High Speed 2 Ltd (HS2 Ltd) chief operating officer Richard Robinson has hit back at accusations that the project’s procurement strategy is encouraging a “race to the bottom”.
Robinson defended HS2 Ltd’s procurement strategy stressing that the delivery body awards contracts to “the best teams for the job” not the lowest bidder, while speaking at the ACE Future of Consultancy conference.
His comments come amid a High Court battle with Bechtel, after the contractor lodged a legal challenge claiming that HS2 Ltd accepted an “abnormally low bid” when it awarded its £1bn contract for Old Oak Common construction partner contract to a joint venture between Balfour Beatty Group, Vinci Construction and Systra (BBVS).
HS2 Ltd’s official defence document submitted to the court denies “each and every allegation” in Bechtel’s claim. In particular it says that there is no basis for identifying BBVS’ tender as abnormally low.
Likewise, while not directly referring to the High Court appeal, Robinson said that HS2 Ltd has “never” awarded a contract solely because it was the lowest bid.
“What we are looking for is the best team for the job, and that is the simple answer from a procurement stand point, because the best team will give us the best result, and the best result is the [bid that provides the] most value,” Robinson said. “We always have that in mind when we are looking at the future of HS2 and who we are working with.
“When I look at our procurement – and I have previously been on the other side of the table bidding for things on HS2 in the past – I don’t see any examples of when HS2 [Ltd] has procured simply on cost alone, that simply is not true.”
Robinson added that he believes procurement models and project delivery is shifting, calling for more prominence to be given to consultants.
“We could see a lot more from consultants working with us at the top table, not content to be tucked away beneath the contractor,” Robinson said.
“Before design and build [contracts], consultants would work hand-in-hand with clients.
“Then someone had the whizzy idea of design and build and that led to contractors becoming much more prominent […] and then the result was for consultants to drop down the value chain.”
He added: “Contractors operating on small margins are squeezing costs wherever they can, rather than focussing on the best outcome.
“However, this is changing and there’s some trends across the whole industry. If you look at the way we are creating delivery teams to carry out design and construction, that represents a fantastic opportunity for consultants to get back at the top table with the client and that is a good thing and something the industry should grab with both hands.”
HS2 Ltd has previously faced challenges over contract awards. In April 2017 Mace objected to HS2 Ltd’s decision to award the phase 2b development partner role to CH2M. Mace was acting on a whistleblower’s information which highlighted a conflict of interest involving former HS2 Ltd employee and now CH2M employee, Christopher Reynolds who was involved in CH2M’s bid.
Spanish manufacturer Talgo also launched legal action last year after what it claims was a “botched procurement” process over HS2 Ltd’s plans to buy £2.8bn of trains.
- To get the full update on what’s happening in the rail sector join us at New Civil Engineer’s Future of Rail conference 26-27 June 2019. Call Ben Joudar on 020 3953 2623 to find out more.
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