Heathrow approval is an historic moment but now the industry needs to respond

David Whysall
29 June 2018

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Heathrow expansion

This week saw MPs overwhelmingly vote in favour of Heathrow expansion but there is still a long way to go before a spade goes into the ground and now the industry needs to show it can rise to the challenge and ensure the project is a success story, says David Whysall.

The vote in parliament in favour of the expansion of Heathrow Airport looks set to be an historic moment.  It represents a vital step in unlocking new airport capacity for passengers and cargo, creating jobs and business opportunities nationwide, building new commercial and cultural links around the world, and channelling fresh private investment into economic outcomes across the UK.

For those of us working in infrastructure and construction, the decision is not only an opportunity to build an expanded Heathrow, but a lasting legacy for our industry.  We should take this vote as a mandate to shake off the inertia of the past and embrace the new ideas we have to transform the delivery of major infrastructure projects.

Rising to the challenge

We all know that our industry’s performance has fallen short in the past; structural issues have led to unsustainable low margins causing high-profile casualties, while major projects have failed to complete on time, on budget and to the standards we expect.

Heathrow expansion presents an opportunity to positively disrupt and shift the industry model. There is now, more than ever, a collective recognition of these challenges and the need for change – a view shared across government, clients and the supply chain. As a result, there’s a growing body of new ideas which Heathrow can and is drawing upon.

Last year, the Department for Transport’s Transport Infrastructure Efficiency Strategy (TIES) was backed by all of the UK’s major public infrastructure delivery organisations, including Crossrail, Highways England, Network Rail, HS2 and TfL.  The strategy sets out seven crucial steps to improve performance – ranging from how we make investment decisions, to how we use data to benchmark performance and how we can exploit digital technology. 

This strategy showed that Government is thinking differently.  It is working closely with the Construction Leadership Council with the direct goal of increasing productivity within the sector.  There’s clear recognition that efficiency isn’t simply achieved by slashing costs and screwing down supplier margins, but by working together to achieve better performance across the whole life of assets, through planning, delivery and operation.

Embracing new models

Heathrow is thinking differently too.  For its expansion programme, as well as adopting the recommendations of the DfT’s work into its delivery model, the airport is also a participant in Project 13, a cross-industry initiative to define a new sustainable model for delivering infrastructure.  Project 13 proposes an enterprise model, in which the relationships between the asset owner, investor, integrators, advisors and suppliers are no longer transactional and disconnected, with rewards determined by time and cost.  

Instead, all parties work collectively as a single enterprise, incentivised based on the real outcomes of projects.  In this sense, both TIES and Project 13 ask clients to make fundamental changes to their relationship with the marketplace, seeking long-term partners who can align not only commercial rewards, but working culture, investments and mindset.  

This change must be embedded at the very outset and we need to pay particular attention to the way that our major programmes are initiated.  As set out in the Infrastructure and Project Authority’s project initiation routemap, we need to meaningfully assess and develop our industry’s capabilities and capacity to respond to the specific challenges we face and outcomes we want to achieve.

The Heathrow opportunity

A lot of good theoretical work has been done and we now need to put it into practice. It is extremely promising that Heathrow has conceived a delivery model that places these ideas at the heart of this nationally critical programme. It will provide the platform for expansion to be delivered more quickly, more safely, more productively, and to a standard that other major aviation projects haven’t yet achieved globally. There is no easy solution to the challenges we face.  But backed by political support, Heathrow can now start the long-awaited transformation of our sector.

David Whysall is managing director of UK infrastructure at Turner & Townsend.