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Carillion: Midland hospital delay triggers subbie desertion fears

Fresh delays to the £353m Midland Metropolitan Hospital due to Carillion’s collapse have sparked fears that subcontractors could desert the scheme.

MP for Warley John Spellar told Construction News that extended delays to restarting the Smethwick hospital could see subcontractors and workers leaving the PFI project in search of alternative work.

The comments come after Sandwell and West Birmingham Hospitals chief executive Toby Lewis said the project team was now searching for a contractor to replace Carillion, a process that could take “weeks, if not longer”.

Mr Spellar said: “My concern is if they leave it too long, the subcontractors and particularly the workforce will start to head off on other jobs, they can’t just wait around week on week.

“This is all going to end up costing a tonne of money, you cannot leave this as a towering monument of failure.”

In his latest update on the scheme, Mr Lewis said his team was working “around the clock” to ensure the hospital was built as rapidly as possible.

He said: “The partners that form the Hospital Company [Sandwell] have a responsibility to find a new builder and new contractor that can finish the job.

“We will experience some weeks, or even longer, when the cranes are not active, but what is really important is that we get the senior leadership team that were working on the project to continue to work.”

The Midland Metropolitan Hospital is understood to be one of the major projects that contributed to Carillion’s collapse, alongside the £335m Royal Liverpool Hospital PFI and the £535m Aberdeen Western Peripheral Route.

Construction News reported last week that the Royal Liverpool Hospital job was also facing long delays after subcontractors refused to return to the site over unpaid work.

CN has learned that work on the Midland Metropolitan site was halted following Carillion’s liquidation, with the gates locked and a number of workers laid off. 

It is understood that Carillion’s project managers have been maintained on the project and will be supporting the hospital in developing plans on how to finish the scheme.

Subcontractors working on the site have told CN that they have been kept in the dark over future of the project.

One subcontractor said: “We haven’t had any word; we are keen to keep working on the scheme but haven’t had any communication with [liquidation managers] PwC yet.”

A spokeswoman for the hospital’s building services contractor NG Bailey said: “We remain fully committed to the project and we are awaiting clarification as to how the project will continue and move forward to completion. We expect this could take some time.”

Mr Spellar said losing just a handful of subcontractors to other schemes could disrupt the sequencing of the construction programme.

“Putting it all back together again and getting teams to work back in sequence will be difficult, because one trade might be leaving for another job and won’t want to come back to this troubled job,” he said.

This is the second high-profile delay to the Midland Metropolitan after the client confirmed in September last year that its completion date would be pushed back following issues with the M&E design.

Construction News reported in September that M&E issues would see the project completed in early spring 2019, six months later than the initial completion date of October 2018.

The scheme also saw one of its M&E contractors, MVS Mechanical Services, fall into administration just before Christmas.

Readers' comments (1)

  • I can only hope that the 'Senior Managment Team' are NOT using a lowest bid / competitive tendering model, again, but this time have opted to take on board the suggestions / Best Practice Guidance in the "Modernise or Die" report and develop a 'Joint Partnership' model of deliverin gthe project?

    We keep being told that this is the opportunity of a lifetime and cause for a seismic shift in the construction industry and how projects are delivered. Lets lead from the front and try something 'different' (that is a proven, reliable model) but not the one the managers may have 'grown up with'!

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