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Cash flow dispute simmers at Jubilee
00:00 06 Apr 1995
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A row is brewing between contractors and London Underground over
payment for claims and variations on London's massive Jubilee Line
Extension project.
Two contractors working on major parts of the œ1.9 billion scheme have told CJ of problems with cash flow on the scheme and have complained that design changes have caused many changes to the work which they say so far have not been properly paid for.
But the project team has strenuously denied claims that there is no dialogue or that payments are being deliberately held up.
JLE project director, Hugh Doherty, said: 'It is just not the case that we are not dealing with the contractors' claims. If there is a reasonable claim then the contractor must substantiate it to the engineer who will then adjudicate. The key to resolving the claims is proper substantiation by the contractors.'
But one contractor working on the scheme said there are 'serious political stand-offs' on the project which they say could eventually result in legal action.
'We are severely in debt on this project with a hugh quantity of claims outstanding,' said the contractor. 'JLE is not honouring or paying claims and this is a general problem.'
Another contractor explained that changes in design on the scheme had been numerous. 'We will do the work but only if we are happy that we will get paid,' he said.
Design changes are initiated by engineers' instructions which contractors must then formalise by requesting variation orders (VO's).
'There are VO requests which have been outstanding for nine months,' said a contractor, 'and payment is even then considerably delayed.'
Doherty agreed that there had been 'one or two areas where design changes have occurred' but said that they can lead to different views on how variations are dealt with. 'If the contractors are having problems,' he said, 'they can come and see us.'
n Wimpey has been given clearance to work round the clock on two elements of Contract 106 on the JLE project - the bridge beam construction and trackwork.
Two contractors working on major parts of the œ1.9 billion scheme have told CJ of problems with cash flow on the scheme and have complained that design changes have caused many changes to the work which they say so far have not been properly paid for.
But the project team has strenuously denied claims that there is no dialogue or that payments are being deliberately held up.
JLE project director, Hugh Doherty, said: 'It is just not the case that we are not dealing with the contractors' claims. If there is a reasonable claim then the contractor must substantiate it to the engineer who will then adjudicate. The key to resolving the claims is proper substantiation by the contractors.'
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But one contractor working on the scheme said there are 'serious political stand-offs' on the project which they say could eventually result in legal action.
'We are severely in debt on this project with a hugh quantity of claims outstanding,' said the contractor. 'JLE is not honouring or paying claims and this is a general problem.'
Another contractor explained that changes in design on the scheme had been numerous. 'We will do the work but only if we are happy that we will get paid,' he said.
Design changes are initiated by engineers' instructions which contractors must then formalise by requesting variation orders (VO's).
'There are VO requests which have been outstanding for nine months,' said a contractor, 'and payment is even then considerably delayed.'
Doherty agreed that there had been 'one or two areas where design changes have occurred' but said that they can lead to different views on how variations are dealt with. 'If the contractors are having problems,' he said, 'they can come and see us.'
n Wimpey has been given clearance to work round the clock on two elements of Contract 106 on the JLE project - the bridge beam construction and trackwork.
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