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17
Apr
Harrogate Station Gateway: Business anger over secret emails showing 'low' benefits
North Yorkshire Council is pressing ahead with the £12.6 million Harrogate Station Gateway even though its own calculations indicated the business costs outweighed the benefits.
The finding, which was not made public, will increase pressure on the council as the case heads to the high court next week.
It is the second in a series of gateway revelations published by the Stray Ferret this week based on more than 100 pages of email correspondence between the council and the Department for Transport, which we obtained following a freedom of information request. The Department for Transport is the main funder.
You can read yesterday's article, which revealed just 39% of the £12.6 million funding will be spent on construction and 22% will be spent on consultants, here.
Councillor Keane Duncan, the council's Conservative executive member for highways, has hailed the gateway as the biggest investment in Harrogate town centre for 30 years. It will see major changes to Station Parade, Station Square and the One Arch pedestrian tunnel.
But the anti-gateway business group Get Away claims it will harm the town centre and has questioned the economic benefits.
It says our findings raise "serious questions" about the council and its decision to proceed — as well as why the council did not make the information public.
BCR assessment
The council conducted a benefit-cost ratio assessment, which is a standard metric used in project management to evaluate profitability, on the revised gateway in 2023.
Its original plans, which would have seen a section of Station Parade reduced to single lane and part of James Street pedestrianised, had just been scaled back after the council admitted its process was legally flawed.
The BCR is calculated by dividing benefits by costs. A BCR below 1 indicates the costs outweigh the benefits, and often leads to projects being scrapped.
An email by Matt Roberts, the council’s economic and regeneration officer on August 31, 2023 said officers were preparing a report to the council's ruling executive “on agreeing a direction of travel” for the gateway.
He said:
As you’re aware we’ve been looking at what a reduced-scope pedestrian led scheme might be. WSP have advised that the BCR will likely be negative (less than 1). What might be considered an acceptable BCR in DfT’s view?
WSP is the Canadian consultancy firm that is being paid £2.8 million by the council for its work on the gateway.
A DfT official, whose name has been redacted, replied the same day:
There isn’t a specific BCR threshold at which DfT would outright reject a scheme, but obviously a BCR of 1 and below constitutes poor value for money which is not ideal.
Station Square would be re-landscaped as part of the scheme.
The official adds the council would need to demonstrate "stronger cases on other elements" of the scheme to compensate.
In a subsequent email on September 19, Mr Roberts says the council's executive is considering three option: carry on, do something or do nothing.
He adds:
We have been reviewing how the BCR/strategic case of a smaller pedestrian-led scheme might be impacted. It is likely that the BCR would reduce, perhaps to 0.5-0.8.
Further emails reveal the original business case for the gateway “assessed a BCR of 1.70 (Medium) for the core scenario presented”.
They say the full business case for the new version had eventually assessed the BCR to be "1 (Low)".
The council claimed “wider scheme benefits arose from land value impacts of new developments in the surrounding area”. It also listed five benefits of the new scheme — none of which mention businesses.
The council subsequently approved the scheme to continue.
'Why has the council not been transparent?'
David Waddington, of Hornbeam Park Development, which is part of the Get Away group, said:
In light of these revelations serious questions now need to be asked of the Department for Transport and North Yorkshire Council. Why has the council not been transparent about the cost-benefit value and high risk of unexpected cost increases?
And why isn’t the Department of Transport seriously questioning the scheme given now what we know, and at a time when the government is putting all departmental spending under huge scrutiny?
A north facing visual of how Station Parade will look.
We asked the council why it was proceeding with a scheme whose BCR it had rated as low, and despite Department for Transport concerns that it constituted poor value for money. We also asked why it had not been transparent about revealing the data.
It replied in a statement:
The benefit-cost ratio has been impacted by changing the scope of the scheme, as we have removed certain elements. Work is ongoing to finalise the figure.
Look for the third and final part of the our gateway revelations tomorrow on the Stray Ferret.
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