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Morgan Est lays off staff in its tunnelling team as delays drag on infrastructure

The tunnelling division of Morgan Est has had to lay off staff, as cutbacks and delays on major infrastructure projects hit home.

Though the company has declined to comment on the numbers at risk, Construction News understands that nearly half of the division of 91 could be let go.

A company source told CN that delays to three major jobs had hurt the division: the £695m Victoria station upgrade contract; the £400m Lee tunnel; and a £470m National Grid tunnelling job.

Transport for London told CN this week that there had been no delays to the Victoria station upgrade, and the contract would be let in the autumn as planned, with work starting next year. Reports have suggested that bidders had hoped for a decision in August but were told to wait until this month.

The National Grid work was due to be awarded in January this year. But a winner is yet to be selected.

The source also said National Grid was now seeking tunnels that are 3 m in diameter rather than 4 m, and consultants had been brought in to drive down costs further.

National Grid admitted this week it had reviewed the scheme – a “standard business practice”, it said, adding: “We are still looking at building a number of tunnels in the London area and the first scheme to go ahead will be Hackney to St John’s Wood and St John’s Wood to Willesden.”

The Lee tunnel winner was to be announced in September. Thames Water said this week it hoped to announce a winning bidder before Christmas.

It is unclear how many staff have been let go by Morgan Est as a result of the problems. Internal documents seen by CN suggest that as many as 43, out of a total at the start of September of 91, could go by the end of November.

The Morgan Est source said: “We had a wonderful team. With them not awarding these contracts, people disperse.”

A spokeswoman for Morgan Est, the civils division of Morgan Sindall said: “We have a number of major schemes coming to an end, with new ones expected to come online next year.

“No final decisions as to the number of redundancies will be made until the conclusion of any collective and individual consultation processes.”