A report for the Trustees of the Science Museum Group into the restoration of A3 Class Pacific Flying Scotsman and associated engineering project management. Researched and written by Robert Meanley Assisted by Roger Kemp 26 October 2012 Page 1 of 29 1. Executive summary Locomotive 4472 Flying Scotsman was purchased for the nation in April 2004 at a cost of £2.3m by the National Railway Museum (NRM) a, through a sealed-bid auction process. It ran intermittently until December 2005 at which point it was withdrawn from traffic to undergo a major overhaul. The original objective was for the repair to last 1 year and cost about £750k. This proved to be over-optimistic with the work still unfinished 6 years later and the cost likely to exceed £2.6m. The overhaul and renewal of Flying Scotsman has turned out to be one of the most extensive restoration projects ever undertaken in the heritage railways sector. This investigation was set up to discover why it is so late and so much over budget. The reasons for the delays and cost escalation can be summarised as follows: 1. The condition of the locomotive when purchased was poor. In almost 50 years of post- BR ownership, it had a large number of owners, several of which failed financially. It had been heavily used and maintenance standards had been neglected. 2. The pre-purchase inspection was rushed and painted an overly positive picture . 3. NRM failed to undertake an adequate investigation of the condition of the locomotive, either when it first took ownership or at the start of the refurbishment. Consequently the original budget and timescale for the refurbishment were not based on engineering reality. 4. For much of the time, project management was ineffectual or non-existent. Since the project started, half a dozen different people have been in charge, few of whom had experience of managing a £2m engineering project. It has not been possible to find proper scope or planning documentation for the project. 5. NRM’s supply chain was largely restricted to the heritage railways sector. This is a cottage industry that had difficulty in working within the formal contract management procedures expected of a publically-funded organisation. Several suppliers failed to meet their contractual targets but NRM’s contract management system was ineffective in resolving the problems. 6. The NRM engineering organisation was inadequate for the scale of the work or for supporting the formal contract management structure. Staff losses and illnesses and delays in recruitment exacerbated the situation. 7. There were conflicts between the curatorial desire to retain as many original components and assemblies as possible and the need to produce a locomotive meeting the stringent demands of Network Rail for main line operation. 8. There were also conflicts between the desire of senior management for the locomotive to be seen at public events (the public having funded the purchase) and the need to pursue a structured engineering refurbishment programme. These issues are discussed in more detail in the body of the report, which also recommends actions to reduce the likelihood of other projects suffering similar problems. a The National Railway Museum is part of the Science Museum Group (SMG) formerly know as the National Museum of Science and Industry (NMSI). Page 2 of 29 Contents 1. Executive summary.........................................................................................................................2 2. Objective of report..........................................................................................................................4 3. Brief history of Flying Scotsman prior to NRM ownership .............................................................4 4. Timeline for NRM refurbishment....................................................................................................6 5. Assessment of the condition of the locomotive before purchase..................................................8 5.1. The AEA Technology pre-purchase report...........................................................................8 5.2. The valuation report........................................................................................................111 6. Condition of the locomotive on purchase ....................................................................................13 7. Maintenance and operation of the locomotive in the first 12 months........................................14 8. Viability of the initial restoration plan..........................................................................................15 8.1. Refurbishing the A3 boiler.................................................................................................15 8.2. Frames and running gear................................................................................................177 9. NRM Engineering capability and organisation to undertake the restoration ..............................19 9.1. NRM engineering management........................................................................................20 9.2. Professional engineering skills ........................................................................................211 9.3. Managing subcontractors.................................................................................................22 9.4. Using non-railway subcontractors ....................................................................................22 10. Project management and project ‘drift’ .................................................................................233 10.1. Contract management....................................................................................................233 10.2. Conflicts between conservation and standards for main-line operation........................244 10.3. Marketing vs. Restoration.................................................................................................25 10.4. Project drift .......................................................................................................................25 11. Engineering capacity to maintain and operate the locomotive .............................................255 12. Future NRM engineering core competences............................................................................26 12.1. Systems engineering .........................................................................................................27 13. Conclusions and key findings ..................................................................................................277 14. Appendix: List of people interviewed .......................................................................................29 Page 3 of 29 2. Objective of report Locomotive 4472 Flying Scotsman was purchased for the nation in 2004 at a cost of £2.3 million. It ran in preservation for a further year at which point it was withdrawn from traffic to undergo a major overhaul. The original objective was for the repair to last 1 year and cost £750k. This has proved to be an over optimistic outcome with the repairs still unfinished and with a new budget likely to be in the region of £2.6 million. Following the discovery of additional problems, completion is now anticipated in late 2013. The objective of this inquiry 1 is “to conduct full research into the origins of the [restoration] project and its subsequent management from the engineering perspective. The report is not to focus on individuals but is to draw general lessons and conclusions, including recommendations. The following are areas to be covered: ◊ Engineering history of the locomotive pre-purchase. ◊ Steps taken to assess the engineering condition of the locomotive before purchase. ◊ Condition of the locomotive on purchase. ◊ Maintenance history of the locomotive for the first 12-18 months of ownership and operation, and nature of problems discovered at that time. ◊ Viability of the initial restoration plan. ◊ The extent to which NRM Engineering capability and organisation was capable of conducting the restoration. ◊ Project management and project ‘drift’. ◊ Engineering support and capacity required both to maintain and operate the locomotive once complete. ◊ Recommend future NRM engineering requirements and core competences both to restore/maintain operational locomotives and to maintain the static fleet in the National Collection. Access was provided to relevant documents and interviews were held with NRM staff associated with the project and other parties involved (listed in the Appendix). 3. Brief history of Flying Scotsman prior to NRM ownership The locomotive was originally built by LNER as a Class A1 in 1923. On 30 November 1934, it was the first steam locomotive to be officially recorded at 100 mph. Flying Scotsman was rebuilt in 1946-7 as a Class A3, with its boiler pressure increased from 180 psi to 220 psi and carried out a variety of roles under BR ownership until it was withdrawn from service in 1963 when it was sold for preservation and restored at Darlington Works as closely as possible to its LNER condition. Following another overhaul in 1968-9 by the Hunslet Engine Company, Flying Scotsman went on a tour to the USA, for which it was fitted with cowcatcher, buckeye couplings, and other American equipment. This ended in bankruptcy and a change of ownership. The locomotive was returned to Britain in 1973 and was overhauled in Derby Works. It was subsequently based in Carnforth Steamtown, where it was used for rail