A £55 million contract extension has been awarded to an outsourcing giant - just six months after serious failures were raised by auditors.

West Sussex County Council has given Balfour Beatty Living Places a two-year extension to its current agreement to maintain the county’s roads.

Unions described the extension as “extraordinary” coming in the wake of a damning audit which unearthed “systemic failures” in the way the contract was managed.

Just six months ago the report revealed major weaknesses in the contract, including failures to declare conflicts of interest, inappropriate gifts and hospitality.

Auditors were unable to say whether £20 million of work was value for money.

Dan Sartin, branch secretary at UNISON West Sussex, said “It seems extraordinary that the council has extended the contract for two years when only last year it came to light that the council had been overcharged by millions of pounds by Balfour Beatty.

“At the very least, Balfour Beatty has a lot of questions to answer about their role in this overcharging and that is not the kind of partner the council needs.

“It was this scandal last year that resulted in the council’s own audit function only giving West Sussex commissioning a ‘limited assurance’ rating and yet here we are extending the contract with the very same company that was overcharging us.

“Councils are big enough to run their own services and can do so at better value to the local ratepayer.”

A council official told The Argus no alternative contractors were considered to take on the work as a “mechanism” for a two-year extension was already in the current contract.

The spokesman added action had been taken to improve compliance, performance and continuous monitoring on the contract which includes responsibilities for resurfacing, safety fencing and grass cutting.

Councillor John O’Brien, West Sussex County Council cabinet member for highways and transport, said: “We are pleased to continue our relationship with our partner Balfour Beatty Living Places and we look forward to working closely with them again over the next two years."

Amanda Fisher, managing director of Balfour Beatty Living Places, added: “I am thrilled with the two year contract extension for West Sussex which is testament to the excellent service delivery provided by the industry-leading Highways Alliance.

"Our expert teams will continue to work closely with West Sussex County Council to create great places to live, work and play for local residents.”