Heads of the Valleys road 'extortionate', says Plaid
- Published
The Heads of the Valley road runs from Abergavenny to Hirwaun - through stretches such as this at Clydach
A massive road scheme for the Heads of the Valleys has failed to ensure it is value for money, Plaid Cymru has said.
The project, to turn the 11-mile stretch (18km) of the A465 into dual carriageway between Dowlais and Hirwaun, has a £590m price tag.
But the taxpayer will end up paying over £1bn due to the funding model.
Welsh Government ministers said the final figure includes maintenance costs and the project would not be going ahead otherwise.
The economy minister announced last month that the work near Merthyr Tydfil would be the first project to be delivered using the Mutual Investment Model (MIM).
Under this approach, private partners are awarded contracts to build and maintain public assets.
In return, the Welsh Government pays a fee to the developer, which will cover the cost of construction, maintenance and financing the project.
At the end of the contract the asset will be transferred into public ownership.
In the case of the A465, the cost of the work is £590m.
However the Welsh Government will pay £38m a year for 30 years, bringing the total to £1.14bn.
Plaid Cymru's South Wales East Senedd member Delyth Jewell described the sum as "extortionate" and a "waste of public money".
"We're talking about an 11-mile stretch of road that's going to make sure that governments for decades into the future are [footing] the bill.
"That cannot represent good value for money.
"With the Mutual Investment Model, it involves working with private companies and ensuring they have to make a profit.
"Yes, there are maintenance costs that they will be covering, but there will be a substantial amount of profit they will ensure they cream off as part of that".
Work dualling the road has been going on for years - this was the stretch at Brynmawr this autumn
Critics say the MIM model is simply a rehashed version of controversial Private Finance Initiative (PFI) which has left many public bodies counting the cost years after projects were completed.
However, ministers argue this model is more transparent, removes hidden costs, and secures social and environmental benefits.
For example, in the case of this A465 scheme, they said 120 apprenticeships, 60 traineeships, and over 320 internships would be created.
Speaking in the Senedd on Tuesday, the First Minister said: "What the Mutual Investment Model delivers for the Dowlais to Hirwaun stretch is a fixed-price contract.
"So, the risks are carried by the private sector contractor - they have to deliver this road on budget and on time, otherwise there are very significant penalties that lie with them and not with the public purse."
Mark Drakeford added: "Were we not doing it through the Mutual Investment Model, this road would not be going ahead.
"It's the only way that we are able to make that investment."
Other schemes lined up for the Mutual Investment Model include the redeveloped Velindre Cancer Centre in Cardiff, as well as new schools across Wales.
You can see more on this story on Politics Wales on BBC One Wales and on the iPlayer.
- Published4 March 2020
- Published3 April 2019
