Welsh Government pays £13m to settle road contract claims

THE Welsh Government made a £13m “special payment” to settle claims over road contracts and lost more than £2m on defunct technology, according to scrutiny of annual accounts.

- CHRIS HAINES

Welsh ministers shelled out £13.1m, excluding VAT, after contractual claims for additional money for three road projects amid spiralling costs due to high inflation.

Andrew Goodall, the Welsh Government’s permanent secretary, said in a letter that his officials sought to settle all claims with the contractor in the interests of value for money.

Pressed by the Senedd’s public accounts committee about the consequences of not settling, Dr Goodall raised the risk of delays to roadworks and the loss of European funding.

He wrote: “Not settling all claims would have left the Welsh Government open to the risk of unsettled claims being leveraged by the contractor at a later date.”

Wales’ most senior civil servant added: “Whilst there’s no guarantee the contractor would have commenced formal dispute proceedings for amounts they considered were due, it was deemed that there was a real chance of them doing so.”

He said such pushback was not unique to the Welsh Government, with other public bodies also grappling with the reality of contractors no longer being willing to take on certain risks.