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Transport for London (TfL) will carry out a full review of its Silvertown Tunnel procurement process, after paying out £10M to disgruntled losing bidder Silver Thames Connect (STC).
Agenda papers released ahead of next week’s TfL Finance Committee meeting confirm that TfL paid STC an out of court settlement in relation to Silvertown Tunnel in March. As previously reported by NCE, the settlement is believed to be in the region of £10M.
The settlement comes after two years of legal wrangling, which began after TfL named the Riverlinx consortium (consisting of Ferrovial subsidiary Cintra, Bam PPP PGGM, Macquarie Capital and SK E&C) as preferred bidder for the Silvertown Tunnel contract in May 2019.
STC (comprising Hochtieff, Dragados and Iridium Concesiones de Infraestructuras) claimed its bid was better value for money and started legal action in August 2019 in order to suspend the project. The suspension was lifted two months later, but STC continued to pursue damages.
In its court submission, STC slammed the procurement process as being “flawed, in breach of the principals of equal treatment […] and manifestly erroneous”. It also accused TfL of flouting its principals of “transparency” and “non-discrimination”.
STC claimed that it “should have been the winning bidder” on the grounds that it “scored significantly better than Riverlinx on price”.
It also claimed that TfL “failed to treat STC fairly, transparently or equally” which led to “manifestly erroneous” scoring in relation to commercial aspects of the contract.
The latest meeting agenda papers add that “a procurement lessons-learned exercise would be undertaken” as a direct result of the out of court settlement.
The review will be carried out by TfL’s Independent Investment Programme Advisory Group and will report its findings in October.
A TfL spokesperson said: “As is standard on all TfL projects, we will be carrying out an internal review into the Silvertown Tunnel tendering process to ensure that any lessons learned from the procurement can be implemented for future projects”.
The £10M settlement is in addition to £56M already spent by TfL on the controversial project, as revealed by NCE last month.
The £56M spend represents a £50M increase in TfL spending on the project in the three months since the last TfL Programme’s and Investment Committee meeting took place in February.
The latest meeting agenda papers also reveal a £5M reduction in the estimated final cost of the project, with TfL’s final direct costs now at £197M.
The 1.4km twin bored Silvertown Tunnel is set to be completed in 2025 and will connect south London with the Tidal Basin Roundabout in Silvertown, in a bid to relieve congestion at the Blackwall Tunnel.
Department of Civil Engineering https://www.ibu.edu.ba/department-of-civil-engineering/
