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UKCG: Contractors should seek compensation

UK Contractors Group director Steven Ratcliffe has warned the Government that contractors will expect compensation for their bid costs on aborted Building Schools for the Future Schemes.

Mr Ratcliffe said contractors had lost upward of £100 million on schools which will not now be built, and had no hope of recouping their costs from additional BSF work.

He said: “The industry has spent all of this money at the behest of the Government, so it doesn’t seem unreasonable for contractors to expect some compensation.”

But he said they should wait for the review of the schemes which had reached preferred bidder sratus.

Contractors had reached preferred bidder status on 14 nationwide schemes when the education secretary pulled the plug on BSF on July 5.

There will be a review of these schemes, carried out by the BSF delivery body, Partnership for Schools. But PfS will only decide whether any of teh sample schools in these proposals will go ahead.

Nicholas Taylor, a partner at law firm Davies Arnold Cooper said reaching preferred bidder status could have cost contractors as much £7.5 million per scheme.

And he urged the industry to push for compensation. He said: “I believe the industry will come together and put pressure on the government to make a pot available. If the government is not proposing to make a pot available, then the contractors will have to try to make them think again.”