Extra time and penalties

They are glued to the unravelling drama of Multiplex’s battle to complete the troubled stadium. The men on site, however, feel somewhat differently. “The workers are putting the hours in, but half the time they’re just wandering around because they’re so fed up,” says one site source. “I’ve been working in this industry for 25 years and I’ve never seen so many people who just think f**k it, who gives a sh*t.”

Wembley stadium

It is not the attitude expected from people who have the privilege to be working on one of Britain’s most prestigious projects. Particularly given the lucrative bonuses on offer as main contractor Multiplex battles against time, cost, and widespread criticism to meet its 31 March handover deadline. But with Football Association officials meeting next month to deliver a verdict on the venue for the cup final, workers on the stadium are becoming disillusioned with what many consider an impossible task.

However, worker dissatisfaction is a drop in the ocean compared with the growing list of problems for Multiplex. There are at least five major obstacles to the stadium being ready for the cup final (see below and overleaf), ranging from difficulties with the roof to political rows with the unions. And pressures keep mounting – in the past week it has emerged the contractor has begun a fight for concessions on penalty clauses after a land dispute caused four months of delays to infrastructure surrounding the stadium. The contractor has also been forced to offer financial assistance to at least one of its specialist subcontractors – the name of which, Phoenix, is revealed here for the first time – to prevent “unworkable losses” for the company; a measure it may have to extend to other firms.

It is all a far cry from last March when Multiplex project director Ashley Muldoon pledged to Building that Wembley would be ready a month early: “This project will be on time. We hope to be out by Christmas.”

The predicted £70m losses Multiplex has admitted it faces on Wembley could escalate even further – up to £200m, according to some reports – should the stadium not be finished on time, thanks in part to hefty penalty clauses of £120,000 a day. The risk that Multiplex would face the fines looked to have increased last week, after it emerged that construction of a walkway and car park outside the stadium would be delayed for four and two months respectively.

Multiplex is understood to be furious about the problem, which it claims is the result of a land dispute between client Wembley National Stadium Ltd and landowner Quintain. Quintain was unsatisfied with safety assurances from WNSL. The company demanded additional safety tests before it would allow construction to begin on the walkway, known as the Olympic Pedway. A senior source at Multiplex said: “It’s nothing to do with us, but the problems with the walkway and the car park have hindered progress. There is discussion about penalty clauses now. We’ll have to wait and see, but obviously this project is having its financial consequences for us.”

Multiplex will not lie down without a fight over the issue, though. The contractor has begun talks with Football Association subsidiary Wembley National Stadium Ltd about whether the FA would cut down the penalties if WNSL is found to have contributed to the late delivery. Talks are believed to include a series of potential concessions aimed at speeding up the final phases of construction, as well as reducing the eventual financial impact on Multiplex.

A senior FA source said: “I can’t go into too much detail for confidentiality reasons but obviously there are penalty clauses for Multiplex should they not meet the first handover deadlines at the end of January. But we are negotiating with them now about seeing how we can help them out a bit. There are certain contractual options we have that could enable them to speed up the final stages of the stadium.”

But Multiplex should not be too hopeful of help from WNSL, either financial or in speeding up construction. A WNSL source denies that the land dispute has a significant impact on Multiplex’s construction programme. The source said: “We have resolved the land dispute. The 13-week programme for the walkway will take Multiplex to only two days past the 31 March, so it will only require a slight acceleration from them.”

WNSL is already working to its own pre-planned programme of recruitment to staff the stadium, and does not have plans to speed this up in light of Multiplex’s problems. The source said: “Our plan was always to ramp up our recruitment drive around January, as it’s easier to get people excited in the opportunity of working here when the stadium nears completion. We are working as we’d always hoped to do in terms of advertising and training, but there isn’t really anything else we can do.”

I’ve been working on major projects for years and I’ve never seen a deadline like this. It won’t be done

Site source at Wembley

Any financial help WNSL awards Multiplex will prove a welcome respite for the contractor as it battles to deal with a raft of knock-on financial problems besetting subcontractors on the project. It has been reported that Multiplex has been helping to pay the spiralling costs of one of its subcontractors to ensure that it has the financial clout to meet its demands. This subbie is electrical contractor Phoenix, which found itself struggling to cope with the increased costs.

Brian Ingram, director for Wembley at Phoenix Electrical, said: “Multiplex have understood the situation and been reasonable in their dealings with us. I wouldn’t say they are propping us up, but they realised there are cost implications on the contract. We are being treated fairly.”

A senior source at Phoenix said: “For us to finish this project is costing us so much. We are not in a position to take a big hit. Multiplex recognised we are spending a lot of money out there and realised we couldn’t keep paying the costs. We’ve agreed various measures.”

Revelation of the deal with Phoenix comes fast on the heels of the loss of plumbing contractor SGD, which went into administration in November. SGD blamed cost overruns on the project and a lack of compensation from Multiplex for its demise, and Multiplex can ill afford to lose another contractor at the project’s critical final stage.

