to the Ministry and German Railways, the comments on the capital expenditure appraisal were concise, but sufficient, since all calculations were disclosed in the spreadsheet. The Ministry and German Railways confirmed that they had assessed the remaining useful life of the existing bridge to be 30 years. This parameter was included in the static verifications as part of bridge design appraisal and the analyses underlying the selection of a final option in accordance with applicable federal regulations. The Ministry and the German Railways believe that a longer remaining useful life would reduce the efficiency of option ‘A’ compared to the options aiming at a new construction of the bridge, because of the increased need for maintenance work. However, they did not provide any evidence to back their argument. The Ministry and German Railways underlined that the methods underlying the utility analysis, which were pointed up by the German SAI, had been agreed upon with the federal railway authority and the road construction authority. In particular, German Railways believed that a utility analysis served best to combine both qualitative and quantitative aspects. The Ministry and German Railways further stated that they considered accessibility to the island during construction the key criterion. Since that requirement was not met in option ‘A’, this option could be discarded as planning proceeded. (No. 4) 0.5 We are not convinced by the argumentation of the Ministry and German Railways. They do not use the results of their studies in a way that is compliant with the requirements for capital expenditure appraisals set by the Federal Ministry of Finance. An option is to be selected on the basis of both a utility analysis and capital expenditure appraisal. However, the Ministry and German Railways base their decision exclusively on the results of a utility analysis relying on disputable methods. German Railways failed to provide evidence that they had made
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