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Losses 'hit £30m' as MoD centre runs late
00:00 02 Dec 1998
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Exclusive by James Atkinson
The Royal Navy's new £45 million command centre project at HMS Warrior, Northwood, West London is running over three years late amid design and specification problems, it emerged this week.
Main contractors BAe Defence Systems and John Laing together with mechanical and electrical subcontractor James Scott are understood to be facing heavy losses.
Sources close to the project say Laing could be facing a loss in the region of £25-30 million. James Scott, part of the Amec Group and subcontracted to Laing, is thought to have run up losses of around £12.5 million on its £5 million M&E installation contract. The M&E firm is now in the process of claiming off Laing and is seeking an arbitration hearing.
Both Laing and Amec refused to comment on the situation.
The project was originally due to finish in September 1995. Last week the MoD admitted that a revised deadline of summer 1998 had been missed and that work on the scheme is still underway. An MoD spokesman said: "The programme has slipped and we are in negotiations with the contractors to resolve the situation."
Sources have indicated that the project will not be completed until Easter 1999. The MoD refused to give a revised completion date or any indication of the cost overrun.
It is not clear what recourse Laing has to claim back its losses. The MoD previously stated that the contract is for a fixed price.
It is understood that contractors have been making strenuous efforts to finish the project, working seven-days-a-week and 24-hours-a-day, incurring higher than anticipated costs.
Laing is part of the Eagle Consortium, led by prime contractor Siemens Plessey Defence Systems, which became BAe Defence Systems in April 1998. The consortium also included Tarmac design consultancy firm TBV Consult (now part of Tarmac Professional Services) - responsible for the outline M&E design, and INRI UK and Digital Equipment at the computer end of the project. The consortium was awarded the design and build contract for the CTF 345 Command Centre project in May 1994.
The Royal Navy's new £45 million command centre project at HMS Warrior, Northwood, West London is running over three years late amid design and specification problems, it emerged this week.
Main contractors BAe Defence Systems and John Laing together with mechanical and electrical subcontractor James Scott are understood to be facing heavy losses.
Sources close to the project say Laing could be facing a loss in the region of £25-30 million. James Scott, part of the Amec Group and subcontracted to Laing, is thought to have run up losses of around £12.5 million on its £5 million M&E installation contract. The M&E firm is now in the process of claiming off Laing and is seeking an arbitration hearing.
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Both Laing and Amec refused to comment on the situation.
The project was originally due to finish in September 1995. Last week the MoD admitted that a revised deadline of summer 1998 had been missed and that work on the scheme is still underway. An MoD spokesman said: "The programme has slipped and we are in negotiations with the contractors to resolve the situation."
Sources have indicated that the project will not be completed until Easter 1999. The MoD refused to give a revised completion date or any indication of the cost overrun.
It is not clear what recourse Laing has to claim back its losses. The MoD previously stated that the contract is for a fixed price.
It is understood that contractors have been making strenuous efforts to finish the project, working seven-days-a-week and 24-hours-a-day, incurring higher than anticipated costs.
Laing is part of the Eagle Consortium, led by prime contractor Siemens Plessey Defence Systems, which became BAe Defence Systems in April 1998. The consortium also included Tarmac design consultancy firm TBV Consult (now part of Tarmac Professional Services) - responsible for the outline M&E design, and INRI UK and Digital Equipment at the computer end of the project. The consortium was awarded the design and build contract for the CTF 345 Command Centre project in May 1994.
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