Even with Multiplex’s assistance, however, Phoenix’s ability to complete the project’s vast electrical component is far from assured. About 20% of the work has yet to be completed, and the pressure of external factors, such as the London Underground employment dispute, could still undermine the contractor’s efforts. “There are Tube strikes planned for virtually every week,” says the source, who fears arriving on site one Monday to find he only has 250 out of 600 men.

“But at the end of the day, if we can get the stadium in a condition to be open for four hours on the match day, we’ll then have another three months to finish things off.”

Among those items to “finish off” after the cup final are likely to be some of the most eye-catching elements of the project – the retractable roof, for example, has only had two of its 20 panels lifted in place so far and the fit-out programme is two months behind schedule.

Problems with the unions have thrown even the core elements of the stadium into doubt. Multiplex is continually negotiating incentive payments to speed up work. However, relations with the unions recently broke down when 22 steelworkers working for Hollandia were laid off, shortly after Multiplex had agreed Christmas bonuses. This resulted in a strike, putting the steel roof a further three weeks behind schedule.

“Somewhere within the Multiplex hierarchy, the left hand didn’t know what the right hand was doing,” says one exasperated union source. “We didn’t know what the hell was going on.”

With all these obstacles to overcome, it’s becoming increasingly difficult to see Wembley kicking off this May.

I’ve been down to the betting shop and put my money on the final being held at Wembley. One way or another, the game will be played here

Brian Ingram, Phoenix Electrical

1. The roof

The first problem with the work at Wembley to emerge was with the sliding roof, and the structure remains Multiplex’s biggest headache. Original steel contractor Cleveland Bridge left the project in August 2004 after a bitter dispute with Multiplex over design difficulties on the iconic arch that will support the roof: a row that will see Multiplex face a £30m High Court claim from the steel contractor this year. Dutch contractor Hollandia was Multiplex’s much-heralded replacement, but only after the project had fallen massively behind schedule. Multiplex then dug deep and offered workers bonuses of up to £7000 each to hit a series of steelwork milestones to have the roof finished by October – which the contractor revised within weeks as they were deemed unachievable. Only two of the 20 roof panels have been lifted into place so far. Site sources now claim there is a “real chance” that the stadium could open without the retractable roof being operational. Not good for spectators hoping to be sheltered from the rain should the final go ahead, or for Multiplex’s mounting debts: Hollandia still hasn’t been held to a fixed-price contract, meaning the Australian contractor is footing the bill for rising costs and overruns.

2. Interiors and commissioning

If the cup final does go ahead at Wembley, there’s every chance the prawn sandwich brigade won’t be watching the game in full corporate comfort. Fit-out contractors lined up to work on hospitality suites, executive boxes and the press room have been unable to gain full access to these areas because of the overruns on the steelwork. The fit-out programme is now believed to be two months behind schedule, and sources at Multiplex have admitted at least the warm-up games before the cup final will not be played with full hospitality.

The situation hasn’t been helped by the demise of plumbing contractor SGD, which was working on 2600 toilets before it went down the pan itself in November. Multiplex has had to draft in MJN Colston, already pushed to finish M&E work on the project, to complete the work. WNSL has declined to expand its own recruitment drive to staff the stadium by getting additional people in to help out Multiplex.

3. The Football Association

The FA seems to be wavering on whether the FA Cup Final will be played at Wembley in May. The body has booked the Millennium stadium in Cardiff as a reserve option, although officials say Multiplex has assured them it is on schedule to hand the stadium over on 31 March. The 31 March date is critical, as the FA cannot legally hold the cup final at Wembley unless they hold a series of “ramp up” events beforehand, to ensure the stadium is in a safe working condition. These events are to be held in April, and for them to go ahead the FA must be convinced that any elements that cannot be completed by that date are not essential to the stadium’s use. FA chiefs are due to meet on site early next month to deliver their verdict on the project.

4. The external facilities

The latest problems to have hit the site are the delays on construction of the pedestrian walkway and car park outside the stadium. A senior Multiplex source said this week: “Come the cup final there will definitely be a stadium ready, but whether it will be empty or not depends on whether the infrastructure outside will be safe to use.” The delays, currently two months on the car park and four on the walkway, have been caused by a dispute between landowner Quintain and client Wembley National Stadium Ltd.

5. Unions and the supply chain

SGD Engineering, a plumbing contractor that went into administration in November, blamed many of its problems on Multiplex for requiring it to work beyond its resources. Many other subcontractors on the project are also feeling the pinch, particularly M&E contractor Phoenix Electrical, which now has almost 600 workers on seven-day weeks. Multiplex recognises it cannot afford to lose a key specialist to insolvency at this stage of the project, and it emerged this week that the contractor is beginning to offer assistance to enable companies to lessen the blow. Multiplex is helping Phoenix cope with cost and time overruns on the project; it may have to do the same for other contractors before the stadium is complete. With frequent negotiations on incentive payments to speed up work on the project, Multiplex needs to bend over backwards to keep on the right side of construction unions. Unfortunate, then, that after concluding lengthy talks over Christmas bonuses for steelworkers working for Hollandia, 22 workers were laid off. The result: workers refused to enter the site over Christmas, putting the steel roof a further three weeks behind schedule. The confusion has led to a further round of time-consuming talk to appease union reps.