Patrick Flannigan resigns from NBN Co just days after it was forced to suspend construction tenders negotiations.
Flannigan, who was in the role for just 18 months, shock resignation has come as a major blow for the company.
No reason has been given for the sudden resignation, although a spokesperson did say it was “disappointed Mr Flannigan has decided to resign, as he made a valuable contribution to the senior management team”.
The tedious tenders negotiations, which has been going on for an extended period with several major construction firms, including Telstra, was halted due to what the NBN Co said was exhorbitant pricing schemes put on the table by all 14 companies.
The builders were bidding for work laying cables for the fibre network, said to be worth around $12 billion. However, the companies involved, which included John Holland, Transfield and EDI, pushed the prices even higher, the NBN believes.
None of the bidders offered “acceptable terms and prices,” it said. The building industry had made the case for higher prices arguing capacity constraints and spiralling wage costs were boosting costs.
This would have placed an extra financial burden of around $3.7bn onto the already hefty $36bn bill for the network build.
Following the tender rejections process last week, the broadband company was said to be working on a ‘Plan B’ for the fibre network build.
“We have said all along that we are building an NBN, but not at any price,” said Head of Corporate Services, Kevin Brown.
The NBN Co, already under pressure over costs from the opposition and other detractors, have refused the higher price scenario as fair value, and maintain they will seek best value for money for taxpayers.
Flannigan was the founding MD and Chief of ASX listed Service Stream, a major provider of infrastructure and construction services to the telecommunications sector.
Dan Flemming, GM construction design and planning, is to take over the reins until a suitable replacement is found.
