Non-starter costs £1m

NEWS - Scottish council cancels schools project after sole bidder spends a million pounds on work-up costs

A SCOTTISH Council has admitted it blew £1 million of public money on an aborted public-private partnership schools project without a single brick being laid.

Dumfries & Galloway Council originally advertised its PPP project in October 2001 and kept it going for nearly four years before ending the project in June.

Documents obtained by Construction News under the Freedom of Information Act show that the council received a grant worth £466,000 from the Scottish Executive. But this ran out in April 2004 and the council used £510,795 of its own budget to fund the programme.

The total spent on the scheme before cancellation was £976,795.

The problems started when the original advert was criticised for focusing solely on unpredictable refurbishments, and the estimated cost of the scheme rose from £60 million to £110 million.

Four consortia qualified for the deal, but Atkins, Jarvis and Morrison pulled out after seeing the detail in the tender documents.

That left Canmore, which comprised Capita Symonds, Amec and Mitie, as the only consortium to bid.

But the council said Canmore's bid 'could not demonstrate value for money' and decided to abort the process.

As revealed by Construction News earlier this year, Canmore was left more than £1 million out of pocket through bid costs.

The council now hopes to go forward with an amended deal, worth £80 million, which focuses almost exclusively on new build.

A spokeswoman for Dumfries & Galloway Council said: 'The council takes responsibility for the money that has been spent so far and this money will have been used to good effect.

'Work undertaken for the previous project is being used as the springboard for the new project. The work includes consultation and the development of the invitation to negotiate, amongst other things.

'To ensure that this project can go forward, a detailed market test has been carried out with potential bidders.

The response has been very positive and there is a good deal of interest in taking part in the project.' The new contract will be advertised in the Official Journal in October.

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