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Govt not to blame for soaring Senedd costs

The Welsh Assembly Government did all it reasonably could to keep a lid on the cost of its troubled Senedd construction scheme, a public sector watchdog has ruled.

The Assembly's Audit Committee said the Government had put “sufficient measures” in place to control building costs of the complex – which was constructed by Taylor Woodrow – despite a blow out of more than six times the original £12 million estimate.

It blamed the rising cost on, among other factors, "a lack of robustness" in early estimates and unforeseen security requirements after 9/11.

Work on the scheme, which began in 1997, was halted in 2001 due to spiralling costs which had risen to some £40 million.

A fixed-price contract for £66 million was then signed with Taylor Woodrow in 2003 and the building was eventually delivered for nearly £70 million.

In its report, the cross-party spending watchdog applauded the Government’s decision to put a hold on the project, but said on re-tendering there was “a disappointing response from the market”.

Taylor Woodrow and David McLean, which went into administration late last month, were the only two companies to submit formal tenders. The Government was hoping for at least four competing bids.

The report said: “To complicate matters further, David McLean’s bid did not comply in one respect with the stipulated requirements of the Assembly Government. This left only Taylor Woodrow in the process.”

It acknowledged that, in order to maintain a degree of competition, the Government had worked out an agreement with David McLean to “be a fall-back” if Taylor Woodrow failed to agree a fixed-price contract.

Possible reasons for the lack of response, the committee said, were the well-known problems of the earlier phase of the project and the fact that there were other high profile projects in Wales at the time that were having difficulties, such as the Millennium Centre and the Millennium Stadium.

Despite the challenges also presented by its ambitious design, the Senedd came in "broadly" within its final budget, the committee said.

However it warned the Government that it needed to take lessons from the problematic scheme and apply them to other projects currently on the table under the Assembly’s relocation strategy.

The report concluded: “We recommend that the Assembly Government provide a note to this committee by the end of December 2008, setting out how the lessons learnt from the Senedd are being applied to the other building projects that it is managing.”