Overspend on capital projects reaches £2.45bn

Northern Ireland’s auditor general has called for an overhaul of capital project commissioning with the projected cost of 77 projects currently overrunning by 44%...

tower cranes at construction site

CEF has joined the auditor general in calling for reform of capital project commissioning and management in Northern Ireland after a new report highlighted major overruns in spend and completion dates.

Reviewing 77 works in the region’s major capital projects portfolio between April 2019 and August 2023, the Northern Ireland Audit Office (NIAO) identified an overspend of 44% totalling £2.45bn.

Of 11 flagship projects announced by the NI Executive, only the Belfast Rapid Transit, Windsor Park and Kingspan  projects have been completed to date.

The latest NIAO figures represent an update of its 2019 report, when the overrun had reached £700m.

Originally estimated to cost £5.63bn, the 77 projects are currently projected to hit £8.08bn.

Recognising the inherent complexity of major capital projects, and mitigating factors such as the pandemic, inflation and global political factors, Auditor General Dorinnia Carville said nonetheless there was little evidence of improvement or past lessons learned.

“It is clear that departments are not achieving value for money in the delivery of these major capital projects,” she said. “A comprehensive transformation project must be established to overhaul the system for commissioning major capital projects and ensuring stronger accountability for how these projects are delivered.”

Mark Spence, Chief Executive, CEF, said, “The NIAO follow-up report is a stark reminder to the returning Executive of the need for immediate focus on how the public sector seeks to commission, procure and deliver major capital projects.

“While the period since the previous report’s last publication has, unquestionably, been one of major challenge in this space given the pandemic, the unprecedented period of inflation and material shortages and the lack of an Executive, it remains the case that much still needs to be done to ensure value for public money and enable greater confidence within the construction industry as to the pipeline and deliverability of major schemes.

“Many of the concerns and frustrations we identified in evidence to the NIAO in 2019. remain. However, in working collaboratively with the construction industry, we believe there are clear and deliverable solutions.”

CEF’s proposals include:

• Agreement of multi-year capital budgets to give funding certainty to Government departments and the construction industry

• Publication of a funded pipeline of works flowing from a multi-year financial settlement

• Utilisation of a broader range of procurement approaches and

forms of public contract seeking to incentivise contractors

• Fundamental reform of the planning system

• Establishment of an independent Infrastructure Commission for NI to identify and address issues


View the full NIAO report at: