Unknown outcome after firm linked to City Rail Link put in administration
Friday, 23 November 2018
Concerns have been raised over how Auckland's City Rail Link will be impacted after an Australian firm contracted to work on the project was put into administration.
It was announced on Friday morning that engineering group RCR Tomlinson was put in administration by McGrathNicol.
Despite executive general manager of RCR's New Zealand entities, Andrew Stevens, saying the CRL wasn't affected, concerns for the project lingered.
A City Rail Link Ltd (CRLL) statement said it would be meeting with receivers on Friday to discuss the ramifications of the administration.
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Public Transport Users Association national co-ordinator Jon Reeves said waking up to the news that RCR Tomlinson was in administration was concerning, to say the least.
Reeves also wasn't so sure that CRL wouldn't be affected as a result.
CRL is one of NZ's biggest transport projects, costing $3.4 billion.
The 3.4 kilometre underground train line will connect four stations in central Auckland. Britomart and Mt Eden stations will be redeveloped and new stations will be built at Karangahape Rd and Aotea Square.
Reeves said the administration was going to impact CRL 'somewhere along the line'.
'There has to be [impacts] because you are dealing with a company that is now in receivership in Australia and owns a company in New Zealand,' he said.
'It's still a concern but finger's crossed it's less of a concern if what has come out . . . is true.'
Reeves said the outcome for the project would be clearer in coming weeks as new information emerged.
He said public transport users often asked the association when the project would be completed.
'They are really keen to use it, especially people who work in the central city.
'I know there is certainly an appetite from the public, they really want this train system and the new tunnels to open.'
Transport Minister Phil Twyford said he had asked for a briefing on the situation from CRLL and would continue to monitor the situation.
Infrastructure NZ chief executive Stephen Selwood said he didn't believe RCR being put in administration would affect CRL at this stage.
Selwood said he understood the rail link was still in the design stages with RCR's partner WSP Opus, and the company had not yet begun its electro-mechanical work.
RCR had strong contractual obligations and it was still possible the Australian parent could climb out of administration, or be bought out by another company, he said.
At this point, Selwood thought it unlikely the CRL contract would need to be re-tendered.
'I do know the New Zealand side of RCR Tomlinson has been trading profitably and this is a good contract for them.
'So even if the parent company falls into further difficulty and administration may prove to be a successful outcome in its own right . . . I would expect that this would be attractive to other, either New Zealand or international companies, given that there's a strong contract in place.
'Certainly the thinking at this stage for all parties is business as usual.'
CRL chief executive Sean Sweeney told Radio NZ RCR Tomlinson going into administration had 'zero impact' on the CRL.
'The work they are in contract to do is to deliver a design solution for the rail systems contract. And that work is to be completed next March,' Sweeney said.
On Friday morning, a worker from Downer NZ – one of the CRL's construction partners – who was controlling traffic management around the CRL project said she had read about RCR Tomlinson going into administration in the news.
She was not concerned for her own company as RCR Tomlinson was on a different contract to Downer NZ, the worker said.
Downer had been working on the project for about six months and everything was going well, she said.
CRL is due to open in 2024.