COMMONS

NAO should review the Thameslink rolling stock procurement

16 December 2011

The procurement process which led to the selection of Siemens as the preferred bidder for new Thameslink rolling stock should be independently reviewed by the National Audit Office, says the Transport Committee.

Launching the report of a recent inquiry into this procurement, Louise Ellman, Chair of the Transport Committee said,

"We could not evaluate whether the decision to choose Siemens was arrived at correctly because all of the bids were and remain confidential.  We believe that in the public interest an independent review must evaluate whether this massive contract was awarded correctly on the basis of the criteria in the original invitation to tender."

The Transport Committee has therefore written to the Comptroller and Auditor General to request he undertake this work and report to Parliament before summer 2012.

There is now widespread agreement that the criteria used in the procurement were too narrowly drawn in excluding socio-economic factors.

"Both the current and previous Secretary of State have made plain they have no intention of starting the process again because of the delays they consider this will lead to,"

said Louise Ellman.

Conclusions

 

MPs also concluded:

  • Siemens' A+ credit rating almost certainly made a significant contribution to its success in winning the Thameslink procurement and that the bundling of train manufacture and financing together in large procurement exercises will skew the market towards larger multinational firms, possibly at the expense of excellence in train design and domestic manufacturing.
  • The government should clarify whether the medium term procurement plans mentioned in the Chancellor’s Autumn Statement include a plan for rolling stock. 
  • The Government must do more to ensure that UK-based companies in, or supplying, the train building sector enjoy a steadier flow of business opportunities including new projects before the next major train procurement. 
"We support the Government's intention to place a sharper focus on the UK's strategic interest in major public procurements and must hope that this new approach to procurement does not come too late for the Bombardier plant in Derby. It will be crucial for the Government to work closely UK train makers so that together they can develop a financial partnership that will offer good value to the taxpayer whilst promoting long-term best value,"

added Louise Ellman.

Further Information

Image: iStockphoto

 

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