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Lottery projects face tougher checks after Wembley criticism


CULTURE SECRETARY Tessa Jowell last week told MPs that she would tighten scrutiny of 'risky' lottery funded projects before allowing them to go ahead.

Her announcement came after the cross party Culture Media & Sport select committee strongly criticised the way in which lottery cash was spent on redeveloping Wembley stadium.

'I think that we have to be more rigorous in identifying those lottery projects which are exposed to risk, ' said Jowell.

She added that projects would not necessarily be shelved if considered risky, but that they would be checked for best practice by the Office of Government Commerce.

Jowell spoke to the committee after its chairman Gerald Kaufman expressed concern about the way lottery fund distributor Sport England monitored the spending of Wembley's £120M lottery grant.

Last week the committee released an internal report for project company Wembley National Stadium Limited (WNSL) by corporate troubleshooter David James and law firm Berwin Leighton Paisner.

It reveals that the procurement of the project failed to follow accepted best practice.

'WNSL conducted parallel procurement processes for the same contract à therefore making it difficult to have a fully competitive procurement process as MPX (Multiplex) and the other contractors were responding to different tender requirements, ' it says.

James also warns that if the troubled Wembley project was scrapped, WNSL would face bankruptcy and may be unable to repay the £120M lottery grant.

The road to Wembley Wembley procurement timetable, according to the James report June 1999: WNSL decides to invite separate bids for demolition, design, construction and fit out.

21 June 1999: Multiplex offers to handle all three packages combining a guaranteed maximum price with a construction management approach 14 July 1999: WNSL invites 11 contractors to bid for a single contract covering demolition, design and construction, plus fit out August 1999: Five contractors respond, four are shortlisted. Multiplex shortlisted on the basis of its June 1999 offer.

October 1999: Bovis and Multiplex form joint venture and bid on the same basis as other bidders.

October/November 1999: Shortlisted bidders plus Bovis/Multiplex asked to re-tender along the lines of the original Multiplex proposal made in June.

Bovis/Multiplex is the only contractor agreeing to proceed and does so with a non-compliant offer.

January 2000: Three bidders asked to reconsider.

February 2000: Bovis/Multiplex appointed preferred contractor.

30 August 2000: Negotiations with Bovis/Multiplex terminated 1 September 2000: Multiplex alone appointed preferred contractor - terms and legal status of agreement unclear. Project remains on hold until financing details are finalised.

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