16 March 2007
The Private Finance Initiative project to rebuild the National Physical Laboratory collapsed because neither government nor the contractor appreciated the scale of the challenges involved, MPs said this week.
The Public Accounts Committee laid the blame for the scheme's failure on a flawed procurement process and the naivety of both the Department of Trade and Industry and the contractor Laser.
The committee's March 13 report noted the DTI had had doubts about the designs for the new complex, but placed the contract anyway. It was terminated in 2004, six years after it was commissioned, when Laser recognised that it did not have the financial capacity to finish the project.
PAC chair Edward Leigh said: 'This was the first time that the plug had to be pulled on a major PFI contract because the contractor was incapable of coming up with the goods. Of the 400 laboratories to be built, many were late by five years and some have still not been completed.'
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