Latest Rail News

30.03.17

CH2M pulls out of HS2 Phase 2B development contract

CH2M has confirmed that it has withdrawn its interest in the Phase 2B development contract for HS2, the company has revealed.

The £170m bid was awarded to the engineering firm in February after an 11-month competitive bidding process, but the signing of the contract was delayed after rival bidder Mace threatened legal action over HS2 Ltd’s handling of the procurement.

Mace commented that it had “never seen a procurement process like this”, and argued that conflict of interest was only one element of why it had launched an enquiry into HS2’s conduct.

This latest development caps off a miserable few days for HS2, as last Friday RTM revealed that the award of £8.6bn worth of civil contracts had been pushed back to June.

Now it has been confirmed that the chair and chief executive of CH2M Jacqueline Hinman wrote to HS2 Ltd chairman David Higgins to formally advise him of the company’s withdrawal from the project.

A spokesperson for CH2M said: “CH2M has demonstrated all appropriate measures taken throughout to ensure the integrity of the procurement process. Notwithstanding these efforts, we have taken the decision to alleviate any further delays to this critical national infrastructure project which could ultimately lead to increasing costs to UK taxpayers, as well as to our firm.

“CH2M’s reputation reflects excellence earned by placing the interests of our clients and communities first, best exemplified by our delivery of vital programmes like Crossrail, the London 2012 Olympics, the most sustainable to-date; HS2 Phase 1; and the Thames Tideway and Lee Tunnels.”

A spokesperson for Mace stated that they were looking forward to meeting with HS2 leaders tomorrow to hear answers about the procurement process.

“It’s important to note that conflicts of interest was only ever one element of our concerns,” the spokesperson said. “With so many questions being asked by the public and parliament, the only sensible thing to do now is to look at the whole tender process again.

“In our 26-year history, working on some of the UK’s most iconic projects, we have never brought a case to the High Court or seen a procurement process run like this.

“We continue to closely review our next steps with our legal team and don’t rule anything out.”

An HS2 spokesperson said:"As they have announced, CH2M have decided to withdraw from the Phase 2b Development Partner bid process, a decision which we welcome.”

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Comments

Lutz   30/03/2017 at 15:32

It is very disturbing that to hear that there are problems with HS2 Ltd.

Pdeaves   31/03/2017 at 11:55

The last statement is quite telling: "CH2M have decided to withdraw ... a decision which we welcome". Usually you would expect to see the company 'regretting' another's decision with a wish to work together again in the future. I wonder what deeper issues there are.

Railengineer   31/03/2017 at 12:48

Will the HS2 Loading gauge be at least UIC A? UIC C or larger would be good.....

Paul Bowers   31/03/2017 at 12:57

It's time to pull the plug on HS2. Nobody wants it and we can't afford it.

MJM Mcevilly   31/03/2017 at 13:46

Believe that Mace subsequent involvement in this project cannot be considered by virtue of impartial judgment.

Rodger Bradley   31/03/2017 at 14:42

"The £170m bid was awarded to the engineering firm in February after an 11-month competitive bidding process, but the signing of the contract was delayed after rival bidder Mace threatened legal action over HS2 Ltd’s handling of the procurement." This does not seem unusual in the UK Gov's approach to tendering and procurement contracts - you would think that by now they'd have a handle on the way the processes should work. Given these protracted negotiations I cannot see how - without the aid of a chocolate teapot! - HS2 will ever see completion. This is just adding to the eventual cost overruns. Unless there is a desperate need for people from either Birmingham or London to get out of the respective cities at high speed - the digital infrastructure/economy will render this project a pointless exercise.

Mark Hare   31/03/2017 at 15:11

@Paul Bowers - HS2 is happening, deal with it. 'Nobody wants it'? It's essential for increasing capacity, simple as that.

Wimg   01/04/2017 at 10:13

" Usually you would expect to see the company 'regretting' another's decision with a wish to work together again in the future " Carelessness seems to be the word these days ..

Chris M   04/04/2017 at 02:19

As this relates to the design of phase 2b before legislation is introduced to Parliament in 2019 it should not cause delays. However HS2 Ltd need to take heed from this that all contract decisions using public money need to be seen as transparent. To retain the confidence of bidders the processes need to be seen as open, truly evidence based and impartial. Things have changed a lot since the days of apparent government endorsed corruption surrounding the awarding of the M1 build contract to a family firm by Ernest Sharples (who later decamped to Monaco to avoid prosecution over his tax affairs).

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