PETER MADDISON, Kensington and Chelsea Tenant Management Organisation’s (KCTMO’s) director of assets and regeneration for Grenfell, denied a meeting with Rydon pre appointment was ‘improper’.
Building reported on Mr Maddison’s continued evidence at the Grenfell inquiry, in which he admitted ‘instigating’ talks with Rydon before it was confirmed to be the main contractor on the refurbishment, but rejected the suggestion that his actions were ‘improper’, stating that the contact was ‘vital’ in order to move the project ‘forward’.
He admitted he had known Rydon’s head of regeneration Stephen Blake and its managing director Jeff Henton before he joined KCTMO in 2013, and the inquiry had already been told Mr Blake was tipped off by someone at ‘K+C’ that Rydon was in ‘pole position’ to win the contract via the Official Journal of the European Union (OJEU) procurement process in March 2014. This was in an email Mr Blake sent to a colleague the day before the interview process for the contractor.
This was also sent ‘almost two weeks’ before Rydon was officially told it was the preferred contractor, and Mr Maddison denied he was responsible for the ‘tip-off’ at a housing conference in Brighton ‘that both he and Blake attended’. He also said he ‘did not know’ who might have been responsible, but admitted calling Mr Henton a few days after the event to tell him Rydon was ‘in first position’ and to ‘agree a process’ to clarify if KCTMO could award the contract.
The process aimed to secure the agreement that Rydon find £800,000 in savings and bring its winning bid of £9.2m ‘in line’ with KCTMO’s budget, with the inquiry also hearing that ‘later on the day’ that Mr Maddison told Mr Henton this, ‘arrangements were made for a meal to bring together senior [KCTMO] and Rydon directors’, with inquiry counsel Richard Millett asking if there was an ‘element of celebration’ about this event – Mr Maddison said Mr Henton ‘may have seen it like that’.
A day later, Mr Henton emailed Rydon colleagues to say the bid was in first place, adding that ’subject to a small amount of value engineering, Peter should be in a position to recommend our appointment on this scheme to his board early next week’. Asked if he had told Mr Henton Rydon was going to win ‘subject to a small amount of value engineering’, Mr Maddison stated he would not have said this, but said ‘subject to the completion of the standstill period and board approval’.
He also rejected Mr Millett’s suggestion it had been ‘improper’ in terms of the rules to informally let Rydon know it was first ‘while the OJEU process was still live’, stating: ‘I wouldn’t call it improper. I would say that it did factor in some potential risks of challenge within the EU procurement rules. We took legal advice on that. The advice was not that it was illegal or improper.’
He understood that the risks were ‘commercial risks’, though the inquiry had heard last week that KCTMO’s lawyers Trowers and Hamlins advised it could not enter negotiations with any bidder ‘prior to the award of a contract’, so the only ‘EU compliant’ options were to award the contract based on original criteria before discussing value engineering, or not award it and start a new process.
Mr Maddison said KCTMO was ‘keen to avoid re-running the procurement’, and that it believed its only option was to work with ‘existing contractor’ Rydon, adding that ‘we were in a situation where we’d only had five tenderers who had gone down to three. We were clear there wasn’t a very strong market there’. Getting ‘clarification’ on the approach to cost reduction was ‘critical’, he said, for getting KCTMO’s board to approve Rydon’s selection, because its bid was above budget.
Further contact between Mr Maddison and Mr Blake in March 2014 was also discussed at the inquiry, including ‘the topic of potential value engineering savings’, with Mr Maddison accepting he had instructed KCTMO head of capital investment David Gibson to email Mr Blake and set out ‘detailed areas’ of the project that ‘could contribute’ to the savings required, alongside confirming details of the ‘secret’ meeting between KCTMO and Rydon described by Mr Gibson as ‘offline’.
On his relationship with Mr Blake, Mr Maddison said he had met him while working at Hyde Housing Association, who Rydon had done ‘a lot of work for’, but had never personally appointed them to any job they bid for as they ‘tended to be more expensive than most’. He said ‘I wouldn’t really say I knew Mr Blake’, adding that ‘I knew him in the same way that I knew his equivalents in most of the main contractors who would bid for this sort of work’.
He had also worked at Homes for Haringey between Hyde and KCTMO, where Mr Henton was a non executive director. The inquiry also heard that in early 2013, when Leadbitter was ‘the expected contractor’ for Grenfell, Mr Maddison suggested to consultants Artelia that Rydon could offer ‘cost advice’ on the project, as he was aware it had overclad blocks on the Chalcots Estate in Camden, which he had visited during the project.
Mr Millett asked him about an email conversation in April 2013 between Mr Blake and Mr Henton which had the subject ‘Grenfell Tower Regeneration Project’, and which saw Mr Blake tell Mr Henton that ‘this [is] the Peter Maddison scheme which is right up our street’. He also suggested KCTMO was asking for a framework Rydon was on ‘to avoid OJEU’ – Mr Millett asked why Mr Blake referred to Grenfell as the ‘Peter Maddison scheme’.
Mr Maddison said he would tell his ‘network’ when he moved jobs to ‘talk opportunities’, adding: ‘What we were doing at KCTMO was trying to gear up to deliver much bigger programmes, and we needed larger-scale contractors to come in and help deliver. There were conversations that I’ve had with a whole range of contractors and, in reality, that field is relatively small. There aren’t hundreds of contractors who do refurbishment of homes in occupation at large scale.’
He was then asked about a July 2013 entry in one of his diaries that read ‘OJEU – let Jeff know’, which he said was a reminder to give Mr Henton a ‘heads up’ that the OJEU notice for Grenfell was being issued. Mr Millett asked if he had contacted any other potential contractors like this, and Mr Maddison said ‘I suspect we would have contacted Keepmoat’, with the notebooks not suggesting – Mr Millett said – he had ‘intended to make contact with any other contractors’.
In response, Mr Maddison said he had ‘concerns’ about Leadbitter’s ‘suitability’ from the project ‘from an early stage’, specifically costings, and he believed it ‘lacked experience’ in work Grenfell would involve, as well as working with residents remaining in their homes during works. He also said he believed there was a ‘lack of urgency and a lack of commitment to the project’ from the contractor.
In his view, ‘my biggest concern was their lack of experience of refurbishing this sort of project. My experience of them was as a new-build developer rather than a contractor experienced in refurbishing homes in occupation’. He also had concerns over it being taken over by Bouygues as he believed that company ‘lacked experience’ working with residents in occupation.
Asked why he had fears about due diligence with appointing Leadbitter but not Studio E, which ‘had never worked’ on an overcladding project for a high rise residential building, he said: I’d had no concerns personally that I’d recognised in relation to Studio E, and neither did any of the other members of the professional team. I didn’t know their lack of experience on high- rise at that time.’
He had expected that by putting the project out to tender as design and build, the winning contractor would have been ‘responsible for examining’ architect design decisions, and believed Leadbitter’s competence ‘could have been subjected to due diligence if it had chosen to bid’, but it did not.