THE INQUIRY into the fire heard that Kensington and Chelsea Tenant Management Organisation (KCTMO) held a ‘secret’ meeting with contractor Rydon to cut the costs of the project.

The inquiry resumed on 7 September, and its first day saw Rydon’s commercial manager state that the company ‘struggled’ to find cladding specialists for the refurbishment of the tower. Last week, Harley’s owner Ray Bailey said that he did not know that Celotex insulation was flammable, and accused the company of ‘misleading’ his firm.

It was then revealed that his 25 year old son – Ben Bailey - was hired to project manage the refurbishment, while he had also called for a full combustibles ban; other Harley staff continued to testify, with no technical manager said to have been in place that was qualified to advise on fire performance, and an estimating error was made about cladding costs.

Then, its former design manager revealed that emails, documents and drawings relating to the refurbishment ‘appear to have been lost forever’ after a laptop was wiped. After that, it was revealed that ‘nobody’ at Harley ‘was designated with the responsibility of assessing the fire safety of products used’, alongside a series of revelations about lack of experience, cost issues and competence.

Ben Bailey then revealed that the insulation used was sold ‘at almost 50% discount’ for use on the tower, and then further evidence was given by Mr Bailey and cladding fabricator CEP’s senior sales manager Geof Blades. In October, Harley’s project manager admitted that he had not understood a warning about cavity barriers; one of the fabricators denied recommending the aluminium composite material (ACM) used; and other issues were raised.

At the end of last month it was revealed that the insulation used in the refurbishment of Grenfell Tower was ‘originally suggested’ to meet an ‘aspirational’ thermal efficiency target, but without any ‘basic checks’ regarding fire performance. Recently, representatives of cladding subcontractor Osborne Berry agreed its work on the project was ‘shocking’ and ‘unacceptable’, while another denied having a ‘lack of respect’ for residents.

Royal Borough of Kensington and Chelsea’s (RBKC’s) building control officer responsible for Grenfell, and his manager at the time, were questioned, before the council and main contractor Rydon were criticised in the first session of Artelia’s evidence. Artelia staff discussed how KCTMO had ‘struggled with design issues’, and chances they missed to help prevent the fatal fire; and had warned it that the refurbishment ‘would fail’ unless there was a ‘fundamental review’ of its scope, while resident issues and surveys were explored.

Earlier this month, Studio E were ‘not asked’ about their experience of high rise residential cladding pre appointment to Grenfell, while KCTMO’s value engineering was denied to be ‘cost cutting’; and most recently the government appointed Ali Akbor to the inquiry panel, while further KCTMO evidence was heard.

The Guardian has now reported on the latest KCTMO witness, David Gibson – its head of capital investment at the time – and said that KCTMO had held a ‘secret meeting’ to cut the costs of the project, including the ‘switch to cheaper cladding’, despite having been ‘warned by lawyers that it would break procurement law and could void the main contract’. Mr Gibson organised a ‘secret’ and ‘offline’ meeting with contractor Rydon, at which the two agree ‘more than £800,000’ in savings.

Mr Gibson confirmed the meeting – held in March 2014 – which was not minuted, and Rydon ‘subsequently agreed to drop landscaping works, cut the cost of windows, and switch more expensive zinc cladding panels’ for ACM. This cut the budget from £9.2m to £8.4m, and the £293,368 savings on cladding amounted to less than £2,500 per apartment.

He also confirmed he ‘ignored legal advice’ that these secret negotiations would break European procurement rules, as Rydon had ‘yet to be formally appointed’ after a public tender process. The company had quoted lower than rival bids and £800,000 less than KCTMO’s own advisors, but the inquiry was told KCTMO ‘still wanted increased savings before awarding the contract’, and neither Studio E nor KCTMO’s advisers Artelia were told about the meeting.

On the same day as this meeting, Rydon was appointed preferred bidder in a formal letter which ‘did not mention it had agreed’ to cut ‘at least’ £800,000 from the formal bid. KCTMO lawyers had warned the negotiations would breach regulations, and said value engineering could take place ‘after the awarding of a contract, but not before’, and Mr Gibson confirmed he had ‘read and understood’ this advice, and knew the negotiations were ‘contrary’.

Inquiry counsel Richard Millett stated that ‘there was a good reason for not telling the other bidders that one of the reasons for awarding the contract was that Rydon had agreed to reduce their price by £800,000 or so. That is that because if they discovered the TMO were discussing cost savings with Rydon prior to the award, that raised the risk of a challenge to the award decision’. In response, Mr Gibson said only ‘correct’.

He had undertaken ‘an improper and compromised process with Rydon’, Mr Millett suggested, and knew it was wrong, which explained why Mr Gibson did not mention the meeting in his witness statement, which had said the tender process was ‘rigorous and transparent’ and conducted within the rules. Mr Millett suggested this was ‘misleading’, to which Mr Gibson said ‘I disagree’.