COMPULSORY purchase orders have led to spiralling costs in a major Hereford transport plan.
The Hereford City Transport Package was conceived in 2009 with the ambition to deliver a new city link road, a series of public realm projects to create sustainable transport entry into the city, and a sustainable transport hub which would link cycling with bus travel and the railway station.
With a budget of £40.027million, it was a grand plan that was supposed to transform travel in Hereford and beyond.
But unforeseen costs relating to compulsory purchase orders have threatened the plans, and the council’s contractual obligations, with current spending already at more than £34million, and several vital elements of the project still to be built.
Neil Taylor, interim director of economy and place, told a meeting of Herefordshire Council’s Cabinet on July 22 that a cabinet report in 2013 agreed the use of compulsory purchase orders (CPOs) for the land needed for the road and regeneration projects.
A further decision was taken in 2015 to widen those land acquisitions and the project continued under an officer-led board.
But in 2017, it became clear there was a developing overspend on the land costs, Mr Taylor said.
“There is all sorts of legislation around compulsory purchases,” he said.
“Taking peoples’ property from them by force is not an easy process, and there are tribunals and court hearings to establish the value of the compensation, and that is going on to date.”
The then-Cabinet decided to use some of the project’s contingency funds to cover the escalating costs, while further money had to be allocated to land purchases and compensation in March this year, leaving insufficient money to deliver the transport hub and other projects.
“That is disappointing for the project, but also gives us a problem with the Marches LEP, who funded £14million of this project, and we are contractually committed to deliver the rail and transport hub,” Mr Taylor said.
Cabinet member for infrastructure and transport, Councillor John Harrington, who took up his post in 2019, said when he reviewed a report on the project earlier this year he was told there were extra land costs, but that he was not clear why the previous council administration had not been more aware of the pitfalls of using compulsory purchase orders.
“Why were we not more aware that we were paying people 90 per cent of what we thought the property was worth, but that they did not have to accept that and could take the money and then come back within six years and ask for the final settlement,” he said.
“That was a huge risk. You put in mitigating factors and we did not do that. Essentially, this was going to go wrong, and when we saw it was going wrong, we decided to use up all our reserve and keep sailing on in the hope that we would deliver everything.”
“No-one seemed to have understood that risk, and that is what concerned me the most.”