UK – Ruling on submarine facility costs

Faslane Naval Base (Scotland)

The cost of creating a nuclear submarine support facility at a Royal Navy base could be £145 million more than the initial estimate, a High Court judge has said.

Experts originally quoted an £89 million target figure for the facility at the Faslane base in Argyll and Bute, said Mr Justice Coulson.

The current “agreed maximum price” was around £140 million, said the judge. But engineers thought that the “ultimate cost” could be as much as £235.7 million.

Details emerged after lawyers debated terms of a contract, drawn up when the Ministry of Defence (MoD) engaged engineering firm Amec in 2000, at the High Court in London.

Mr Justice Coulson said the MoD and Amec could not agree on who should foot the “extensive overrun” bill.

The judge said a difficulty had arisen out of “badly worded” contract provisions.

He decided that the MoD should pay a “reasonable” amount but not costs incurred as a consequence of Amec’s contract breaches.

His ruling did not specify exactly how much of the overspend would be footed by the MoD and how much by Amec.

He had heard legal argument at a hearing in December and published a written judgment.

Source – Paisley Daily Express

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