Maintaining and widening the M25 motorway, UK: a private finance case study

The M25 motorway around London, UK, is one of the busiest in Europe. The current contract for maintaining the route, including widening some sections, was awarded in 2009 under a private finance initiative project amid the global financial crisis. This paper reports on the initial funding challenges for the design, build, finance and operate contract under a traditional private financing arrangement within a constrained financial market. The concerns of the UK’s National Audit Office are discussed together with the approach taken by financial advisors, Highways England and the preferred bidder, Connect Plus. After studying recent developments, it is argued that private financing is an attractive procurement route for infrastructure. The lessons learned and benefits of this financial structure are outlined at a time of decline in projects procured under private finance, particularly after the UK government’s latest infrastructure programme ends in 2021.