Westminster’s former Labour administration has faced criticism after awarding a multi-million-pound demolition contract to Keltbray, despite the company having been fined £16 million for bid-rigging by the Competition and Markets Authority. Westminster Conservatives say the decision raises serious questions over Labour’s procurement process and have pledged greater scrutiny of major council contracts to ensure better value for taxpayers. Labour has defended the decision, arguing there were few technically qualified contractors available to carry out the work.
The article below by Kathrine Gray is in the Independent, and you can read it here.
Labour council awarded major contract to firm fined £16m for bid rigging
The former Labour administration awarded Keltbray the contract for demolition works related to the Church Street regeneration project
Westminster’s former Labour administration has been criticised for awarding a major contract to a demolition firm previously fined millions by a UK market regulator.
Keltbray was fined £16 million by the Competition and Markets Authority in March 2023 for colluding on prices when submitting bids in competitive tenders for contracts. The company was among 10 firms collectively fined nearly £60 million for engaging in rigged bidding practices.
The bids were rigged by one or more of the construction firms agreeing to submit bids that were deliberately priced to lose the tender. This practice, known as ‘cover bidding’, can result in customers paying higher prices or receiving lower quality services.
Despite this, Westminster City Council, under its then-Labour leadership, granted Keltbray a £3 million contract for demolition works related to the Church Street regeneration project.
Conservative Councillor Paul Fisher, now Cabinet Member for Value for Money and Finance after the Tories took back control of the council in May, challenged the decision at a recent Value for Money and Transformation Policy and Scrutiny Committee last Monday.
“My question to members of the council is – insofar as we can do, don’t we want to avoid that? Through proper due diligence and contract management,” he asked the committee.
The issue comes as the new Conservative administration promises to carry out a review of all council contracts over £5 million.
Keltbray’s fine was further increased to £18 million in December 2024, after a failed appeal by the construction company.
In July 2025, Keltbray’s contract value with Westminster City Council was then increased by over 100 percent – to £6,310,634 – after it was found out that they would need to carry out additional works to complete the contract.
Councillor Ellie Ormsby, Leader of Westminster Labour Group, has defended the decision to use Keltbray as they were one of only two companies “technically capable of delivering the work” – both of which had engaged in cover bidding.
She told the LDRS that the decision to award this contract, which received 10 bids, was undertaken by her predecessor. Five of these ten had previously been found to engage in cover bidding
Cllr Ormsby said: “Given the limited pool of suitably qualified contractors, there were no viable alternative bidders who met the technical requirements of the project.
“Who would the Conservatives have appointed instead: a company that was not technically capable of delivering the work, or one that was significantly more expensive?”
Once demolition commenced, further issues on the site which “could not reasonably have been identified beforehand became apparent”. These included undiscovered basements and asbestos.
Cllr Ormsby added: “Addressing these issues was essential to ensure the work could be carried out safely and resulted in a change to the project’s scope and, consequently, the contract value. The extra work would have been needed whoever had the demolition contract.”
