A risk worth taking

8 November 2010

9 November 2010 | Lindsay Clark

Edinburgh City Council took a “pragmatic view” when it transferred a contract originally won by Connaught to another supplier without a fresh tendering round, a lawyer has said. 

The authority handed a housing improvement deal to building firm Wates Construction, after the winner of its tendering process, Connaught, went into administration.

Edinburgh arrived at the decision despite Norwich City Council receiving legal advice not to transfer a contract held by Connaught to a new supplier on a permanent basis without a new tender process because of EU procurement rules.

However, a spokesman for Edinburgh City Council said: “As with all awarding of contracts, legal advice was taken to ensure that EU procurement rules were followed.” 

Richard Tinham, a partner at Winckworth Sherwood solicitors, said although the approach may not be strictly compliant, the risk of a challenge was reduced if two things occurred. Namely, the council could demonstrate a transparent scoring method in its initial tender, and prove it was awarding the company that came second in the competition.

“It does not necessarily make it a compliant appointment, it just means its one where there is less risk associated with it,” he said. “It is a pragmatic way of mitigating risk and getting a result.”

Edinburgh has avoided another bidding round, but the council has incurred greater cost in the transfer of the contract to Wates. The Wates bid was £700,000 higher than Connaught over the deal’s four-year lifespan.

However, the authority insisted the new deal could be managed within the £9.25 million budget to deliver the planned programme.


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