Transport Scotland has driven down costs by more than £100 million for the M8/M73/M74 motorway improvements project after awarding the contract to the Scot Roads Partnership Project (SRP).
Advanced works will start immediately following the signing of an early works agreement.
This contract, with a net present value of £500m and which includes operation and maintenance of the project roads over 30 years, will be the first roads infrastructure scheme and the largest contract to be awarded as part of the Scottish government’s £2.5 billion non-profit distributing (NPD) model. NPD helps to deliver economies of scale and efficiencies for the public purse.
In addition, construction costs are now £105m below original estimates following a robust competitive dialogue with the preferred contractor, SRP.
Following a significant level of international investor interest, funding from the project will come from the European Investment Bank (EIB) and a group of investors managed by Allianz Global Investors.
Transport Minister Keith Brown said: “The M8 M73 M74 motorway improvements project is breaking new ground, which is great news for Scotland and great news for the jobs market.
“It is the first UK roads project involving bond finance since the global financial crisis in 2008. It is also the largest NPD project to reach this stage and demonstrates confidence from the international investor community in the NPD model and that Scotland’s infrastructure is seen as a viable and desirable long-term investment.
“In order to deliver the project at the earliest opportunity, I am also pleased to announce that Transport Scotland has entered into a pre-start works agreement with the contractor. This will allow advance works to progress without delay with the contract expected to be signed during February.”
Construction of the new M8 and improvements to the M73 and M74 is expected to create hundreds of jobs.