Newcastle raises ire as it pulls another big job

City council cancels £220m framework procurement deal in favour of other methods as volumes fall

CONTRACTORS have been left fuming after Newcastle City Council pulled the plug on another £220 millionworth of construction work.

The council had advertised for firms to join the fouryear framework deal, comprising work on housing, education, leisure and other public buildings.

But the framework was cancelled after the council decided there was too little work for the deal. It now expects to use alternative procurement routes for future work.

It is not the first time Newcastle officials have dropped work plans.Thirteen contractors - nicknamed the 'lucky 13' - had been selected for up to £440 million of work under a previous deal but it was cancelled in favour of the framework.

One national contractor said: 'We didn't even bother applying for the framework as the last one was such a shambles. The council had asked how the scheme should be structured and they received 200 different suggestions, which was a farce.Then they pulled the plug.

'I feel sorry for those that applied for the last one and then this one too. It costs time and money and the forms you have to fill in are a nightmare.Firms have gone through meetings, presentations and selection processes and the council ends up saying 'oops, we're not going to do it' again.'

One contractor that had been expecting work said:

'The smaller firms in particular are going to be disgruntled as they don't have the financial clout to pick up work through other procurement routes.'

Another said: 'There's a huge wealth in the northeast marketplace and it isn't being used as well as it should by the council when everything ends up being PFI or similar.'

A source at Newcastle City Council said: 'The council had a review of the work streams and felt that the work coming through traditional routes was not as great as when we went to the Official Journal.'

The council has a history of problems during tendering. In March, Equion, Kier and Kajima were left in limbo after the council postponed plans for a new library.The council is now waiting until June to see if it can raise the required funds.

In 2004 Newcastle cut a highways partnering deal, which could have been worth around £280 million to around £30 million.

Subscribe to Construction News
Sign up for a Corporate subscription to Construction News

Visit CNinsight - the construction industry data service from Construction News
« »