Rydon, the main contractor on the Grenfell Tower refurbishment secretly “pocketed” £126,000 while switching the cladding to cheaper, more combustible materials, the inquiry into the deadly fire at the building has heard.
Rydon was bidding for the project in March 2014 when it told the landlord of the council block that it could save £293,368 by switching from the originally specified zinc cladding to plastic-filled aluminium panels, which the inquiry has heard had “significantly worse” fire performance.
At the time, the Kensington and Chelsea Tenants’ Management Organisation (KCTMO) was trying to cut more than £800,000 from the costs and had told Rydon it was “in pole position” to win the contract.
Rydon knew that the actual saving from the switch would be £419,627, but kept this from the client and “took some of the savings for themselves”, possibly as additional profit, Simon Lawrence, Rydon’s contract manager, admitted. The switch to the aluminium composite cladding panels, which since the fire have been banned on tall buildings, was the biggest part of more than £800,000 of savings
Rydon promised five times to appoint fire safety advisers but failed to do so. Instead, it relied on the building control department at Royal Borough of Kensington and Chelsea council, which owned the block, to advise on whether there were any safety problems. Rydon did not tell the client or the architect it was not hiring a fire expert despite having said it would do so in meetings in April, June, July, September and October 2014 as works were getting under way. The absence of a fire engineer on the team meant the cladding was chosen without consulting a specialist fire safety consultant.
Rydon was also under further pressure to save money on the job because one of its employees, Frank Smith, had underpriced the total works by £212,000. Rydon was looking for ways to “compensate” for the mistake, internal company emails showed.
Richard Millett QC, counsel to the inquiry, asked Lawrence: “Was the plan in Rydon to keep the TMO in the dark about the real extent of the savings on the ACM panels and then pocket the difference to make up for Frank Smith’s £210,000 estimating error?”
Lawrence, who admitted he had known about the plan to take the savings, replied: “That could be the reason for it.”
Millett asked: “Why was it not Rydon’s responsibility to alert the TMO that Harley had advised that far greater savings could be achieved than you were letting on?”
Lawrence said: “It probably went into risk or into additional profit.”
Chris Holt, Rydon’s site manager, asked Lawrence about the need to address fire safety, he was reassured that it was in hand. Holt said: “I was aware that as the refurbishment was to a residential block of flats, one of the main risk factors would be fire safety. When I started on the project I spoke to Simon Lawrence and asked whether I was required to consider aspects of fire safety in my role. Simon informed me that it was not part of my role and had been dealt with.”