Cambridgeshire County Council has announced it is seeking a government-funded public review of the NEC forms of contract,after further disputes with contractor Bam Nuttall over its new guided busway.
Review “of national importance”
The council said it will carry out an independent public review of the NEC 2 Target Price contract used on the project. It is to ask central government for funding because it believes such a review will be of “national importance”.
It said the review would “make sure other people who use this contract do not have the problems we have faced with Bam Nuttall”, said Cambridgeshire cabinet member for growth, infrastructure and strategic planning Roy Pegram.
The £117M Cambridgeshire Guided Busway project suffered disputes between client and contractor over design changes, delays and alleged defects in work. These led to the council going public about them in March (NCE 11 March).
A council spokesman said an internal review of the project was always planned, but the council’s cabinet has now decided to turn it into a public review led by a contractual expert, with evidence to be heard in public and the final report published.
“We were always going to have a review once the project was completed to see if there were any lessons we could learn,” he said. However, he said a new dispute over whether Bam should install lighting at a junction was the “final straw”, even though the contractor eventually agreed to install the lighting.
The review will assess “just how well this standard civil engineering contract has worked and been applied by both parties,” said the spokesman.
NEC contracts originator Martin Barnes said the disputes cannot be blamed on the contract itself.
“Everything which Cambridgeshire now appears to be unhappy with should have been apparent from the contractor’s design which the client had the duty to check and accept or reject,” he said. “I don’t think we need a public enquiry about NEC. It usually works fine when people do what the contract says they have agreed to do.”
“Significant use is still made of the ICE conditions”
Rosemary Beales, CECA
A council spokesman said no work had yet started on the review as it is “really too early”, adding that it may not begin for “a number of years” because it will have to be delayed until the outcome of any legal action with Bam Nuttall is known to avoid prejudicing court proceedings.
The council said legal action over the project disputes is “inevitable”. “The legal process could take quite some time to be done and dusted,” said the spokesman.
An independent review will provide a full investigation into the problems that have been faced without the multi million pound bill of a legally based public inquiry, said the council.
In the same week that the council sought a review of the NEC, the Association for Consultancy & Engineering (ACE) and the Civil Engineering Contractors Association (CECA) announced their commitment to maintaining the ICE Conditions of Contract as contracts of choice. By contrast, the ICE said it would no longer maintain the ICE Conditions but would focus on NEC 3 (NCE 5 August).
“Commitment to both contracts”
CECA national director Rosemary Beales said CECA and the ACE were committed to ensuring there is continued choice between the different forms of contract. “Significant use is still made of the ICE Conditions for infrastructure and associated work,” she said.
The NEC was the first standard contract to acknowledge partnering between all the parties and seeks to avoid litigation through mediation. Bam Nuttall has a design and build contract for the guided busway, and detailed design has been undertaken by a joint venture between Arup and Parsons Brinckerhoff.
Costs for the scheme were put at £116.2M − including £87M for construction − when the contract was let in June 2009. Bam Nuttall’s forecast for actual costs has reached £145M but the council said this could be reduced if works are undertaken “efficiently”. The firm has had almost £14,000 a day deducted for late delivery of the project since February 2009 º a total in excess of £7M so far.