Further setback at hospital delayed by Jarvis troubles

Supporting role: Jarvis sold its equity stake in Whittington last January and now provides construction support

Completion of the over-budget Whittington Hospital scheme in north London, one of the few remaining Jarvis PFI projects, has been delayed by up to three months.

The first phase of the scheme will not be completed until March at the earliest.

Work stopped on the site for four months in late 2004/early 2005 because of the problems at Jarvis, but despite this the hospital had been due to be ready at the end of this month, just two weeks behind schedule.

However, to hit an intensified timetable, subcontractors are understood to have wanted at least part-payment upfront. The Secondary Market Infrastructure Fund (SMIF), the group that bought the project’s equity stake from Jarvis last January, was not willing to do this. Jarvis now merely provides construction support to the project.

A source said: “Whittington is behind schedule by at least a month. The subbies wanted a certain percentage upfront for every job. The project has lost about a week for every month since October.”

Further delays seem to be expected, as the Whittington Hospital NHS Trust said that it was preparing for handover in April. There will then be a six-week commissioning programme, which would include moving in equipment and staff, before the first phase is opened to the public.

The Whittington hospital project has lost about a week for every month since October

Whittington hospital source

Despite the problems it seems that the project has not gone further over budget. Originally it was to have cost £30m but this rose to about £45m after the difficulties last year.

Better news has emerged this week over other Jarvis schemes that have been sold on. SMIF has signed a deal with contractor ROK to build a school for Springwood Heath Primary in Allerton, Merseyside.

The £5m project should be ready within 18 months to two years. It was originally scheduled to open in September 2004.

Springwood is part of the £300m Liverpool PFI project, signed by Jarvis October 2001. At the time, it was the biggest ever PFI schools contract and included 15 new builds and three refurbishments.

The previous year Jarvis signed a deal for the neighbouring £213m Wirral PFI schools. The refurbishment part of this contract was one of the major reasons for the financial traumas that Jarvis suffered, with inaccurate estate surveys from both its own staff and the council. The project should have been completed last summer, but several structures were found to be unsafe or impractical and had to be knocked down. This means that the cost has risen from £56m to at least £80m.

A source close to the contract was quoted in Building last October as saying: “If you ever wanted a story of a horror contract, Wirral schools is it.” However, some of the schools are starting to be completed, with several due to open for the summer term.