Firms bid high for road work

The first set of bids for the new wave of private roads was submitted to the Highways Agency this week - with the bidding consortia agreeing that the prices will be significantly higher than the Government expected.

Documents were submitted for the A1(M) Alconbury-Peterborough route which the Government estimated would cost œ145 million.

But the prices submitted for the conforming bids - those that the four consortia had to bid for under the terms of the HA's contract - are significantly more expensive than predicted.

All the contractors are keeping their cards close to their chest, but are confident that their alternative bids will prove more attractive to the Government.

One contractor said: 'The Highways Agency eventually agreed to take alternative bids.'

The consortia have had to price on seven variations of the conforming bid. But these include clauses unacceptable to the banks and lawyers which are part of the consortia - so the prices submitted are high to cover what the bidders consider excessive risk.