Need for the scheme. The project will bring a number of benefits to road users including:

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Introduction

Welcome to our Project Bank Account (PBA) industry briefing event for the A96 Inveramsay Bridge Improvement Project, which is the first Scottish road infrastructure project to use a PBA.

The purpose of the PBA briefing event is to give you some background on how Transport Scotland intends to operate the use of a PBA for the project, and to outline details of how payments will be made to the supply chain

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Need for the scheme

The existing Inveramsay Rail Bridge is located on the A96 and is a masonry arch with a 4.4m

height restriction. Due to the arch of the bridge, traffic passing under the structure is restricted to a single lane controlled by traffic lights.

The Inveramsay Bridge Improvement project involves the construction of a new bridge

structure to take the road over the railway. As part of the works, the A96 will be realigned over a length of 1.5 km.

The project will bring a number of benefits to road users including:

• reducing delays caused by the traffic signals

• cutting the number of bridge strikes, which can cause road and rail closures

• improving road alignment by allowing two-way traffic on the trunk road

• improving safety and reducing driver frustration

• reducing instances of car idling and improving the local environment.

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Inveramsay Bridge

The Minister for Transport and Veterans

announced in January 2014 that the procurement of the Inveramsay Bridge Improvement Project

started with the publication of a contract notice on the Public Contracts Scotland website.

“We want to see improvements to transport connections right across the north east, and the latest developments on the Inveramsay

Bridge scheme underlines our commitment to improving journey time reliability and reducing congestion in this area.

“Inveramsay Bridge is a notorious bottleneck and the Scottish Government is committed to

removing the traffic lights that have affected road users travelling on this stretch of the A96 for

many years.

“This is not an easy task. The scheme will involve complex engineering works during construction, such as building a new bridge structure to take the road over the railway. This will involve the realignment of the A96 over a length of around 1.5km.”

Keith Brown

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Views of the scheme

Existing view

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Procurement

The procurement competition for this design and build project will be undertaken in

accordance with European and UK regulations. Contractors and suppliers seeking to tender for the work are currently being invited to submit expressions of interest.

The Contract Notice was published on the

Public Contracts Scotland portal. Following this a shortlist of participants will be identified and invited to participate in a competitive dialogue process.

Final tenders will require to be submitted by Autumn 2014, after which the contract will be awarded following rigorous consideration of the final bids.

The contract is due to be awarded by the end of 2014.

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Project Bank Accounts

The Deputy First Minister announced, in April 2013, the Scottish Government’s acceptance of the recommendation of the ‘Review of Scottish Public Sector Procurement in Construction’

to trial PBAs on public sector construction projects.

“We are happy to take on board the trial of

Project Bank Accounts for public sector projects and we are now looking to identify suitable

opportunities which will support local and

national economies and boost cash flow for both contractors and sub-contractors.

“Using Project Bank Accounts guarantees a

diverse and competitive marketplace, meaning

that Scotland’s many SMEs are given the

confidence to compete for Scottish construction contracts.”

Nicola Sturgeon

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Project Bank Accounts

The A96 Inveramsay Bridge Improvement

project is the first road infrastructure project in Scotland to use a Project Bank Account to speed up payments to the supply chain.

It is intended that Project Bank Accounts shall be ring-fenced accounts, with effective Trust

status. Payments can be made directly and simultaneously to the main contractor and

members of the supply chain, thereby reducing payment timescales within the supply chain.

The electronic payments made through a PBA should typically take five days or less.

PBAs are already being used by bodies such as the Highways Agency, Ministry of Defence and the Environment Agency in England. The use of PBAs is mandatory on government construction contracts in England and Northern Ireland and are currently being trialled in Wales.

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The benefits

• Reduced insolvencies: PBAs should improve cash flow, particularly for SMEs, and it is

anticipated that improvements in cash flow will reduce insolvencies

• Reduced risks associated with

insolvencies: Payments do not pass through

a number of hands down the supply chain, so the risk of non-payment as a consequence of insolvency further up the chain is reduced

• Increased speed of payments: These are made straight from the PBA to members of

the supply chain rather than having to cascade down the supply chain

• Greater efficiency/certainty: Less time and effort will be spent pursuing payment up the supply chain, thus reducing administration costs. Shorter payment periods should also

reduce the extent to which supply chain

members need to include financing costs in

their pricing. The number and cost of payment disputes should also be reduced

• More focus: PBA will assist the supply chain to focus on delivering the project, leading

to greater transparency, collaboration and innovation.

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Timeline

30 January 2014

OJEU notice issued

18 February 2014

Project Bank Account Industry Briefing Event

Spring 2014

Invitation to participate

Late 2014

Contract award and start of construction

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References

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