The South Australian Government has expressed confidence the tender process for a new city hospital will be competitive, despite just two bidders remaining.

Plenary Health's withdrawal leaves Torrens Health Partnership and SA Health Partnership competing to build the new Royal Adelaide Hospital (RAH) at the western end of North Terrace in the city.

Deputy Premier Kevin Foley says the remaining bidders will not have to be compensated if there were a change of government at the South Australian election on March 20.

Mr Foley says Plenary Health could not meet the Government's conditions for the next stage of the bidding process.

"There were some disagreements or there were some issues involving some of the partners in the group at the end that clearly meant that they weren't in the position to go forward as a successful consortia," he said.

Mr Foley thinks the Government can still get the best deal out of having just two bidders.

"It reduces the chance of them not being successful and by definition will make them extremely competitive and will go at it very, very hard," he said.

Stick loss</h3>;

An investigation has found a computer memory stick which was lost held information of little value to bidders for Adelaide's new city hospital.

The USB was lost by a South Australian Health Department worker earlier in the year and contained commercially-sensitive documents.

Mr Foley says an inquiry by the Crown Solicitor has concluded the loss was accidental and an Ernst and Young review found the information was of little commercial value.

"The information on it is not deemed to be of critical nature to the project at all and in fact much of the information is very, very dated, going back at least 18 months ago or more," he said.

"We're very confident that we've now dealt with that issue properly. As I said Ernst and Young have reviewed the issue in terms of the documentation, the quality of it. Old, of little use and the Crown Solicitor's office advice is that in all probability this has been an accidental loss and not on any corrupt basis."

Mr Foley said the bidders would not be able to use any of the information for advantage.

"They have now legally agreed that should they be found to have used this information in any way, shape or form there will be quite crushing penalties attached to it," he said.