Paper H
Growth Deal programme
Report to the Humber LEP Board, 12 May 2017 Report from Richard Kendall, Executive Director – Strategic Policy & Business Development
1. Summary
1.1. This paper updates the Board on the programme.
2. Recommendations
2.1. That the LEP Board removes the hold on the South Humber Gauge Enhancement project.
2.2. That the LEP Board notes the project updates and current programme position.
2.3. That the LEP Board adds the Stoneferry Road Integrated Transport Project to the Growth Deal programme with a £7.5m allocation.
3. Implementation summary
3.1. The latest implementation summary is included at Appendix 1. Updates are provided below on an exception basis:
3.2. South Humber Gauge Enhancement
3.2.1. The LEP Board previously put this project on hold due to issues with cost and delivery. Following the discussions between the LEP Executive, accountable body, North Lincolnshire Council and Network Rail, the project is now in a position to progress using Network Rail funding this year – with the LGF contribution profiled to follow next year subject to business case approval and legal agreements being in place.
3.2.2. The LEP Board is recommended to remove the hold on the South Humber Gauge Enhancement project. The accountable body will liaise with the project sponsor to progress the business case appraisal at the most appropriate time.
3.3. Delivering Housing Growth in Hull
3.3.1. The project continues to progress well, and has brought forward £1.5m initially allocated to 2017/18 to complete the full LGF spend in 2016/17 in order to help programme performance.
3.4. Bridlington Integrated Transport Plan Phase 2
3.4.1. As reported previously, this project has experienced delays due to the Network Rail decision-making process. The project has claimed £2.1m against an original profile of £4.09m in 2016/17.
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3.5. ERGO
3.5.1. This project had been delayed but is now progressing well. All LGF monies were claimed at the end of Q4 2016/17, as per the original agreement.
3.6. Stallingborough Interchange - Phase 1
3.6.1. Despite delays to the approval and start of this project, £947k of the full £1m project allocation was claimed in Q4 of 2016/17, with just £53k being rolled forward to 2017/18.
3.7. Increasing the visitor economy in North Lincolnshire (Normanby Hall Country Park)
3.7.1. Although this project was added to the programme on the basis of achieving full expenditure in 2016/17, delays in securing the funding agreement and a lack of progress has meant that this project is now expected to spend in 2017/18.
3.8. Completed projects
3.8.1. The following projects are considered to have been completed during 2016/17 (subject to audit), but will continue to be monitored for outputs:
3.8.1.1. Grimsby Town Centre Infrastructure and Enabling Works
3.8.1.2. Humberside Airport Access Improvements
3.8.1.3. A161 Bridge Street cycle scheme
3.8.1.4. Grovehill Bridge Maintenance Scheme
4. Growth Deal 3
4.1. Following the announcement of the Humber’s £27.9m third Growth Deal by Minister Andrew Percy MP on 23rd January, the projects included in the Deal were contacted with a request to submit a Full Business Case. We are waiting for Full Business Cases for the following projects:
Unlocking Hull City Centre Development
Grimsby Town Centre – ‘Unlocking the Potential’
Goole Intermodal Terminal
Skills Capital Programme
River Hull Defences
Paull Phase 1 and 2 Employment Site
Stallingborough Strategic Employment Site
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4.2. One project, the Growing the Humber extension, has already progressed.
5. Programme position
5.1. Due to the issues with a small number of projects reported previously, the provisional outturn for 2016/17 was 70% LGF expenditure (compared to 95% in 2015/16). This is in line with the forecast made at the end of Q3. The accountable body has been able to absorb the underspend this year in order to meet the capital expenditure requirements of the Government grant, but it will have less flexibility to do so in future years. The underspend will be re- profiled across future years.
5.2. The LGF grant profile across financial years 2017/18 to 2020/21 has been received from Government as follows:
2017/18 2018/19 2019/20 2020/21 Confirmed Indicative Indicative Indicative £27,269,412 £12,721,021 £11,050,217 £22,232,046
5.1. The LEP asked for a more even profile than the one shown above that would have aligned more closely with expected project expenditure, making clear that the 2017/18 allocation would be difficult to deliver in full. Unfortunately this was not possible.
5.2. The expectation is that the profile will be managed locally using the LEP’s programme flexibility and the accountable body’s own capital programme. It is important, therefore, that the business cases for new projects come forward as quickly as possible.
5.3. As part of a review of the programme following completion of the Q4 2016/17 claims, projects considered to be a medium/high delivery risk will be called in for additional scrutiny.
6. Programme surplus
6.1. As a result of the cancellation of the Hull-East Coast Main Line Electrification and Port of Grimsby Offshore Wind Operational Support Facilities projects, £7.7m of LGF is available for reallocation.
6.2. Following consideration by the Joint Strategy Unit, two projects have been prioritised from the pipeline to utilise this funding:
6.3. Stoneferry Road Integrated Transport Project
6.3.1. The Stoneferry Road corridor is the primary route from the Port of Hull to York and the North, is the main means of access for ten Humber Enterprise Zone sites and provides access to an area of major housing growth. Congestion on the corridor is significant and forecast to worsen. It will also be a diversionary route during the A63 Castle Street works.
6.3.2. The Stoneferry Road Integrated Transport Project was prioritised for the Round 3 Growth Deal bid, but was outside the funding awarded by
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Government. It was independently appraised as part of the Growth Deal 3 process and scored very highly.
