Council had carried out thorough review of Armoury Group bid.
Bosses behind the regeneration of Basing View business park appointed a company to demolish two high-rise buildings despite concerns about its bid, a report has said. Armoury Group, which won the contract to demolish City Wall House and Loddon House, went into administration in December last year – just weeks after starting work on demolishing the two buildings.
The company had won the lucrative contract after coming up with a bid that was more than £1.5million lower than its nearest rival.
A new report has revealed officers at Basingstoke and Deane Borough Council had concerns about the bid, but still decided to press ahead with awarding the contract. The report, to the council’s audit, governance and accounts committee, said Armoury bid £749,600 to raze the two buildings. The next lowest bid, from Erith Contractors, was more than £2.4m.
The report’s authors added: “The evaluation team were conscious the recommended bid from Armoury was significantly below the anticipated budget. Given the obvious concerns, the team undertook a thorough review of Armoury’s tender.”
The report noted that following the due diligence review, it was not felt there were sufficient grounds for disqualifying the bid.
Erith Contractors is now carrying out the remainder of the work with a new contract price of £1.48m. The report said the council’s tender process “proved itself to be sound” but that lessons can be learned from the process. In response, officers have looked at the council’s procurement procedures and resolved that it will be amended to provide a clearer financial assessment of prospective bidders at the pre-application stage.
