Surrey County Council has decided to terminate its contract with Carillion claiming the construction firm not only overcharged taxpayers, but delivered substandard repair work.
The SCC has said that it will not renew Carillion’s contract after its expiry in 2011.
The original five-year contract made Carillion responsible for maintaining the roads in east Surrey.
On the condition that Carillion improved the quality of work and met cost targets, the council extended the contract by three years, despite a 2006 audit report that criticised Carillion’s “unacceptable standards of workmanship”.
A Carillion spokesman said: “The contract was originally a five-year term with a possible year-on-year extension to a maximum of 10 years and we are pleased that we have secured three out of the possible five years permissible through our achievement against a range of performance criteria.”
Councillor Ian Lake, cabinet member for transport at SCC, said the council had decided to terminate the contract because it was “time for a fresh approach”.