Mace calls HS2 tendering process over £170m contract "seriously flawed" as it weighs up legal action

Rebecca Smith
How Euston station will look when HS2 is complete
How Euston station will look when HS2 is complete (Source: HS2)

The losing bidder of a contentious £170m HS2 contract has criticised the tendering process as "seriously flawed", saying it continues to mull legal action.

British construction company Mace queried the £170m contract to design parts of the high-speed line being awarded to US firm CH2M, as concerns were raised over potential conflict of interest.

The situation has been under growing scrutiny, with the Transport Committee now saying the contract will be investigated.

Louise Ellman, chair of the Committee, said: "Given the scale of HS2 and the amounts of money involved, the Transport Committee is keen to understand the reasons behind the latest developments. I will be suggesting to Committee members that we hold a session as early as possible after recess. It is important that business, industry and public have confidence in the processes involved."

Mace met with HS2 for further talks over the situation on Friday, after CH2M withdrew its interest from the contract, citing "protracted delays and ongoing speculation".

Read more: CH2M pulls out of controversial HS2 contract due to "ongoing speculation"

But Mace said the talks didn't resolve its concerns at all.

A spokesperson for the company said: "Disappointingly, HS2 Ltd seems dead set on defending what we believe is a seriously flawed process. A process that many would say is further called into question after CH2M's surprise decision to quit. We continue to look closely at our options, and remain hopeful that HS2 will come to their senses."

They added: "In 26 years of working on some of the most iconic projects around the UK and the world, we have never yet taken a case to the High Court, and would not take any decision lightly."

Mace had called for the tendering to be rerun, but HS2 has held firm on proceeding with discussions with second-placed bidder from the original process, Bechtel.

"We are confident that our processes were fair and robust," an HS2 spokesperson said.

Read more: Mace demands whole tender process be rerun for controversial HS2 contract

CH2M pulled its interest in the contract last week, shortly followed by the news that HS2's director general David Prout was leaving to take up a post at Oxford University.

When Mace raised its query over the contract, HS2 delayed awarding it in February, with concerns over conflict of interest.

HS2's current chief executive Mark Thurston joined from CH2M, while the interim boss Roy Hill was also seconded from the US engineering giant. Former HS2 chief of staff Christopher Reynolds has taken a role at CH2M.

Aside from the Transport Committee, other MPs have raised concerns too, with Conservative MP Cheryl Gillan, calling for a full inquiry into HS2 Ltd's dealings with its former contractor, telling the Commons last week that "billions of pounds of taxpayers' money is at stake".

Transport secretary Chris Grayling said CH2M's decision to withdraw from the process was "the right one", saying there was not a "massive misdemeanour" but "an error in process".

Read more: Full steam ahead: HS2 appoints CH2M's Mark Thurston as new chief exec

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