High Speed 2 Ltd (HS2 Ltd) has clamped down on CH2M seconded employees having anything to do with existing or potential procurement processes involving Jacobs.
In the wake of the Jacobs CH2M merger, HS2 Ltd has removed CH2M seconded employees from Jacobs related areas of procurement work and banned them taking part in future contract opportunities involving Jacobs, in order to avoid potential conflicts of interest.
The measures put in place by HS2 have surfaced following calls from Lord Berkeley, Rail Freight Group chairman and unofficial HS2 watchdog, that either Jacobs or CH2M should be dropped from the job to avoid potential conflicts of interest.
CH2M currently holds the 10 year, £350M contract for the phase 1 delivery partner and Jacobs were revealed by New Civil Engineer to be part of the team supporting the £965M C1 central section for the major civils contract. Jacobs is also shortlisted for Old Oak Common and Birmingham Curzon Street station design packages worth a potential £100M.
Berkeley told New Civil Engineer that, in his opinion, following the merger it was unacceptable for both companies to remain working on the project and ‘Chinese walls’ set up to avoid conflicts did not work.
“In this case, it is not acceptable that you have the same company doing the work and supervising it to make sure it’s been done properly and the costs and the time scale are reasonable,” said Berkeley.
“This is a standard civil engineering structure that you need to have somebody who is totally independent to manage what consultants contractors and project managers are doing. Having Chinese walls is well known not to work. You can demonstrate there is a Chinese wall but the credibility is not there.”
In response HS2 said it had been well aware of the potential conflicts that could arise as a result of the Jacobs and CH2M merger for some months and said steps had already been taken to ensure appropriate controls were in place. It went on to say it was confident the measures put in place were robust.
“These steps include ensuring employees of CH2M working with HS2 have not been permitted to take part in any procurement process involving Jacobs in future contract opportunities. In existing contracts, where necessary, CH2M employees have been replaced in key decision making roles with HS2 Ltd employees.
“To futureproof our relationship with Jacobs and CH2M, we have also developed a Conflicts of Interest Plan, working with both Jacobs and our Conflicts of Interest Panel, to ensure that any actual or perceived conflicts are properly managed.”
HS2 has faced criticism in the past over a seeming ‘revolving door’ for employees between itself and CH2M. At the time Mace challenged HS2’s decision to award the phase 2b delivery partner role to CH2M on the grounds that there had been a conflict of interest involving former CH2M employee and then HS2 employee Christopher Reynolds.
CH2M subsequently pulled out of the role with HS2 awarding it to Bechtel.
As of March last year there were 37 CH2M employees seconded into the HS2 organisation.
Both Jacobs and CH2M have been contacted for a response.