M25 and M26 Economic Case Study

M25 M26 Connectivity 21/06/2016 Reference number 103712 ECONOMIC CASE STUDY FINAL REPORT M25 M26 CONNECTIVITY ECONOMIC CASE STUDY IDENTIFICATION TABLE Client/Project Kent County Council owner Project M25 M26 Connectivity Study Economic Case Study Type of document Final Report Date 21/06/2016 File name M25M26 Report 2c (final).docx Reference number 103712 Number of pages 83 APPROVAL Version Name Date Modifications Ian Wilkinson, Author 07/04/2016 John Stephens Ian Wilkinson, 1 Checked by 07/04/2016 Version 1 Draft for client David Carter consideration Approved David Carter 07/04/2016 by Ian Wilkinson, Version 2 Report including client Author John Stephens, 21/06/2016 feedback: incorporating minor expansion on reporting of scheme David Carter costs, wider consideration of Ian Wilkinson, GIF/SHMA issues and dependent Checked by 21/06/2016 David Carter housing case, as well as minor 2c drafting points Version 2a/b including a few further snagging corrections and other minor Approved changes David Carter 21/06/2016 by Version 2c incorporating final comments from KCC and the study working group TABLE OF CONTENTS SUMMARY 6 BACKGROUND AND EXISTING STUDIES 6 HIGHWAY MODEL REVIEW 6 HIGHWAY OUTCOMES 7 WIDER ECONOMIC BENEFITS 10 OVERALL VALUE FOR MONEY CASE 10 LOCAL STAKEHOLDER CONSULTATION 11 CONCLUSIONS 12 1. INTRODUCTION 14 1.1 OVERVIEW 14 1.2 BACKGROUND PROVIDED BY KENT COUNTY COUNCIL (WITH SOME MINOR ADAPTATION) 15 1.3 DATA PROVISION 18 2. QUALITATIVE REVIEW 22 2.1 POLICY CONTEXT 22 2.2 ECONOMIC/VALUE FOR MONEY CASE AND WIDER BUSINESS CASE DELIVERY 23 3. HIGHWAY MODEL REVIEW 26 3.1 INTRODUCTION AND MODEL ROBUSTNESS 26 3.2 HIGHWAY MODEL REVIEW AND ACTIONS 26 3.3 HIGHWAY MODEL VALIDATION 30 4. ECONOMIC APPRAISAL 33 4.1 INTRODUCTION 33 4.2 HIGHWAY MODEL RESULTS AND INTERPRETATION 34 4.3 ECONOMIC ‘TUBA’ APPRAISAL 35 4.4 OUTCOMES OF HIGHWAY MODEL ACTIONS 36 4.5 SCHEME IMPACT OF OPTION 1A – JUNCTION 5 EAST-FACING SLIPS 38 4.6 SCHEME IMPACT OF OPTION 2C – A225 OTFORD SLIPS 41 4.7 FURTHER ANALYSIS OF OPTION 1A AND 2C 41 4.8 OUTCOMES OF HIGHWAY MODEL AND TUBA SENSITIVITY TESTS 46 4.9 ECONOMIC ANALYSIS OF OPTION 2C 47 M25 M26 Connectivity Economic Case Study 103712 Final Report 21/06/2016 Page 3/83 4.10 QUANTIFICATION AND MONETISATION OF OTHER BENEFITS 47 5. WIDER ECONOMIC BENEFITS 52 5.1 INTRODUCTION 52 5.2 LAND USE BENEFITS FROM RESIDENTIAL DEVELOPMENT 52 6. OVERALL VALUE FOR MONEY CASE 69 6.1 WEBTAG APPRAISAL TABLE 69 7. LOCAL STAKEHOLDER CONSULTATION 72 7.1 BACKGROUND 72 7.2 KEY FINDINGS 73 7.3 GENERAL COMMENTS 75 7.4 SUMMARY 75 8. CONCLUSIONS 72 APPENDIX A: ANALYSIS OF LABOUR MARKET INTEGRATION 79 APPENDIX B: TEE, PUBLIC ACCOUNTS AND AMCB TABLES 82 M25 M26 Connectivity Economic Case Study 103712 Final Report 21/06/2016 Page 4/83 LIST OF FIGURES Figure 1. Flow Difference Due to Option 1A (2031 PM) (Full Model) 38 Figure 2. Flow Difference Due to Option 1A (2031 PM) (Zoomed) 39 Figure 3. Flow Difference Due to Option 1A (2031 PM) (Google Image) 39 Figure 4. Flow Difference Due to Option 1A (2031 PM) (Indicative Diagram of Key Impacts) 40 Figure 5. Flow Difference Due to Option 2C (2031 PM) (Zoomed) 41 Figure 6. Delay per Vehicle (seconds) Difference Due to Option 1A (2031 PM) (Zoomed) 43 Figure 7. Sector System 45 Figure 8. Sector based analysis of change in travel time Option 1A (2031 PM) (seconds) 45 Figure 9. WebTAG Appraisal Summary Table Template 69 LIST OF TABLES Table 1. Condensed Appraisal Summary Table 11 Table 2. PB 2009 Study - Summary of Economic Assessment of M25 Junction 5 – Option 1A 20 Table 3. PB 2009 Study - Qualitative Appraisal of Option 1A 21 Table 4. Qualitative Summary of Potential Benefits and Impacts – Initial Review 25 Table 5. Highway Model PM Peak Matrices Sizes and Growth 27 Table 6. Comparison of Observed and Model Vehicle Flow (PM Peak Hour) 31 Table 7. Comparison of Observed and Model Vehicle Speed (PM Peak Hour) 32 Table 8. Summary of AMCB Results – Model Improvement 37 Table 9. Change in Traffic Flow on A25 (2031 PM Peak) (ALL VEHICLES) 42 Table 10. Change in Traffic Flow on A25 (2031 PM Peak) (CARS) 42 Table 11. Change in Traffic Flow on A25 (2031 PM Peak) (HGVs) 42 Table 12. Change in Traffic Flow on A225 Otford Road (2031 PM Peak) 43 Table 13. Change in EASTBOUND Travel Time on A25 (2031 PM Peak) (SECONDS) 44 Table 14. Change in WESTBOUND Travel Time on A25 (2031 PM Peak) (SECONDS) 44 Table 15. Summary of AMCB Results – Sensitivity Tests 47 Table 16. Summary of AMCB Results – Option 2C 47 Table 17. Global Change in Travel Distance (2031) (Vehicle Kilometres) 48 Table 18. Global Change in Travel Time (Vehicle Hours) 48 Table 19. Change in Traffic Flow on A25 (2031 PM Peak) 49 Table 20. Change in Traffic Flow on A225 Otford Road (2031 PM Peak) (HGVs) 49 Table 21. Travel Time on A25 (2031 PM Peak) (SECONDS) 49 Table 22. Accident Assessment 51 Table 23. Actual