The Royal Liverpool hospital trust has revealed it will pay Laing O’Rourke’s specialist trade contractors direct as part of the deal hammered out to restart work on Carillion’s stalled hospital project.
Latest board papers also reveal that Mace has also been drafted in the oversee the project and manage risk for the Trust after Laing O’Rourke said it would not take responsibility for cost or hand-over date as part of its restart deal.
Laing O’Rourke, which is managing the construction contract, has already started some minor early works. It is anticipated that the main construction work will commence early in the New Year.
The board papers ahead of tomorrow’s meeting state that the agreement sees Laing O’Rourke with a very different set of responsibilities to those carried by Carillion.
As a result, the board had decided to strengthen the trust’s project team to enable it to run the project.
“Laing O’Rourke was not prepared to take any risk on either construction cost or timetable to complete – these risks sit with the trust which we will manage through Mace and the in-house project team,” reveals trust chief executive Aidan Kehoe.
In his summary, Kehoe adds: “One key safeguard going forward is that the trust will make payments to Laing O’Rourke’s subcontractors directly.
“This means that should the same situation befall Laing O’Rourke as it did Carillion, then the trust would simply look to appoint a new contract manager. Subcontractors would continue to work and get paid as normal.
“Whilst some delay may be inevitable, the subcontractors would be kept whole and there would be no risk to the project being completed. ”
He added that the PFI termination agreement provided significant savings to the public sector and represented good value for money for the taxpayer.
All parties have worked extremely hard to resolve the issues caused by Carillion, and the lenders, Legal and General and the European Investment Bank have shown tremendous goodwill in reaching a final solution, he added.
from Construction Enquirer http://www.constructionenquirer.com/2018/11/26/royal-liverpool-trust-to-pay-laing-orourke-trade-firms-direct/
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