Crossrail procurement delayed by UK’s review of rules

Following the controversy over the Thameslink PFI bid, after which transport company Bombardier announced 1,400 UK job losses, the Crossrail rolling stock and depot procurement has been delayed by a year so that a UK government review of EU procurement rules can be taken into account.

Crossrail Limited, which is overseeing the Crossrail project to run over 100 kilometres of rail lines from west to east London, has announced that the procurement of rolling stock and depots for the project has been delayed by a year.

The issuance of tender documents had initially been expected later this year with the award of the contract in late 2013. Crossrail said it now expects tender documents to be issued in 2012 with the contract to be awarded in 2014.

In a statement, Crossrail claimed that introducing rolling stock to the rail network over a shorter period would “realise significant savings for the public purse, running into the tens of millions”. But it also said that the delay would allow the UK government’s review of European Union (EU) procurement rules to be taken into account.

Such a review was called for by opposition politicians and unions – but also reportedly by Coalition government ministers Phillip Hammond (transport minister) and Vince Cable (business secretary) – after Canadian transport company Bombardier announced 1,400 UK job losses when it lost the Thameslink Private Finance Initiative (PFI) rolling stock procurement bid in July this year. The bid was won by a consortium led by Germany’s Siemens.

While resisting calls to overturn the Thameslink decision, Hammond told the BBC: “The way some of our continental partners approach these things is to look more strategically at the domestic supply chain. It is clear that it is possible to structure the contracts such that, even within the constraints of the European procurement directive…there are much greater chances of the domestic supply chain succeeding. I think we need to look at how we manage these things in the UK in the future.”

A furore had blown up amid claims, from unions in particular, that domestic rail manufacturers in countries such as France and Germany rarely lose out in procurement processes in their home markets – despite a stipulation within the EU procurement rules that the country of origin of a bidder should not be taken into account.

The outcome of the Crossrail procurement will be particularly intriguing since the UK arm of Bombardier is on the shortlist of organisations invited to tender, along with Siemens. Construcciones y Auxiliar de Ferrocarriles and Hitachi Rail Europe are also on the list, while Alstom Transport was originally on the list (drawn up on March 30) but has since withdrawn.