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Sir Robert chases health job losses

NEWS - McAlpine and Dudley Group of Hospitals agree mediation on £96 million loss

SIR ROBERT McAlpine is still chasing the health trust it blames for costing it £100 million on a scheme to rebuild hospitals in the West Midlands.

The pair have agreed to hold off from a full-scale legal battle in favour of trying to sort out the wrangle through mediation.

McAlpine has accused the Dudley Group of Hospitals NHS Trust of giving it 'little or no co-operation' on the scheme, which, it claims, resulted in the contract being delivered late and over-budget.

In its latest report and accounts, McAlpine said: 'The Group has continued to pursue the trust and the NHS to recover very substantial sums for additional work and the costs of disruption and delay.' McAlpine made a £72 million loss on the contract in 2004, adding to the £24 million loss it had already booked in 2003. The job was finally completed in March 2005, six months behind schedule.

Trust chief executive Paul Farenden said: 'Both parties have agreed to undertake a formal process of mediation to clarify some remaining matters following the completion of the new hospital programme.' Work involved refurbishing and rebuilding two wings at Russells Hall hospital in Dudley as well as building two ambulatory centres at Corbett hospital in nearby Stourbridge, and Guest hospital, also in Dudley.

Turnover at McAlpine in the year to October 2005 passed £1 billion for the first time at £1.1 billion, up from £847 million the previous year.

The firm returned to the black, with pretax profits nudging the £20 million mark from a £26 million loss last time.

The bulk of McAlpine's work is contracting and this business made an operating profit of £6.5 million on turnover of £810 million in 2005. The firm's problems at Dudley blew a £54 million hole in the division's accounts the previous year.

Its next largest business is wind energy, with sales of £183 million, producing operating profits of £5.9 million.

The highest paid director saw his pay packet climb 7 per cent to £307,000.