Delaying Parliament refurb decision will add over £400m of cost every year to work, NAO says

A report by the National Audit Office has said that every year of delay on work to upgrade the Palace of Westminster will add more than £400m to its overall cost.

In a new report on the plans, the government’s independent spending watchdog said each year of delay will add between £320m and £420m to its final cost.

Two options have been recommended – a full decant which will cost between £11.1bn and £15.6bn and take between 19 and 24 years to complete and the slower Enhanced Maintenance and Improvement (EMI) plus initiative which will cost between £19.5bn and £39.2bn and take between 38 and 61 years to finish.

The report added: “Although the options and their underlying estimates have been through a standard process of development and have been subject to internal and external checks to examine and assure them, all are at an early stage and are likely to face cost and schedule pressures as designs develop.”

MPs said the Restoration and Renewal client board now needed to get on and pick a scheme to stick with. “The costed proposals provide enough information for a decision, although the EMI options are less developed and more uncertain,” it said.

It added: “The proposals also recommend that Parliament approves an initial seven-year programme of ‘Phase One’ enabling works capped at £3bn. Undertaking these works is a sensible approach, as this allows the Programme to progress while managing several risks.

“But plans for how the works will be overseen and delivered need to be finalised. Suitable temporary accommodation is essential if the Houses are to decant and Parliament is to function properly.”

It said that the responsible delivery teams:

• publish and regularly update a clear, non-technical summary, potentially alongside its business case, akin to Strategy and Delivery Plans used for megaprojects

• provide cost estimate ranges for all ‘Phase One’ work packages and set out how interdependencies between key projects will be managed

• ensure that links and decision-making responsibilities between projects across the Programme and related work on the Parliamentary estate are managed through a single, integrated delivery plan

• work with MPs and Lords at speed to create a clear vision for how each House, and Parliament as a whole, will operate in their temporary accommodation

• review the Programme’s governance arrangements to set clear requirements and hold those delivering to account.

A UK Parliament spokesperson said: “The NAO concludes the Restoration and Renewal programme addresses a clear and urgent need to reduce risks to the home of Parliament and there is no way forward that does not incur cost and risk.

“The proposals put forward by the R&R Client Board, which includes MPs and Lords, include a recommendation for seven years of initial works with capped costs which the NAO has recognised as a sensible approach.

“The proposals are expected to be debated by Members of both Houses to decide a way forward. The NAO provides welcome scrutiny and has stated the proposals provide enough information for a decision.”