Birmingham City Council and Amey, a UK based infrastructure support service provider, are in dispute over the City road PFI contract.

The City Council is considering penalising Amey for allegedly failing to repair roads and pavements efficiently. The firm has affirmed that it has met the required criteria for all milestone targets for highways improvements.

The road PFI contract was signed in June 2010. The contract was divided in two phases, the first 5 years of the project to improve roads and footpaths, replacing 45,000 lamp posts, refurbishing 3 main city centre tunnels and improving bridges, traffic lights, the traffic control centre and road drainage pumping stations. The next 20 years will be spent maintaining 2500 km of Birmingham's highway infrastructure.

The contract is worth a total of £2.7 billion with £608 million awarded as PFI credits per year, and the remaining £1.5 billion provided by Birmingham City Council.

Total construction costs of the project are approximately £330 million (US$502.7 million). Senior debt was provided by 6 banks: Bank of Ireland, Dexia, Lloyds TSB, Natixis, Nationwide and NIBC.

Labour cabinet member Coun Tahir Ali stated:

"The performance is not at the level it should be. Currently we are in a dispute resolution process, we're at the arbitration stage. That arbitration process has started. Both sides are around the table with a huge amount of documents."

"There are huge issues, we know about them they have been raised. Has work been done to the standard as laid out in the contract? On occasion not. Has work been missed? Absolutely."

A Birmingham City Council spokesman commneted:

"We are currently in dialogue with Amey about the way the contract is managed and run and will hopefully come to an agreement in due course. We clearly therefore can't go into any details."

A spokesman for Amey added:

"Amey is committed to providing a high-quality, effective and efficient service to Birmingham City Council and those using the highways network in the city. Since the service began in 2010, Amey has met the required criteria for all milestone targets for highways improvements."

"We hold regular dialogue sessions with Birmingham City Council to identify continuous improvements to the service to ensure we meet the needs of the travelling public."

Amey is responsible for maintaining and managing Birmingham's highway infrastructure, including 2,500km of road network, nearly 100,000 street lights, 76,000 trees and over 850 highway structures and bridges across the city.