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Laing O’Rourke confirmed on Carillion's Royal Liverpool Hospital

Laing O’Rourke has been officially appointed as management contractor on Carillion’s Royal Liverpool Hospital job, the NHS trust has confirmed.

Royal Liverpool and Broadgreen University Hospitals NHS Trust said it was working with the government and regulator to ensure construction works were restarted as soon as possible.

Construction News first revealed Laing O’Rourke was poised to take over the job in March.

The trust said it hoped the project could recommence as early as next month, with the goal of a 2020 completion.

Laing O’Rourke’s appointment is a result of a deal being struck between the trust and the project’s lenders to terminate the original contract.

This agreement will see the lenders receive a £42m termination fee, plus the rest of the funding held by PFI delivery body – the Hospital Company – at the time of its winding-up.

The trust explained that this figure covered the PFI unitary payments that the Hospital Company will no longer receive, minus the cost of the remaining construction work and the projected cost of maintaining the hospital, both of which will now be covered by the trust.

However, it added that, when calculated in combination with earlier payments made by the trust, the total cost to the public sector of the new hospital will be lower than envisaged when the original 2013 agreement was signed.

It was also confirmed that the £42m figure would be covered by the Department of Health and Social Care.

The NHS trust added that it will take immediate responsibility for the completion and operation of the hospital.

The contractor can restart work on the much-delayed scheme as a result.

Trust chief executive Aidan Kehoe said: “Our priority now is for Laing O’Rourke to get work restarted as soon as possible. We hope to be able to continue working with the existing subcontractors so that work can be completed quickly.”

Laing O’Rourke director Paul McNerney highlighted the firm’s pre-existing relationship with the trust in response to the appointment.

“Laing O’Rourke is delivering the Clatterbridge Cancer Centre next door to the new Royal and had been working closely with the team there already,” he said.

The deal comes after the health minister Stephen Barclay confirmed last month that the government would step in after backing plans by the NHS trust to terminate its PFI deal on the project.

The trust’s CEO told CN earlier this month that escalating costs from remedial work had been the reason behind the collapse of any PFI deal for the Royal Liverpool Hospital project.

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