Crossrail saved £95m after axing Costain/Skanska Bond Street contract

Crossrail has saved nearly £100m by axing the Costain/Skanska joint venture (CSJV) from its Bond Street job, new documents have revealed.

According to a report by the Greater London Authority (GLA), Crossrail decided to remove the CSJV from its role as contractor at Bond Street station in 2020, which ultimately saved the project millions. The decision was taken as the expansion of the tube station suffered substantial delays because of the coronavirus pandemic.

Taking the job in-house was a “success story” and amounts to a cut in expenditure of £95m, the report by the GLA’s Oversight Committee revealed.

The report, published this morning, argues that the option of continuing with the CSJV in tow would have “left an outturn estimated… to be as high as £775m” for Bond Street. Instead, the construction job at Bond Street is expected to cost £680m in total, or £95m less.

“Against these estimates, the £19m cost to terminate the contract would appear to have delivered value for money, and the recovery of the delay [is] a success story.”

Bond Street was already behind schedule when the pandemic struck, meaning that, unlike other stations, it was at the peak of its construction activity. That meant a significant “number of operatives [were] required on site” to complete the job, which was not possible at the time because of Covid-19 safety restrictions.

Crossrail paid the CSJV £19m to terminate the contract.

The GLA report added that the projection will need to be “monitored” over the coming months as work at Bond Street comes to an end.

The CSJV did keep its contract to deliver the Crossrail station at Paddington, which opened with most of the other Elizabeth line stations in May this year.

But Bond Street is behind schedule, with work still under way to complete the station. Bond Street has been a thorn in Crossrail’s plans for a number of years, having at one point been years behind schedule, although Transport for London (TfL) has now “clawed it back” to within months of catching up with the rest of the line.

The Oversight Committee recommended that TfL should “formally review” the procurement process used at Bond Street and the impact of the procurement saga on the railway’s delivery. That should “ensure that lessons are learned for future major projects”, the report added.

Construction News approached TfL, Costain and Skanska for comment.

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