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Daily Record
Daily Record
National
Gordon Blackstock

Spanish firm in £100m legal fight over cash lost in upgrading M8, M73 and M74

Road chiefs face a multi-million pound claim from the firm who built parts of Scotland’s largest motorway.

Spanish contractor Ferrovial is trying to claw back money it lost on upgrading the M8/M73/M74 in one of the country’s biggest infrastructure projects.

The mammoth work, which caused years of chaos for drivers across the central belt, was carried out with an arm of Irish builder Lagan Construction, which has since folded.

Ferrovial, which also owns motorway firm Amey and has stakes in Glasgow and Aberdeen airports, lost at least £48million on the contract.

Works to sort out poor workmanship and defects on the road are still ongoing.

Sources say the legal action is in excess of £100million and centres on allegations the project spiralled out of control due to Scottish authorities hindering parts of the work and soaring labour costs.

An insider said: “Losing so much money has been a disaster and is the latest major construction project in Scotland that’s gone awry.

“Some may argue that’s the Scottish taxpayer getting good value for money but it puts firms off bidding in the future – or ends up in claims like this down the line. And if we can’t get these massive firms to do the work, who will?”

Ferrovial was set up in 1952 by Rafael de Pino y Moreno.

Rafael de Pino y Moreno – pictured with son Rafael – set up Ferrovial in 1952 (Cover/Getty Images)

He went on to become one of the richest men in Europe with an estimated fortune of £5billion before he died in 2008.

His son, Rafael, is still the firm’s executive president and Spain’s sixth-richest man.

None of the parties involved would confirm the size of the claim that has gone in for “commercial reasons”. Earlier this year, construction firm Galiford Try confirmed it was closing a large part of its Scottish business.

The firm was a partner in building both the Queensferry Crossing and the Aberdeen Peripheral Route and had lost money after Aberdeen bypass partner Carillion collapsed.

Neil Greig, director of policy and research at motoring organisation IAM RoadSmart, said: “This claim takes the shine off the large programme of roadbuilding the Scottish Government has engaged in.

“Ultimately, settling claims like this takes money out of the pot of the future programme of road building.”

Scottish Tory transport spokesman Jamie Greene said: “The public expect the SNP Government to run these projects on time and on budget but repeatedly end up settling cost overruns in the courts.

“It faces being sued by contractor after contractor and it’s public money that will have to foot the bill.”

First Minister Nicola Sturgeon opened the £500million M8/M73/M74 Motorway Improvements Project in 2017. Transport Scotland said it would be inappropriate to comment on specific claims.

But they said that it wouldn’t be unusual on major infrastructure projects of this scale for contractors to make a request for additional money where works and/or services were beyond what was required by the contracts.

They said: “We would carefully consider the validity and quantum of any request for additional monies based on robust evidence submitted by a contractor, in line with our financial processes, to ensure value for money to the Scottish Government and the taxpayer.”

Ferrovial declined to comment.

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