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Grenfell: Rydon struggled to ‘drum up’ interest from cladding contractors

8 September 2020
Zak Maynard

Rydon faced pressure to return a tender for the Grenfell Tower refurbishment because it “struggled” to “drum up any interest” from cladding contractors, the Grenfell Tower Inquiry has heard.

The revelation came to light while the Inquiry heard from witness Zak Maynard, who was Rydon’s managing surveyor on the project in 2014 before later being promoted to commercial manager.

Maynard explained that Rydon regularly used firms like JS Wright and Harley Curtain Wall (who eventually went on to become subcontractor on Grenfell Tower).

But when it came to submitting a tender for Grenfell, a January 2014 email from Rydon estimator Katie Bachellier, on which Maynard was copied in, indicated that JS Wright would “struggle” to return a tender from the project because it was “snowed under” with enquiries from Rydon Construction.

Rydon refurbishment director Steve Blake then wrote to JS Wright and asked them to review the situation because Grenfell was “the best opportunity that Rydon have”.

On 8 January 2014, an internal Rydon email indicated that the firm had requested an extension of time on its tender from Kensington and Chelsea Tenant Management Organisation’s (KCTMO) agent Artelia. Bachellier warned that the contractor would have a “massive problem” if it were not granted.

She added later in the email: “Perhaps we could also cite the fact that we are struggling to drum up any interest from cladding contractors in relation to this project?”

Maynard said he believed that other cladding firms had been approached in relation to the project but didn’t know who they were.

‘Value engineering’ savings

Leading counsel to the Inquiry Richard Millett QC also probed Maynard on cost savings Rydon made during the project. It emerged in March 2014 that it had made an error in its tender sum amounting to £212,000.

Refurbishment director Steve Blake said in an internal email that the problem was “disappointing but not unexpected” and that “hopefully there will be something to compensate”.

Bachellier replied: “I think we will recover this from Harleys by taking the timber window reveals out of their package but that will mean we have to work a little bit harder of finding some significant VE savings”.

Asked if he understood this to mean that Rydon was contemplating identifying value engineering savings that would compensate for the error, Maynard replied: “Potentially, yeah.”

Meanwhile, it emerged that KCTMO’s budget for the refurbishment works was £8.4m, £800,000 less than the £9.2m winning bid submitted by Rydon, which meant more savings needed to be found.

Despite the size of the sum of money that needed to be saved, an email from Steve Blake to the TMO said he saw “no reason why this [the saving] can’t be achieved”.

Millett then asked Maynard about an email from Mark Harris at Harley Curtain Wall to Rydon detailing proposed cost savings, with large savings by using ACM cladding panels rather than zinc cladding, and even bigger savings using face-fixed ACM panels rather than cassette ACM panels.

It set out a series of options to save money on Harley’s January 2014 bid of £3.7m based on Proteus zinc cassette cladding with birch-faced plywood window reveals. The schedule of savings showed that using uPVC window reveals instead of birch-faced plywood would save around £74,000, while using Reynobond standard silver-colour aluminium cladding cassette in lieu of Proteus zinc cladding cassette would save £419,000 and Reynobond standard silver-colour aluminium cladding face fix in lieu of Proteus zinc cladding cassette would save £576,000.

However, when Katie Bachellier at Rydon sent an email to the TMO detailing value engineering options, the main contractor quoted a saving of £293,000 for the alternative aluminium system cassette and £376,000 for the face-fixed option – some £200,000 less than the saving quoted by Harley.

Millett asked Maynard why he didn’t tell the TMO what the real saving was. Maynard replied: “Because that wasn’t the saving that Rydon wanted to give.”

No formal written agreement

Millett also questioned Maynard about the appointment of Harley Curtain Wall, which he asserted “never entered into a comprehensive formal written agreement” for the Grenfell Tower works.

Maynard explained how Harley had initially signed a letter of intent to complete façade design works to the value of £30,000 in July 2014.  

In August 2014, Harley director Mark Harris asked Maynard when contract documents for its work would be ready and Maynard said they would be sent to him “shortly”.

However, by 16 September 2014, Harris emailed again to say that “in order to maintain programme”, Harley needed to order special dyes and bar length material worth £325,000 and requested either an increase in the value of the letter of intent, or the subcontract in place “as soon as possible”.

