£1.5bn tender for rail line met with poor response due to risks

HS2 bosses have revised another tender bid to construct part of the new high-speed rail network between London and the North West.

The body is looking again at a £1.5 billion deal to build both track and overhead power systems as a result of a lack of bidders and “increasing concern” from contractors over risk transfer.

Launched in early 2018, the huge tender covers the design, build, installation, testing and commissioning of the track for phase one between London and Birmingham and phase 2a between Birmingham and Crewe. A notice posted online about an upcoming information day said HS2 Ltd wanted to “re-engage with the market” and launch its revised strategy based on market appetite and conditions.

“HS2 has recognised the current market conditions are challenging and the increasing concern regarding risk transfer and have therefore revised our position to provide a better balance and overall outcome,” it added.

A spokesperson for HS2 said the body was aiming to lower the risk for contractors and break up the big packages into smaller ones with the aim of attracting a larger number of bidders, reducing risk and producing a more competitive process.

This latest development comes just a month after HS2 announced it was re-tendering for the contract to build a new £435 million station in Birmingham city centre.

That was prompted by feedback from the construction industry, again about the shared risk of the project.

HS2 said in a statement : “We are currently revising our approach to the procurement of our railway systems contracts in order to increase competition and reduce risk for our contractors.

“These contracts

cover our

track and overhead catenary systems as well as tunnel and lineside mechanical and electrical work.

“Taking these decisions now will help us deliver contracts which, in the long term, deliver best value for HS2 and the taxpayer.”

An industry day about the track and overhead catenary system contracts will take place at the National Conference Centre, in Solihull, on September 3 between 9.30am and 1.30pm.