Light touch Business Case review (2024)
Overview
As part of a £2.5 million funding agreement with the Ministry of Housing, Communities and Local Government, East Sussex County Council committed to conducting a light-touch business case review to support the first grant claim for the Queensway Gateway Road (QGR) project in 2024. This review ensures that public funds are used transparently and responsibly.
Rather than a full business case, this high-level review provides a concise summary of the strategic benefits and economic rationale for the additional investment needed to complete the QGR. The Government agreed that this approach would be sufficient to demonstrate value for money and the expected outcomes of the scheme.
The updated review outlines how the project has evolved since the original business case was approved by the former South East Local Enterprise Partnership in 2015, see Queensway Gateway Road - The South East Local Enterprise Partnership. It reflects changes to the indicative budget, delivery timelines, and economic assumptions. Crucially, it confirms the scheme’s continued alignment with regional growth priorities—particularly in unlocking employment land and improving transport links within the Hastings–Bexhill Growth Corridor.
To maintain transparency, the County Council is publishing this summary to highlight the key benefits expected from the QGR investment:
- Improved traffic flow and reduced journey times
- Greater resilience and reliability across the local road network
- Improved access to key employment and residential sites
- The potential to unlock up to 12,000 square metres of employment floorspace
- Opportunities to attract private sector investment and support local job creation
The light-touch business case also outlines the projected economic impact over a 10-year period, including significant gross value-added (GVA) benefits.
QGR business case benefits
Overview
Queensway Gateway Road forms a key infrastructure investment in the Hastings - Bexhill Growth Corridor. This project will enable the final connection of Queensway Gateway Road (QGR) to the existing A21 by developing a signalised Junction to manage demand and optimise traffic flows efficiently. Once completed, it will enable the road to realise its strategic potential, providing economic benefits to businesses while improving journey times and reducing congestion. East Sussex County Council has been working with the South-East Local Enterprise Partnership (SE LEP) and Ministry of Housing, Communities and Local Government (MHCLG) to deliver the completion of the road.
2024 update on benefits realisation
Business case update
Since the first Business Case was produced in February 2015, the project’s budget has undergone changes, this has an impact on the benefits calculations presented in the 2015 business case. This review provides an update to the benefits presented.
2016 - Following technical reviews and SE LEP spending schedule, the project budget was reduced to £6M
2017 - Additional £4M SE LEP funds allocated to the project - Total budget £10M
2024 - Additional £2.5M ESCC / MHCLG funds allocated to the project – Total budget £12.5M
Budget sought 2015 = £15m
Budget sought 2024 = £12.5m
Economic growth and regeneration benefits (2015 business case)
2015 business case
When the 2015 Business Case was produced, a number of assumptions were accounted for in order to calculate the development potential and opportunities created by the delivery of the QGR.
2015 assumptions:
- Budget sought: £15M
- Employment Floorspace unlocked: 12,000 sqm
- Private Sector investment unlocked: £40M
- GVA benefits per net additional job created: 10-year
job persistence
2024 business case
For the current QGR Business Case review, the following assumptions were taken. These assumptions follow the updates the project has had since 2015.
2024 assumptions:
- Current Budget: £12.5M
- Employment Floorspace unlocked: 12,000 sqm (unchanged)
- Private Sector investment unlocked: £40M (unchanged)
South-East avg. turnover per employee in the construction sector has remained constant since 2015. - GVA benefits per net additional job created: 10-year job persistence (unchanged)
Overall impact created by QGR (expected outcomes)
- Opening the QGR helps towards unlocking the development potential and opportunity of key sites in the region, potentially improving employment.
- Improved traffic flows in the surrounding area. Improved
accessibility and reduced journey times.
