Skanska’s unsuccessful bid for the £600m first phase of Kent’s Building Schools for the Future programme cost the company £5m, it has emerged, writes Dan Stewart.
The sum is thought to be by far the highest amount so far spent on a losing BSF bid, with sources suggesting it was owing to the bureaucratic bidding process for the government’s £45bn schools programme.
Independent sources confirmed that Skanska paid £5m in its preparation for the first phase of the £1.8bn Kent contract before losing out to Land Securities Trillium in November last year.
The high costs are understood to be owing to the amount of design work the team had to prepare, described by one source as “ridiculous”. The Skanska team, which included architects from Atkins, Make, Flacq, dRMM and DSDHA, had to prepare seven sample school designs.
Other costs included hiring PR companies and exhibition space to promote the bid to the public. It is understood that, for one submission, the print costs alone ran to £80,000.
A source said: “It was a painful loss, as Skanska really believed it was doing well. It just shows the ridiculous amount of work that goes into these bids for absolutely no return.”
It is understood that, for one submission, the print costs alone ran to £80,000
Partnerships for Schools, the quango assigned to oversee the BSF programme, has made moves to tighten bid times and reduce the quantity of pre-scheme material required. The average bid cost is currently about £1m.
Skanska admitted in April that it had lost about £27m on three PFI jobs. David Fison, its then chief executive, later admitted it did not have an “adequate financial spotlight” on its PFI work.
Skanska declined to comment.
More on BSF at www.building.co.uk/archive