New controversy linked to Metronet collapse

Transport secretary Ruth Kelly has said Metronet's failure may mean the Government will do less business with its shareholders in future, reported Construction News.

Speaking at a parliamentary transport committee meeting, she said the reputations of consortium members including Balfour Beatty and Atkins were now damaged, making it more difficult for them to win govt contracts. "I think this is a terrible failure," CN quoted Kelly as saying. "When we award contracts, we look at the competence and delivery record of individual companies, and these issues will be taken into account."

Between them the firms have already written off £300m. Graham Pimlott, who was Metronet's chairman from January to August this year, blamed the problems on Metronet's relationship with its project management firm Trans4m, which gave it little leeway when paying bills: "we couldn't withold for performance failure," he told CN.

Meanwhile, Building magazine reported on the Government's decision to reject calls for an inquiry into the collapse of Metronet after an MP made allegations of corruption.

Graham Stringer MP insisted last week that the relationship between Metronet and Trans4m, which carried out station renovations, "looked like real corruption". But when presenting evidence to the committee, Kelly insisted the collapse of Metronet was instead down to its poor corporate structure, not corruption.