6.3.3. Hull City Council, the project sponsor, has continued to develop the project since the Growth Deal submission. During this time funding was awarded for the Garrison Road roundabout upgrade, and discussions about the delivery of the A63 Castle Street scheme have progressed.
6.3.4. As a result of this Hull City Council has identified that the project should be optimised to cover:
Stoneferry Employment Corridor improvements, building on the Garrison Roundabout works
Tackling the known pinch points in a holistic way to keep the city moving
Enabling works to support the local network during the Castle Street scheme ensuring the city remains connected and the economic benefits of the 2017 legacy are not lost.
6.3.5. The original scheme sought a £2.34m LGF contribution towards a total £2.8m project. The expanded scheme seeks a £7.5m LGF contribution towards a total £8m project, and includes the additional benefits above.
6.3.6. The LEP Board is recommended to add the Stoneferry Road Integrated Transport Project to the Growth Deal programme with a £7.5m allocation. As per the normal process, the project would then be developed to Full Business Case and externally appraised before coming back to the Board for a final decision to commit the funding.
6.4. Eastrington and Laxton Flood Alleviation Scheme
6.4.1. The second scheme under consideration is a small flood risk alleviation scheme near Howden, which would utilise the remaining funding.
6.4.2. This project has already been developed to Full Business Case stage and the project sponsor, the Ouse and Humber Drainage Board, says that it is ready to be delivered with match funding secured.
6.4.3. A peer review of the project has identified some questions which require further consideration. The LEP Executive will liaise with East Riding of Yorkshire Council on these, and subject to a satisfactory outcome the accountable body will be asked to progress the project to external appraisal.
6.4.4. It is anticipated that the Board will be asked to make a decision on whether or not to commit funding to the project at the next meeting.
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Paper H Appendix 1: Growth Deal projects update – May 2017
Approved projects in delivery
£m LGF Project status £m LGF Project status Scheme Scheme 17/18 Total 17/18 Overall 17/18 Total 17/18 Overall
Growing the Humber+ 0.28 ↓ 4.00 G G RHICS: Holderness Drain 0.30 1.04
South Humber Rail Gauge Delivering Housing Growth in Hull 0.00 ↑ 10.00 G G 0.00 ↓ 7.20 R R A A Enhancement
CATCH Energy Offshore 0.00 1.75 G Re-purposing the Old Town 0.40 3.00
Goole College Skills Workshop A1105 Anlaby Road Corridor/ Park 0.00 0.38 G G 0.00 0.75 Modernisation Street Bridge Strengthening Environmental Logistics Learning Westcliff Regeneration Enterprise 0.00 2.05 G 0.00 0.55 Hub Hub Hull and Holderness Flood 1.23 3.00 G A A Hull Venue 0.00 3.50 G G Alleviation Scheme Anlaby and East Ella Flood 2.21 5.10 A A A ERGO 0.00 1.00 Alleviation Scheme Lincolnshire Lakes Flood Risk 4.05 13.32 Stallingborough – Phase 1 0.05↓ 1.00 A G Strategy
Bridlington ITP Phase 2 2.00 5.75
Notes: Changes are highlighted in darker colours. Figures are rounded. – In progress * Project sponsor commenced delivery prior to funding agreement. ** Recommended for Board decision ↑ / ↓ direction of profile change, brackets denote provisional pending approval # To be increased – exact amount TBC
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Paper H Committed projects
£m LGF Business Approvals Funding agreement Delivery Project status Peer Scheme case Sub- LEP Final 17/18 Total review HLB Completed Started 2017/18 Overall submitted board Board issued Round 1 projects Connecting the City - Bridge over A63 0.00 4.00 A A at Hull Marina
Hessle Foreshore Tidal Defence 0.08 2.00 A
Cottingham and Orchard Park Flood 3.31 5.00 A A A A Alleviation Scheme River Hull Integrated Catchment Strategy: Delivery
River Hull Channel Improvements 0.10 0.70 R R Hempholme and Wilfholme 0.47 0.84 R R Pumping Stations Hull Tidal Barrier 0.06 0.66 R R River Hull Navigation Authority 0.10 3.81 R
Connecting River Hull Waterfront 0.00 3.75 Round 2 projects A18 Melton Ross Railway Bridge 0.00 1.75 Skills maintenance programme 0.00 1.06 Central Cleethorpes Regeneration 0.00 1.00 Programme Additional projects Increasing the visitor economy in North Lincolnshire (Normanby Hall 0.51 ↓ 0.52 R R Country Park) Round 3 projects
Growing the Humber – Round 3 2.00 8.00
Unlocking Hull City Centre 0.00 2.50 Development
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Paper H £m LGF Business Approvals Funding agreement Delivery Project status Peer Scheme case Sub- LEP Final 17/18 Total review HLB Completed Started 2017/18 Overall submitted board Board issued Grimsby Town Centre – ‘unlocking the 1.49 3.68 potential’
Goole Intermodal Terminal 0.00 2.1
Skills Capital Programme 1.00 8.00
River Hull Defences 1.00 3.00
Paull Phase 1 and 2 Employment Site 2.00 1.00
Stallingborough Strategic Employment 1.60 1.60 Site
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