Cost of Carlisle Southern Link Road doubles to £150M as contractors put on notice for job

The new 8km road was initially advertised as a £75M contract in 2020, then the two-stage design and build contract was awarded to Morgan Sindall at £65M in March 2021. The contractor carried out stage 1’s enabling works in late 2021.

Morgan Sindall was expected to be given the green light to continue onto stage 2, but Cumbria County Council had to pull out of the agreement citing “the ongoing uncertainty associated with supply chains, the cost of construction materials and rising energy costs, caused by several factors including Brexit and Covid, and which is being exacerbated by events in Ukraine”.

Cumbria County Council and its delivery partner Carlisle City Council had said they would approach government bodies such as Homes England for additional funds.

The councils have now begun the process of retendering the contract, stating that they will be publishing an invitation to tender for a £150M design and build contract in early September.

The contractor will be expected to provide all necessary design and build, labour, plant and materials.

The CSLR will connect junction 42 of the M6 with the A595 to the west, featuring four new roundabouts, five cycle bridges, four road bridges and a cycle path along the entirety of its northern side. Two of the bridges will cross Network Rail assets (West Coast Main Line and Cumbrian Coast Line) while another will cross the River Caldew.

Along with the indefinite pause of the A361 North Devon Link Road and the re-tendering of Gloucestershire’s M5 junction, the CSLR is one in a series of road schemes that have been waylaid by inflationary cost rises.

Construction labour inflation had reached 8.1% in the year to May, and building materials inflation had reached 27.2%. While these facts are affecting the whole industry, roads have been additionally hit by energy price rises due to the requirement for energy-intensive materials such as steel and oil-based commodities like bitumen.

Energy usually accounts for 25-33% of the cost of manufacturing energy-intensive materials. With the cost of commodities also rising, these increased materials prices are pushed on to the contractors. These firms must then increase their quote prices to cover the costs, which in turn leaves local authorities scrambling around for more funds.

The positive news is that steel is forecast to reduce in price in Q3 of 2022, while asphalt and concrete will only rise by another 1% and 2%, respectively, according to data from Linesight UK.

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