less predicted trips, separate urban and rural variables 64 Table 24. Sum of actual less predicted trips relative to working age population 65 Table 25. Propensity to travel to London, Surrey and Rest of South East 66 Table 26. Analysis of travel to work data 68 Table 27. Appraisal Summary Table (Part 1) 70 Table 28. Appraisal Summary Table (Part 2) 71 Table 29. Responding Parish & Town Councils Consultees 72 Appendix Table A 1: occupations of residents 80 Appendix Table A 2: qualifications and earnings of residents 80 Appendix Table A 3: workplace earnings and employment structure 81 M25 M26 Connectivity Economic Case Study 103712 Final Report 21/06/2016 Page 5/83 SUMMARY This summary reports the main tasks and outcomes for each part of the study. The headings reflect the report chapters which themselves are related to the Tasks in the study tender documents and the technical proposal. This study should be treated as confidential. Background and Existing Studies Kent County Council (KCC), Tonbridge & Malling Borough Council (TMBC) and Kent Association of Local Councils (KALC) required the provision of consultancy services to establish whether a robust economic case can be made for new east facing slip roads at an appropriate location in the vicinity of Junction 5 of the M25/M26 to improve connectivity to West Kent and provide congestion relief and wider benefits. The previous study in 2009 by Parsons Brinckerhoff (PB) considered the potential economic benefits of improved transport connectivity by using a cut-out or cordoned version of the Highway Agency’s (now Highways England) M25 SATURN Highway Model and the Department for Transport’s (DfT) Transport User Benefit Analysis (TUBA) software to assess the economic case. This approach identified transport user benefits, largely time savings that could be valued, which when set alongside the scheme costs generated a monetised BCR (Benefit to Cost Ratio) of 2.23. The current study provides a detailed review and, where possible, an update of the elements of the earlier PB model and the associated economic TUBA assessment. We have also considered a number of further qualitative and quantitative analyses and undertaken an assessment of the potential wider economic benefits, including residential development benefits, direct employment benefits and the scope for greater labour market integration. Highway Model Review In accordance with Department for Transport good practice, as set out in the WebTAG guidance, we have attempted to ensure the robustness of the transport model and economic analysis outputs. However, we need to acknowledge that the modelling tools available to us have their limitations, in part due to the age of the models, but more importantly due to their coverage which is limited in the area to the area west of the A21 and Sevenoaks. Our work has included detailed reviews and improvements of the cordoned (SATURN) highway network model with sensitivity tests where appropriate, including: assignment parameters including values of time and fuel and model convergence; accuracy of model flows and travel times; inclusion of inter-peak and AM peak models; realism of the routes and locations (origins and destinations) experiencing congestion. The review of the underlying model identified a number of enhancements and corrections to the model, including improved model convergence, improved representation of time periods (expanding from PM peak only to other periods) and a small but significant correction to the representation of network distances. In addition to using the highway model with its pre-existing representation of the east-facing slip roads at the A21/M25/M26 intersection (Option 1A), we have coded a representation of slip roads at M25 M26 Connectivity Economic Case Study 103712 Final Report 21/06/2016 Page 6/83 the A225 at Otford (Option 2C). This has allowed us to consider the potential differences in traffic impacts between the (strategic accesses) onto the A21 and the (more localised access) to the A225. As the underlying model does not cover the area to the west of the A21 we have not been able to quantify the potential traffic impacts of the option of east-facing slip roads near Westerham. Highway Outcomes Following the review of the underlying model and resulting enhancements and corrections, the forecasting model and DfT TUBA software were used to estimate the transport benefits of the slip road options. The benefit estimates are primarily driven by the highway outcomes, with re-routeing of traffic and journey time savings generating key economic benefits. At a headline level, the slip road options fill a broadly 18 miles gap in junctions for M26 users between M26 J2A at Wrotham and M25 J6 at Godstone, allowing eastbound access and westbound egress to and from the M26 around Sevenoaks.

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