§ Mr. ElletsonTo ask the Secretary of State for the Environment if he has yet considered the response by Lincolnshire county council to the notices served upon the authority on 11 April 1995 under section 19A of the Local Government, Planning and Land Act 1980; and if he will make a statement. [20732]
§ Sir Paul BeresfordMy right hon. Friend has considered carefully the responses which Lincolnshire county council has made to the two notices served on the authority for financial failure of the direct labour organisation in 1993–94 and for alleged anti-competitive behaviour. In relation to the notice for financial failure, he is satisfied that appropriate steps have been taken, and will not be taking any further action. He has however today given the authority a direction under section 19B of the Local Government, Planning and Land Act 1980 for anti-competitive behaviour.
After careful consideration, the Secretary of State remains of the opinion that the authority acted in an anti-competitive manner in awarding a contract for highways maintenance work worth £20,635,000 to its in-house direct labour organisation when it was not the lowest tenderer. He considers that the authority's concerns about the contractor's ability to do the work and financial status were not backed up by sufficient evidence, and therefore were not reasonable grounds for rejection of the lower bid which offered a saving of £2,240,000.
620WThe direction given to Lincolnshire county council requires the authority to retender the work so that new arrangements are in place by 1 January 1997. The authority will need to obtain the Secretary of State's permission if it is intended to award the work in-house, to consult the Federation of Civil Engineering Contractors and the Association of Consulting Engineers on matters contained in the specifications and the methods of tender evaluation to be used; and to seek the comments of the Association of Consulting Engineers regularly throughout the tendering process.