2024 updated design for Queensway Gateway Road
Economic growth and regeneration benefits
| Benefit | 2015 Business Case | 2024 Business Case |
|---|---|---|
| 1. Employment land | Opening the QGR helps towards unlocking the development potential and opportunity of key sites in the region, potentially improving employment. In combination these sites have an identified capacity for up to 12,000sqm of employment floorspace to be delivered by private investment. |
The relief of traffic congestion between the Bexhill Hastings Link Road (BHLR) to the A21 (Growth Corridor) through Queensway Gateway Rd would improve the area’s employment development potential. ~12,000sqm of employment floorspace to be delivered by private investment. |
| 2. Construction jobs |
Based on published BIS statistics for turnover per employee in the construction sector, the road construction cost of £15M could support an estimated 12 FTE construction jobs (based on 120 job years and 10 job years per FTE). |
Given total scheme costs for Phase 2 are £2.5M, it is estimated that Phase 2 of the project would generate a total of 13 job years. Using the same 10-year job persistence assumed in the 2015 Business Case, this would equate to 1.3 FTE equivalent jobs. The 13 job years calculated would essentially be the remaining jobs to be realised from the job years calculated in 2015. |
| 3. Indirect construction jobs |
The indirect levered private sector investment in the construction of new employment floorspace, based on an estimate of £40M of construction expenditure, could support a further 30 FTE construction jobs. |
Assumption: £40M levered private sector investment from unlocking 12,000 sqm of employment floorspace Total additional employment generated would be 20 FTE construction jobs based on 10 job years per FTE for a £40M investment. The total FTEs were calculated using 2023 regional (SE) avg. turnover per employee in the construction sector. |
| 4. Indirect jobs |
The indirect jobs arising from occupation of the potential 12,000sqm of employment floorspace is estimated on the basis of established floorspace per job benchmarks (Homes & Communities Agency, 2010) for the proposed floorspace use class. Based on 12,000sqm of B1a office floorspace, the estimated employment capacity of the sites unlocked by the Queensway Gateway Road is 860 gross jobs. Allowing for adjustments for leakage, displacement and multiplier effects, the estimated net additional employment effects are 900 jobs. |
The delivery of the QGR and the potential 12,000sqm unlocked of B1a office floorspace, would support the realisation of previously estimated employment capacity of 900 jobs.
Since the release of the 2015 Business Case, public sector guidelines were updated via the Employment Density Guide (2015). However, employment density guidelines for B1a Offices remained unchanged in the updated version. |
| 5. NPV or GVA (employment benefits) |
GVA benefits per net additional job is measured on the basis of a 10- year job persistence factor and discounted to net present value at the Treasury discount rate of 3.5%. Based on this methodology, the net present value of GVA generated by the potential employment benefits unlocked by the Queensway Gateway Road had been estimated at £296m. |
The Net Present Value (NPV) of GVA generated by the potential employment benefits unlocked by QGR are £392m when calculated using 2023 ONS estimates of output created per job and the 2024 HM Treasury standard discount rate of 3.5% and adjusted for inflation. The NPV was calculated over a 10-year period as in the previous business case. |
| Economic development BCR | BCR 20:1 | BCR 31:1 |
Strategic value-added benefits (2015 business case)
- Economy: Local economic growth
-
- The new road helps towards unlocking land to be released around the road for employment development as set out in Policy E1 of the present Hastings Local Plan 2004 and policies LRA7 and LRA8 of the Hastings Planning Strategy 1
- Accessibility: Improved traffic flows and reduction journey times
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• Improved traffic flows in the surrounding area.
• Improved accessibility and reduced journey times. - Urban integration: Strategic network
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- Without the Queensway Gateway Road the connectivity of the North Bexhill sites to the strategic road network will be constrained and the wider Growth Corridor objectives set
out in the Strategic Economic Plan could be compromised.
- Without the Queensway Gateway Road the connectivity of the North Bexhill sites to the strategic road network will be constrained and the wider Growth Corridor objectives set
- Urban integration: Safety
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- The reduction in congestion leads to reduced stop time at junctions making users less vulnerable to crime.
- People and environment: Active travel
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- Active travel improvements
- People and environment: Biodiversity
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- +10% biodiversity net gain (new!)
- People and environment: Water
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- Improved Water Environment: Ponds Contaminated cleaned and maintained (new!)
- People and environment: Air quality
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- Reduction in traffic congestion and air quality improvements
- Other: Business and resident support
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- Support businesses and enable residents and visitors to move more reliably in and out of Hastings
Hastings Borough Council Planning Strategy
Queensway Gateway Road forms a key infrastructure investment in the Hastings - Bexhill Growth Corridor. Notably, the Queensway Gateway Road provides access to designated employment development sites which would otherwise not be brought forward. The new road allows land to be released around the road for employment development as set out in Policy E1 of the present Hastings Local Plan 2004 and policies LRA7 and LRA8 of the Hastings Planning Strategy. Specifically, the road opens the development potential of key sites south of The Ridge, with a capacity for up to 12,000 sqm of employment floor space.
Blue = allocated site - residential
Pink = allocated site - employment
Purple = allocated site - mixed use
Yellow = allocated site - other
Site reference LRA7 - Land at the junction of The Ridge West and Queensway
Site address: Land at the junction of The Ridge West and Queensway
Allocated use: Employment; B use classes
Area: 3.37ha
Possible floorspace (gross): 6,000m2.
Note - When combined with site LRA8 up to 12,000m2
Site reference LRA8 - Land at the Whitworth Road, The Ridge West
Site address: Land in Whitworth Road, The Ridge West and Queensway
Allocated use: Employment; B use classes
Area: 2.51ha
Possible floorspace (gross): 6,000m2.
Note - When combined with site LRA7 up to 12,000m2