Civic Hall contract was signed weeks before Shaylor collapse
Council bosses signed off on a deal for a construction firm to complete the revamp of the Civic Hall just weeks before it collapsed, it has emerged.
Shaylor Group, which ceased trading last week with the loss of 200 jobs, had been due to carry out the £38 million refurbishment of the iconic building.
The Aldridge-firm appeared to suffer a sudden collapse but several businesses reported having problems with Shaylor months ago. The council must now find another contractor to finish the job, sparking fears of a long delay. The Civic is currently scheduled to re-open in 2021.
Shaylor was given the green light to progress with the second phase of the Civic project on May 14 when a variation order was approved by economy chiefs.
- 200 jobs lost as Black Country building firm goes into administration
- 'We knew they were in trouble': Fears for companies owed thousands by Shaylor
- Shaylor Group suffered sudden collapse despite 'progressive year' for business
Opposition councillors say the city council has "serious questions to answer" over the awarding of the contract. The council said scrapping the contract and re-tendering was "not an option" as it would have "incurred financial penalties".
Chiefs said checks on Shaylor's financial health were carried out in February, which raised no concerns. They said they then sought further assurances before signing off on the contract.
Councillor Wendy Thompson, leader of the Conservatives in Wolverhampton and a member of the council’s scrutiny board, has demanded director of regeneration Richard Lawrence appear before the cross-party panel of councillors over the decision on July 9.
A city council spokesman said: “The Civic Halls remain a key priority for us and we are determined to deliver our ambitious £38 million improvement and renovation plans that will make the halls a world-class entertainment venue.
“A procurement route which secures a new contractor and maintains the existing programme is being reviewed and there is scope within the current programme to accommodate this procurement exercise.
“Re-tendering in May was not an option as the council were in contract with Shaylor to complete the contracted works and to end the contract would have incurred financial penalties.
“Due diligence and assurances were sought from Shaylor Group ahead of them being instructed to start the phase two works as per the original contract. The documents the council requested to see included credit reports, audited accounts and letters of assurance.
“We are very disappointed about the situation with Shaylor Group and we feel for their employees. We will now work as quickly as possible to find a new contractor to continue these crucial works.”
Councillor Thompson said: “The council’s chaotic handling of the Civic Halls refurbishment continues. The tragic collapse of Shaylor Group, and the sad loss of 200 jobs, throws the £38 million project into doubt.
“There are serious questions for Wolverhampton Council to answer, especially around why they signed a contract with Shaylors as recently as May, instead of re-tendering. I want to know if the council could have avoided this disastrous situation, and I look forward to questioning officers about this.”