Maynard increased the letter of intent to the full value of Harley’s lump sum price of £2.6m.

When Maynard was asked why two weeks had elapsed he had promised that the contract documentation would be sent out “shortly”, and why he didn’t proceed directly to a formal contract rather than increasing the letter of intent, he answered: “Workload”.

Millett drew Maynard’s attention to the letter of intent which requested acknowledgement from Harley and the signing and returning of a duplicate. However, the signature block for Harley was left blank and Millett said that no signed copy could be found. Maynard said he did not recall chasing for a signature.

Millett asked: “Was it common for Rydon to allow nearly £3m worth of work to be undertaken without a formal signed agreement in place?”

Maynard replied: “No. Normally there would be a full order in place.”

Asked if it caused any concern later, Maynard answered: “At the end, when obviously Harleys then went into administration it was a worry that we had realised it could have become an issue.” Harley Curtain Wall entered administration in 2015 and was sold in a pre-pack deal to Harley Facades.

The Grenfell Tower Inquiry continues.

Comments

As we hear more in this enquiry I have to say the events are entirely familiar from experience over the last 15 years+ in construction.
A rushed tender process with limited design information leading to mistakes & omissions. The successful contractor often being the one who’s made the biggest error in their tender. Specifications that aren’t fully understood, often cut & paste from previous projects. Building control competing on the lowest fee basis and therefore doing a minimum amount of work and having limited involvement. Main-contracts & sub-contracts that don’t appropriately assign responsibility & risk. Letters of intent that ever get replaced by a full agreement. A turnover in staff especially at site level. A lack of suitable training on the technical aspects, a rush to promote people due to a skills shortage. No real quality control process to inspect each sub-contractors works during the rush to complete.

It’s an industry that’s been in a race to the bottom for a long while and unfortunately Grenfell shows the worst possible consequences of that.

Dan, 8 September 2020

What a mess

Paul Learmonth, 8 September 2020

It’s a problem that has been around for years. Clients who think that all contractors are out to fleece them, contractors trying to make risk judgements in short time scales, subcontractors at the bottom of this stack, clients who pile all the risk on the contractors in short tender periods, etc. The list is endless. Unfortunately, the industry isn’t producing widgets in factory conditions and keeps forgetting that it’s only as good or as bad as the guy on the end of the shovel, out in all weathers. People need to get out of their cosy offices and see what actually happens on sites

Jim Wren, 8 September 2020

I wish I could say this is unusual in the construction industry, but when good people and good businesses across the whole spectrum, work in an environment that is cut throat, pressurised and geared to VE we are setting ourselves up to fail. That’s before the greedy, lazy and incompetent get involved.

Unless we as an industry find a way to change the hearts and minds of everyone from client to smallest subcontractor/supplier, the risk of failure of this level will always be with us.

Paul, 9 September 2020

Is anything lead council extracted new news to those of us who work in the industry. Absolutely not.

Having spent almost 40 years in construction, the only thing that is consistent is the need to have the lowest price, at every end of the spectrum from client through to sub-subcontractor/ supplier. I agree with what most of Dan (8th September) says. Everyone is under pressure to do the best job in the shortest time and at the lowest cost.

Consultants aren’t paid the fees to do a proper job; designs aren’t critiqued and value engineered as thoroughly as they could be; tender documents are lacking; design is often ‘dumped’ on contractors; contractors aren’t given enough time to price projects properly; subcontractors are pressurised into returning figures within days. Every day up and down the country this goes on.

There are those out there who will no doubt be able to tell me of the odd experiences they have where some (or perhaps all of the above) have not happened on a project but time and time again all that is called for is best job, shortest time and lowest cost. I’m not sure it’ll ever change and as long as the industry carries all of the flaws mentioned above, sadly it never will.

David Storey, 10 September 2020

From an outsiders perspective the undertaking of a significant quantity of work without a formal contract must seem somewhat bizarre. Unfortunately as commented in the other replies in my 40+ years experience in the construction industry a lack of a formal agreement or a hopelessly flawed and ambiguous contract are not uncommon.
All too often Employers and their advisers, along with contractors make very ‘blinked’ decisions based on cost rather than considering the end product and a reasonable timescale in which to design and execute a project. Until this cost orientated mindset is changed the Construction industry is going to suffer such failures and a tarnished reputation.

STEPHEN LOWSLEY, 11 September 2020

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