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Carillion's stalled Midland Met Hospital to restart this autumn

3 August 2018 | By Neil Gerrard

Construction work on the Midland Metropolitan Hospital in Smethwick, where Carillion was the PFI contractor, will restart this autumn with an invitation to tender due to be issued this week.

Sandwell and West Birmingham Hospitals NHS Trust has also decided to abandon PFI and opted for a public funding model for the remaning work.

Carillion signed a deal in 2015 to build the £350m hospital which was originally due to open in October this year.

Construction problems meant the opening date was pushed back to spring 2019. However, construction stalled when the building was only two-thirds built after Carillion's collapse in January.

The trust decided in May to end the existing private finance contract with Carillion's PFI joint venture - the Hospital Company (Sandwell) - and on 20 July it took back control of the site.

After completing an analysis, the trust then reversed its prior preference for a Private Finance 2 (PF2) deal and instead has opted for a public funding model.

It said: "This preference reflects a view that the market for construction demands a specific solution to a two-thirds built hospital."

2022 completion target

The hospital is now due to open in 2022, with formal procurement starting by October this year.

Trust chairman, Richard Samuda said: “In 2014 and again in 2018 we selected a private finance route for this badly needed facility.  Our decision to ask for public funding reflects a view that the building needs urgent attention and a partnership approach with the construction sector. 

"Everyone involved in this project accepts that after seven months there is a need to choose sooner rather than later the right option. 

"I am delighted that joint work with Government officials has given rise to this recommendation, which the board has accepted. 

"I look forward to dialogue with Ministers over coming days and weeks to conclude an agreement to complete the Midland Metropolitan."

The government will now consider the Trust’s recommendation and make a decision between the options, granting public funding sufficient to manage completion and address the risks of changing contractor. 

An invitation to tender was set to be issued this week for an early and enabling works contract to restart key building work on the building this autumn.

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