Birmingham City Council has awarded Kier a £120m contract to continue delivering highways maintenance services across the city until July 2028, ensuring continuity while the authority prepares a long-term replacement arrangement.
The contract extends the existing interim agreement covering highways maintenance and associated operational services across Birmingham’s road network. Kier currently carries out the work through Birmingham Highways Limited, the council’s subcontractor under the city’s highways private finance initiative (PFI).
Before the current agreement expires on 31 July 2026, the contract will be transferred from Birmingham Highways Limited to Birmingham City Council. The authority will then amend the agreement to run from 1 August 2026 until 31 July 2028.
The council also has the option to extend the contract for a further nine months, potentially taking its duration to 30 April 2029. Any extension will be subject to the availability of funding and Kier meeting agreed performance requirements.
The contract has a value of £120m excluding VAT, equivalent to £144m including VAT, and has been awarded through a direct award procedure.
According to Birmingham City Council, the extension became necessary after the Department for Transport withdrew support for the continued funding of the city’s highways private finance initiative project.
While the council intends to procure a new long-term highways maintenance arrangement, it concluded that an interim extension was required to ensure essential services continue without interruption during the procurement process.
The authority said the contract extension would prevent disruption to highway maintenance operations and enable it to continue meeting its statutory responsibilities for maintaining a safe highway network.
The award decision was made on 21 July 2026, with the contract expected to be signed no earlier than 31 July 2026.
