Surrey County Council (SCC) has decided to terminate their contract with Carillion claiming the construction firm not only overcharged taxpayers, but delivered substandard repair work.
The SCC has said that it will not renew Carillion’s contract after its expiry in 2011, and has also decided not to extend its contract with Ringway, as it emerged in 2006 that Carillion had overcharged taxpayers by around £1.1M through shoddy repairs and overcharging for fixing potholes.
Carillion paid back the £1.1M, and a spokesperson for Ringway said that that firm had paid back a goodwill gesture of £170,000 too.
The original five-year contract made Carillion responsible for maintaining the roads in east Surrey, while Ringway had a contract for west Surrey.
“Unacceptable standards of workmanship”
2006 audit report
On the condition that Carillion improved the quality of work and met cost targets, the council extended the contract by three years, despite a 2006 audit report that criticised Carillion’s “unacceptable standards of workmanship”.
A Carillion spokesman said: “The contract was originally a five-year term with a possible year-on-year extension to a maximum of 10 years and we are pleased that we have secured three out of the possible five years permissible through our achievement against a range of performance criteria.”
Councillor Ian Lake, cabinet member for transport at SCC, said the council had decided to terminate the contract because it was “time for a fresh approach”.
The Ringway spokesperson said that when the council offers a new contract, “Ringway will certainly be tendering for that”.