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Failed Scottish PFI rail project taken over by Network Rail

Scotland’s £295M Borders Railway is now to be delivered by Network Rail after plans to use a form of private finance fell apart in the summer.

Transport Scotland has cancelled the original procurement competition for the project following the withdrawal of two of the three bidders.

Bam remained the only firm willing to bid for the project, originally intended to be procured using the Scottish Futures Trust’s Non Profit Distributing model which harnesses private finance.

Construction giant Carillion confirmed it would not bid to build and maintain the 48km route from Edinburgh via Midlothian to Tweedbank in June.

It was part of the IMCD consortium whose other members are Sir Robert McAlpine and Spanish firm Iridium Concesiones de Infraestructuras. Another consortium, New Borders Railway, pulled out in November last year after Fluor, one of its key members, pulled out.

Network Rail will now run the £235M to £295M project and tender it conventionally. It will then be reimbursed by Transport Scotland.

Scottish transport minister Keith Brown said the government was “steadfastly committed” to the scheme despite the change in procurement.

“Despite early enthusiasm from bidders, it is disappointing that two consortiums dropped out for their own commercial reasons,” he said.

“Following the withdrawal of IMCD from the procurement in the summer, we said we would consider our options to find the right way forward to deliver the project for the best value in the shortest possible time. This announcement concludes that process.”

Ministers are committed to finishing the project by December 2014.

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