Crossrail will use project bank accounts on all its major contracts in a bid to keep payment times down

Andy Mitchell, programme director of the £15.9bn cross London rail link, said the move would help cash flow throughout the supply chain on the project. He said: “We want a neutral cash flow so that nobody in the supply chain is waiting to be paid.”

It is understood that Crossrail is using the Office of Government Commerce’s (OGC) project bank account (PBA) model, in which the client pays money into a single central account and directly to any suppliers once work is signed off, rather than through the main contractor.

Rudi Klein, chief executive of the Specialist Engineering Contractors Group, welcomed the move and said PBAs on average saved clients 2.5% of the project cost. He said: “The system reduces the client’s exposure to insolvency of someone in the supply chain, thus reducing the overall risk of disruption.”

The use of PBAs is growing, with backing from the OGC, and Defence Estates pledging to use them on all future contracts.

However, one major contractor bidding on Crossrail said he preferred the traditional model. He said: “We don’t hold the money, so it gives us slightly less control.”

Elsewhere, it has emerged that the five teams shortlisted for the C300 Tunnels West and C305 Tunnels East packages, valued at about £1bn each with tender documents expected today, will also be asked to submit bids for the Liverpool Street/Whitechapel and Tottenham Court Road/Bond Street sprayed concrete lining station tunnels.

The teams include Balfour Beatty, Morgan Est and Vinci; Bam Nuttall, Ferrovial Agroman and Kier; Costain, Skanska and Bilfinger Berger Civil; Dragados and John Sisk & Son (Holdings); and Laing O’Rourke and Bouygues.

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