- CH2M chair and chief executive Jacqueline Hinman has written to David Higgins, chairman of HS2 Ltd, to formally advise him of its withdrawal of interest in the Phase 2b development partner contract.
- HS2 Ltd says it will not run the procurement process again.
- Bechtel was second place in the procurement process.
CH2M has pulled out of the £170M development partner contract for the Phase 2b works on High Speed 2 (HS2), with runner-up Bechtel possibly taking over.
The civil engineering sector is now awaiting a decision on the future of the contract after an extraordinary day.
Bechtel was second place in the procurement process and there is now speculation it could be awarded the contract after HS2 Ltd said it would not run the procurement process again.
Rumours were going around on Wednesday morning that the Department for Transport (DfT) would announce a decision on the contract on Friday. However in the early afternoon CH2M chair and chief executive Jacqueline Hinman announced that she had written to HS2 Ltd chairman David Higgins to formally advise him of its withdrawal of interest in the Phase 2b development partner contract.
Project promoter HS2 Ltd awarded CH2M the £170M development partner role in February this year. But losing bidder Mace challenged the decision, asking if there had been a conflict of interest between the two. Current HS2 Ltd interim chief executive Roy Hill and incoming permanent chief executive Mark Thurston had both been recruited from CH2M.
At the time, HS2 Ltd said it had recognised the potential for a conflict of interest and put in place special measures to avoid this.
CH2M today said ‘protracted delays and ongoing speculation risk’ further delayed progress on the national infrastructure project which was increasing costs to UK taxpayers, as well as to the firm.
Despite the move it said it remained fully committed to working with HS2 to deliver its Phase 1 commitments on time and within budget.
A CH2M spokesperson said: “CH2M today provided formal notice to HS2 Ltd that we are withdrawing our interest in the Hs2 Phase 2b contract.
“CH2M has demonstrated all appropriate measures taken throughout to ensure the integrity of the procurement process. Notwithstanding these efforts, we have taken the decision to alleviate any further delays to this critical national infrastructure project which could ultimately lead to increasing costs to UK taxpayers, as well as to our firm.”
CH2M reiterated its reputation gained by work on projects such as Crossrail, the London 2012 Olympics, the most sustainable to-date; Hs2 Phase 1; and the Thames Tideway and Lee Tunnels.
“As is a matter of public record, HS2 Ltd sought clarification from CH2M on a number of areas. CH2M responded to each of these queries in a timely manner. Furthermore, CH2M is clear that it went above and beyond the conflict of interest protocols, as set out by HS2 Ltd,” CH2M continued.
Christopher Reynolds moved from HS2 to CH2M and is understood to have been the subject of some of the questions raised by Mace as part of the dispute process.
“HS2 Ltd were aware of the involvement of Mr Reynolds throughout the procurement process, as documented in CH2M’s bid, which expressly identified Christopher Reynolds and included quotes from him,” said the CH2M spokesperson. “Mr Reynolds’ appointment to CH2M took place 5 months after him leaving HS2 Ltd. Mr Reynolds is a valued member of CH2M staff and brings with him a wealth of technical experience.”
Three bidders were shortlisted for the developnent partner role: first was CH2M, Bechtel was second and Mace was third.
An HS2 Ltd spokesperson said: ”As they have announced, CH2M has decided to withdraw from the Phase 2b Development Partner bid process, a decision which we welcome.”
Industry rumours said transport secretary Chris Grayling had met with the HS2 Ltd team earlier this week to discuss the issue.
A spokesperson for Mace said: “We have just been informed of CH2M’s decision through the press. The investigation regarding our concerns about conflict of interest has clearly raised some serious questions about the process.
”A meeting is scheduled between Mace and HS2 on Friday, and we look forward to hearing what HS2 propose to do next and their response to our questions.
”When millions of pounds of British taxpayers’ money is being spent, the public rightly expect decisions to be made following a thorough process and on a level playing field.”