Australia’s project to create a A$43bn (£27.5bn) national broadband network could be awarded to one contractor after its promoter suspended its original multi-party tender.
State owned National Broadband Network Corporation (NBN) ended talks with 14 bidding consortiums last week, claiming prices were too high.
It is desperately attempting to show that the project is value for money to taxpayers after a series of natural disasters left the country with a massive repair bill.
The project is the country’s biggest ever infrastructure job.
“Construction companies were unable to provide acceptable terms and prices following four rounds of pricing negotiations,” it said in a statement.
“It would have been much better had NBN sorted out its procurement strategy before engaging the industry”
Jim Barrett, Australian Constructors Association
NBN head of corporate services Kevin Brown said the firm remained committed to building the network “but not at any price”.
“We have thoroughly benchmarked our project against similar engineering and civil works projects in Australia and overseas and we will not proceed on the basis of prices we are currently being offered,” he said.
Australian Constructors Association executive director Jim Barrett said he found NBN’s view “surprising” because there had been a “vigorously competitive” tender process.
He also criticised NBN’s decision not to compensate bidders. He said the industry had spent “millions” responding to the request for proposals.
“It would have been much better had NBN sorted out its procurement strategy before engaging the industry,” he said.
The need for the project has been questioned with the Australian government struggling to deal with the economic impact of floods and a cyclone this year.
NBN has come in for sustained criticism from Liberal Party leader Tony Abbott. Last year he described the broadband project as a “white elephant of a massive scale”.
The eight-year project will make high speed broadband available to 93% of Australian homes and premises, offering connection speeds of up to 100Mb.