Jarvis, Bovis and Bradman teams may seek compensation after being asked for "single-decant" schemes.
Home Office officials have stunned teams bidding for the department's £60m headquarters by asking them to rebid almost three years after the scheme was first advertised.

Jarvis, Bovis and a consortium led by developer Godfrey Bradman declined to comment, but they are understood to be outraged after the decision to rebid on the private finance initiative project was announced last Friday.

Building revealed that the project, to provide headquarters accommodation for the Home Office, was in trouble earlier this month, but matters have taken a turn for the worse.

Officials have asked the three teams to bid again under different terms from those advertised in August 1996.

There was immediate speculation that each of the bidders, having already spent millions on the project, will press for compensation. It is understood that they have all asked for "clarification" on this issue.

The rebid has come about because ministers and officials objected to the "double decant" into and then out of temporary offices that Jarvis and Bovis had suggested in their schemes.

The third team, Bradman's, suggested a single decant into a new building.

Jarvis and Bovis believe the Home Office's original advertisement asked for a double decant, as it requested a PFI scheme repayable over 15 years, which they interpreted as a refurbishment.

The double decant would have seen 1500 officials leave the Home Office's Queen Anne's Gate headquarters while it was refurbished and then move back some years later.

But once best and final offers had been submitted on this basis, officials decided they wanted only a single decant. No proposals for a double decant will be accepted in the rebid.

Bidders have not been given any information about the site for the new building, but the site of the DOE's former office at Victoria's Marsham Street is hot favourite. The Bradman team suggested this site in its original bid.

Jarvis and Bovis are annoyed because they believed they were asked to bid on the basis of a double decant. The Bradman team is also unhappy, as it believes it submitted an innovative bid in the spirit of the PFI that less imaginative rivals will now try to match.

The bidders, which were called to separate meetings to hear of the rebid, were told to expect new bidding documents with decanting restrictions soon, but no new timetable has been set for the project.

One bidder said: "I would hope they will at least get new bid documents out before the millennium. We are all totally pissed off." Another said: "How could they do this after all this time? Why didn't they make any decisions about the decanting issue in the first place? It's a very funny way of dealing with matters." A Home Office spokesman said: "No final decisions on the project have been made.

"Negotiations are continuing with the three bidders and the project is very much alive. We hope to move to a preferred bidder later this year." The Home Office scheme is the second major PFI accommodation project to run into serious difficulty. The Treasury's £200m headquarters ran into trouble soon after Bovis and Stanhope were named preferred bidder. Former paymaster-general Geoffrey Robinson cancelled the project after a year-long struggle to close the deal.

Last autumn, Bovis was invited back to produce a scaled-down, £100m version of the scheme.