The negotiations over Workplace 2010 were suspended at the end of October last year whilst the two remaining bidders prepared to merge – another unsuccessful bidder, Partenaire, which brought a legal challenge to the procurement process in August 2007, was awarded damages in a confidential legal settlement in January last year. The Irish News reports today that the 3 and a half year long negotiations have now been terminated “putting the process right back to the start”. [subs req]
Government expenditure on the contract negotiations for the failed project is estimated at between £12million and £15m. The treasury has also lost out on up to £175million in revenue that would have been paid to the government by the successful bidder for the commercial value of its land. The value of the land has plummeted due to the financial crisis.
Sir Richard Needham, chairman of Telereal’s advisory board for the Workplace 2010 bid and a former economy minister in the north described the collapse as “one of the worst and most appalling disasters I’ve seen in my public life”. “It is an absolutely disgraceful saga of political and civil service failure. This tender process has been going on for an exceptionally long time for a PFI,” he said.
A DFP official said that even though the final two bidders for the contract had been told it could not go ahead with them, this did not mean the contract had collapsed.
“We are reviewing the procurement during the suspension and will decide on a way ahead over the next few weeks,” the official said.
DFP declined to speculate over the potential cost and timeframe for rerunning the bidding process.
But according to Sir Richard Needham, there is no fallback.
“The department was told privately months ago that this merger was going to happen and they should have speeded up the process but because they spent so much wasted time and money, I now can’t see any circumstances under which Telereal would be prepared to come back to the table,” he said.
“Even if they tried to restart this process I can tell you now most of the serious bidders in this process wouldn’t come back and commercial property prices have collapsed anyway.”
The government’s handling of the Workplace 2010 contract was criticised in January last year after Partenaire, and unsuccessful bidder for the deal, was awarded damages by a court in a confidential legal settlement.
The Irish News understands the basis for the financial settlement, which has remained secret until now, was mismanagement by DFP.