Chris Grayling came under fire from all sides at a bad-tempered Transport Questions this morning. He ignored calls from the Shadow Transport Secretary Andy MacDonald and Tory MP Cheryl Gillan for an inquiry into the HS2 – CH2m shambles. MacDonald not unreasonably said the story “stinks to high heaven”, Grayling laughably replied that the cancelling of a £170 million contract was not a “massive” issue. Wonder what CH2M think about that. Notable how Grayling carefully distanced himself from the beleaguered “independent” HS2 board…

Victory! HS2 has scrapped the scandal-hit £170 million contract awarded to CH2M following our repeated revelations of conflicts of interest. The announcement that CH2M will be withdrawing its bid comes on Article 50 day as the government tries to bury the humiliating climb down. The company says it is pulling out due to “protracted delays and ongoing speculation”.

“CH2M today provided formal notice to Hs2 Ltd that we are withdrawing our interest in the Hs2 Phase 2b contract. CH2M has demonstrated all appropriate measures taken throughout to ensure the integrity of the procurement process. Notwithstanding these efforts, we have taken the decision to alleviate any further delays to this critical national infrastructure project which could ultimately lead to increasing costs to UK taxpayers, as well as to our firm.”

The final straw was Guido’s story last week reporting that HS2’s former chief of staff Chris Reynolds had worked on CH2M’s bid as its director for the development partner contract. A stunningly blatant, undeclared conflict of interest, and a win for Guido’s public interest campaigning blogging…

How Guido forced the climb down:

• February 9: HS2’s Revolving Door With US Contractor
• February 22: 200 Staff Went Through HS2 Revolving Door
• February 23: Taxpayers Billed £60,000 Per Month For Conflicted HS2 Boss
• March 6: Yet Another HS2 Delay: Number 10 Watching Closely
• March 20: HS2 Delays Contract AGAIN Over Conflicts of Interest
• March 22: HS2 Crisis Meeting Today
• March 29: HS2 Don’t Deny They’re About to Can CH2M

UPDATE: Statement from the rival bidder Mace:

“We have just been informed of CH2M’s decision through Guido Fawkes. The investigation regarding our concerns about conflict of interest has clearly raised some serious questions about the process. A meeting is scheduled between Mace and HS2 on Friday, and we look forward to hearing what HS2 propose to do next and their response to our questions. When millions of pounds of British taxpayers’ money is being spent, the public rightly expect decisions to be made following a thorough process and on a level playing field.”

UPDATE II: Taxpayers’ Alliance comment:

“The revolving door between HS2 Ltd and CH2M never passed the smell test and serious questions were rightly raised around HS2 continuously appointing staff from one of their contractors. There was never a convincing case for HS2 and its multi-billion pound budget would be far better spent on local infrastructure projects that would cost much less and deliver much better value for money. Hopefully today’s decision is the first step towards this expensive vanity project being binned altogether.”

UPDATE III: Tory MP Cheryl Gillian says the fiasco is “an extraordinary state of affairs”:

UPDATE IV: CH2M statement:

“As is a matter of public record, HS2 Ltd sought clarification from CH2M on a number of areas. CH2M responded to each of these queries in a timely manner. Furthermore,  CH2M is clear that it went above and beyond the conflict of interest protocols, as set out by HS2 Ltd. HS2 Ltd were aware of the involvement of Mr Reynolds throughout the procurement process, as documented in CH2M’s bid, which expressly identified Christopher Reynolds and included quotes from him. Mr Reynolds’ appointment to CH2M took place 5 months after him leaving HS2 Ltd. Mr Reynolds is a valued member of CH2M staff and brings with him a wealth of technical experience.”

HS2 is refusing to deny that they are about to scrap their scandal-hit £170 million contract with CH2M following Guido’s revelations of conflicts of interest. On a long day of spin yesterday, DfT and HS2 officials declined to answer Guido’s questions on whether the contract with CH2M would still go ahead. A spokesman would only say:

“The matter remains under discussion. We will let people know when those discussions conclude. We’re not providing any other comment at this stage.”

This morning’s FT quotes a source close to CH2M as saying: “CH2M has been told that they either stand down or they will be kicked off. It is going to happen this week”. Good time to bury bad news…

The half a billion pound HS2 conflict of interest row is generating such concern that Guido hears a crisis board meeting has been called today. As the spotlight shines on the board to protect the taxpayer from a legal challenge over the £170 million contract awarded to construction firm CH2M, Guido can report on yet another conflict of interest…

Not only is HS2 Ltd’s current CEO Mark Thurston a former CH2M employee. Not only is HS2 Ltd’s previous CEO Roy Hill a former CH2M employee. Now HS2 Ltd’s former chief of staff Chris Reynolds has been hired by… CH2M! Specifically as programme director for the development partner contract. Industry journal Construction News says this raises further questions about HS2 handing a massive taxpayer-funded contract to a firm that then hired its chief of staff. The revolving door spins ever faster, something for the HS2 board to discuss at their meeting today…

HS2 has delayed the controversial award of a £170 million contract for a second time as it investigates conflict of interest concerns. Last week we reported how the taxpayer-funded contract to construction firm CH2M had not been signed off because a rival bidder, Mace, had threatened legal action. They claim the deal was conflicted because the current and former bosses of HS2, Mark Thurston and Roy Hill, both previously worked for CH2M. The revolving door makes George Osborne’s multi-jobbing seem above board.

Mace has now appointed a QC to advise them, and was due to have a second meeting with HS2 last week to discuss concerns. Yet HS2 delayed that meeting after failing to conclude its internal investigation into the conflicts of interest in time. Mace say:

“It is right and proper that HS2 are taking our concerns over conflict of interest and tender process seriously. However, it is taking a significant amount of time for HS2 to conclude their investigations.”

This is costing taxpayers thousands and thousands of pounds, all the while delaying HS2 again and again…

Downing Street is monitoring the situation closely after HS2 delayed the awarding of a £170 million contract amid conflict of interest allegations. Following Guido’s stories on the revolving door between HS2 and American engineering firm CH2M, also covered extensively in the FT, Times and City AM, defeated bidder Mace threatened HS2 with legal action. They are understandably suspicious that the contract was handed to CH2M, the boss of HS2’s previous employer.

In response, HS2 has now delayed the signing of the contract with CH2M while it meets with Mace to discuss the allegations of a conflict of interest. Remember dozens of CH2M staff on secondment at HS2 continue to take home huge salaries while not a rail is being laid. Guido hears Number 10 is watching developments with increasing interest. Yet another HS2 delay…