Further Faults for HS2 Procurement Process

hs2-high-speed-railIn a further blow to the planning and construction of HS2, thevast multi-billion pound project to improve the UK’s transport infrastructure, companies bidding for the £10 million commercial services contract have just been informed that the process must be dismissed and rerun due to possible conflicts of interest.

HS2 is seen as a once-in-a-lifetime opportunity to rebalance the national economy and connect eight out of ten of the largest cities in the UK. At the same time, it would transform travel and improve capacity on the rail network for passengers.

Phase 1 was originally intended to cost £24 billion, but costs have recently soared to more than double that, estimated to be between £48 and £54 million. The entire three phases, 1, 2A and 2B were supposed to cost £48.7 billion (excluding rolling stock) leading to questions about where the additional funding for the second phases will come from should the first phase use the entire projected budget.

In addition, there have been other issues with the procurement process. Firstly,  £8.6 billion of civil contracts which were expected to have been awarded last month have been pushed back to June, following the requirement from HS2 for extra information for the seven mainly construction packages to be bid for as part of Phase 1. Further, CH2M have recently pulled out of a £175 million civil contract for Phase 2B, following complaints from a losing bidder about the procurement process and threats of legal action.

As a result of these issues surrounding the procurement process for such a large and costly project, the government’s Transport Select Committee will be launching an investigation into procurement activities, stressing the importance of business, industry and the general public having confidence in both the process and the project.

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