Holdfast Training Services Trial Blog

Me and Henry got swept up last week in the Baltimore Military Professional Development visit, part of which was to the Pentagon to see a failed project. This portion only lasted a short while so I don’t know all the the ins and outs, but it was interesting none the less and raised some interesting points.
The project itself is to upgrade a goods and service entry point to the Pentagon, and is one of the final upgrades required for the whole site. It’s a job worth a relatively small figure but is fairly high on the Pentagon list of priorities. It was procured on a traditional contract and awarded to what is called an 8A contractor. That is, it was awarded to a smaller ‘disadvantaged’ company in line with the government social sustainability responsibilities. To qualify as a smaller company doesn’t necessarily mean it’s a ‘pikey’ outfit with a white van for a head office, and the company that won the award employs c. 500 personnel. It must also have a history of successful contracts which it will have submitted as part of its tender. As mentioned the contract was terminated by the government for non performance. It seemed that the contractor felt that it couldn’t complete the awarded contract due to the amount of variations it was presented with when it arrived on site. Apparently some of the SI was incomplete and there were a number of underground utilities which were encountered unexpectedly. This seemed strange given that to a contractor variation typically means additional money? Especially on government contracts where I’ve been told that some of the larger principal contractors have a reputation of tendering for work with the aim of tying the government contracts in knots (driving a bus through) and making small fortunes. One theory I can think of is that in adhering to government requirements there are certain administrative obligations placed on contractors. If the contractor was not used to this, which implies a lack of rigour at the contractor selection board, then perhaps it was not especially well set up to comply. This could potentially mean that payments (or a percentage of them) for work were held back by the government. This would affect the contractor cashflow and may have had the opposite effect to that intended. (ie demotivated the contractor)
The contract duration was around 12 months, however in 12 months all that had been installed was some signage and fencing and 4 manholes with connecting runs. Certainly not the progress I’d expect from a competent contractor this hints at a level of ineptitude or lack of direction. At present the Pentagon is demanding of USACE a resolution, which USACE is currently administering. The bonds will be cashed in and go towards paying the contract sum lost for payment of work to date. This will draw a line under the old contractor’s responsibilities under contract which will probably be novated to another principal contractor. The whys and wherefores are probably more interesting the deeper you dig, however because the case is current the guide was very tight lipped. What struck me was the risk that the government takes on in discharging its social sustainability responsibility, particularly on a project at the Pentagon, and the seemingly missed opportunity by the ‘disadvantaged’ contractor which will now likely never win another government job in its future