Birmingham stonewalls minister over roads PFI

Birmingham City Council (BCC) is risking government intervention on its £2.2bn highways maintenance PFI after its apparent failure to respond to transport minister Tony McNulty’s request for an ‘urgent’ update on the scheme.

McNulty wrote to BCC chief executive Lin Homer last month, following plans by the council to scale back the PFI (CJ 20 October). He warned that any changes to the scheme’s original plan could see £379m of PFI credits stripped from the scheme.

But a Department for Transport spokesman told CJ that “no response” had been received from BCC and could not rule out further action from the
department.

A BCC spokeswoman confirmed that no response had been sent to the minister but refused to comment further on what impact this would have on the scheme.

The apparent stonewalling is also leading to confusion for bidders who have been asked to talk through their pre-qualification questionnaire and give presentations to the council on their bids as a shortlist is due to be announced next month.

However, BCC’s call for the interviews comes against a backdrop of uncertainty in the council, with the authority’s cabinet yet to make a decision on whether to go with the PFI in its original form, or scale it back, resulting in the loss of PFI credits and annual investments being halved.

BCC’s cabinet was due to make a decision by the end of this month but a council spokeswoman said that there was no mention of the PFI in the cabinet’s agenda for the whole of November.

She added: “The cabinet has been given reports on both options for the PFI. Nothing will be confirmed until the cabinet has met and decided on a way forward. It seems there are no immediate plans to do this.”

One bidder told CJ: “This is quite an unusual position for bidders, what with all the uncertainty. We will have a lot of questions we will want to be asking the council’s procurement team. It would be better for all if we knew in which direction we were rowing.”