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Expensive local authorities denied road maintenance contracts

LOCAL AUTHORITIES failed to win the four recently awarded regional Scottish road maintenance contracts because their bids were 50% more expensive than the private sector competition, the Scottish Executive claimed last week.

Their bids would also have increased the cost of road mainentenance in Scotland by 27%, the Executive said.

Road maintenance in Scotland is now divided into four regional packages.

Until recently work was split into more packages and carried out by individual local authorities.

The Scottish Executive confirmed the award of four regional trunk road maintenance and operation contracts to private sector bidders, silencing calls from local authority consortia for the work to be retendered (NCE 11 January).

Contractor Amey Highways has the south east and south west Scotland regional contracts.

The private sector Bear Scotland consortium has won the north east and north west packages.

The contracts, to run for five years, were bid at a collective value of £353M.

The Scottish Executive said it would make a £75M saving on previous operating and maintenance costs over the contract period.

The Executive produced comparative figures from a report produced by consultants Halcrow and PriceWaterhouseCoopers.

They were questioned by one of the local authority teams, which said it did not recognise its own bid value in the figures.

Four local authority bidders sought legal action against the Scottish Executive, claiming its tender procedure was anti competitive and misleading.

They pleaded that awarding the work to private companies would result in up to 3,500 job losses from local authority engineering departments and direct labour organisations.

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