Bidding on Forth bridge replacement could cost taxpayer millions

MSPs have been asked to back plans to pay millions of pounds to companies who bid to build the new Forth road bridge, as calls were made to delay the final decision on whether or not to replace the bridge.

Under plans proposed by Transport Scotland in September, bidders could be given as much as £10 million to cover their costs. The plan was unveiled in the same week that council leaders in Edinburgh urged the Scottish Government to delay its decision on replacing the bridge until at least 2011.

Ainslie McLaughlin, Transport Scotland's major projects director, told the Scottish Parliament finance committee: “We are looking potentially to reimburse if the project does not go ahead for the costs incurred in tendering for the project.”

Under the reimbursement plans, unsuccessful bidders could be reimbursed by as much as £5 million, whilst a successful bidder would be paid double this amount should the project collapse.

The proposal comes as concerns were raised that not enough is being done to attract bidders. There have been fears that the costs of preparing a bid for the contract to build the £2 billion bridge - one of Scotland's largest ever infrastructure projects - may dissuade some companies from bidding for the contract.

John Howison from Transport Scotland also told the committee: “The information we have leads us to believe that we are not secure in getting a competition, or even necessarily a single bidder, without making this commitment to meet these costs on this contingency basis.”

The move is also seen as necessary by civil servants to protect bidders should the final bill to build a new bridge not pass through parliament. Ms McLaughlin added that “Ministers are seeking approval from parliament for the reimbursement of bidders' costs in the event that the contract for the Forth replacement doesn't go ahead, either because of failure of the bill or a further collective decision of the Scottish Government not to proceed with the contract.”

However, some opposition politicians have claimed that the contingency measures, indicate a lack of confidence from the Scottish Government over the viability of the project.

Liberal Democrat finance spokesman Jeremy Purvis said: “This is an indication of the lack of confidence within the Scottish Government about being able to handle this project and that they believe it might not happen at all.

“If it is meant as an incentive for companies to bid, the behaviour of the Scottish Government does not help to build up confidence in the project.”

The proposal, which would have to be ratified by the parliament, would be the first time that such contingency measures have been introduced since the inception of the Scottish Parliament in 1999.

Meanwhile, Edinburgh City Council have urged the Scottish government to delay making a final decision on the replacement of the bridge until new information on the condition of the existing bridge is available in 2011. Councillor Gordon Mackenzie said: “It is clear that we do not have to award a contract for two years or more.

“We will be urging the Scottish Parliament to explore both the public transport strategy and the maintenance of the existing bridge as the bill progresses. This is a huge decision for our parliament and the process must ensure that MSPs have the information, time and space to do justice to all of the issues.”

However, Cllr Mackenzie's suggestion has been strongly criticised by business leaders in Fife. Alan Russell, Chief Executive of Fife's Chamber of Commerce said: “This is a ridiculous, very short-sighted and insular viewpoint that does not take into account the fact that the new Forth bridge is a vital project for Scotland's infrastructure and a lifeline for businesses and residents north of the Forth.”