Building contractor collusion investigation. Corruption or systemic failure?

[Tony]

There are a few people who don't understand what has actully happened here, but don't let that get in the way of a good old rant at favourite hobby horses.

[splodgeyAl]

Looks like what the govt. and LAs should do is, after all the tenders are in, knock 10% off the lowest and offer the job at a fixed price with stiff penalty clauses.

 

and thereby ruin their chances of a nice directorship / consultancy gig when their time as a "public servant" is up?

 

they'll never do that

[andco]

There are a few people who don't understand what has actully happened here, but don't let that get in the way of a good old rant at favourite hobby horses.

 

As you clearly do think you understand what has actually happened here and in order to avoid/prevent a good old rant at favourite hobby horses, perhaps you could tell us all what you thinks going off here in reality.

[StarSparkle]

There are a few people who don't understand what has actully happened here, but don't let that get in the way of a good old rant at favourite hobby horses.

 

It's all part and parcel of the old boys' 'you scratch my back and I'll scratch yours, and I'll turn a blind eye to anything you want' way of doing things that has for so long been endemic in this country.

 

The details don't matter, it's the overall way of behaving that's the problem.

 

StarSparkle

[andco]

It's all part and parcel of the old boys' 'you scratch my back and I'll scratch yours, and I'll turn a blind eye to anything you want' way of doing things that has for so long been endemic in this country.

 

The details don't matter, it's the overall way of behaving that's the problem.

 

StarSparkle

 

Looks like great minds think alike. Prhaps he'll think we're all ganging up on him now.

[Tony]

As you clearly do think you understand what has actually happened here and in order to avoid/prevent a good old rant at favourite hobby horses, perhaps you could tell us all what you thinks going off here in reality.

So you really want to know or are you just being sarcastic?

[Anna K]

I am just so fed up of seeing my taxes used and abused in such ways, and so frustrated that there's nothing anyone seems to be able to do about it.

 

Is it any wonder that people 'get there own back' by fiddling the system where they can?

Corruption starts at the top but polutes the whole of society.

[Tony]

Oh dear, the OFT seems to have been making a bigger deal out of this than was neccesary. I wonder, is a funding round due?

 

From Building magazine

Only nine firms benefitted from bid rigging

18 April, 2008 By Alex Smith

 

Senior indsutry source says payments were paid to bid 'losers' on only 12 occasions

 

Only nine of the construction firms alleged to have rigged bids by the OFT have benefited financially, an industry source has revealed.

 

The majority of the companies named by the OFT were guilty of cover pricing, which is the practice of placing bids that were known to be too high to win a tender.

 

The nine compenstated those deliberately losing bids in only 12 instances. The OFT has claimed to uncovered 240 cases of corruption in total.

[Darbees]

Are we supposed to be surprised about this "news". I made a comment on a thread a few weeks ago to the effect that councils were being stitched up by contractors only to be rubbished by certain vociferous council (or connected to council) members here. None so blind as them that will not see.

[Tony]

For those who don't understand what has happened, here's an explanation from an article in Building:

 

Cover pricing is not a widespread evil

21 April, 2008

 

“We will have to get a cover price on this one” said the chief estimator. I was then a mere baby to this building lark.

 

“What’s a cover price” whispered me to one of the other babies.

 

“It’s what we do when we are up to our whatnots in work in the estimating department but don’t want to appear disinterested in bidding”.

 

My boss eventually explained that he would speak to the chief estimator of one of the other bidders and ask him what we, his competitor, should bid. Blow me; sounds a bit iffy. And if the local Office of Fair Trading sleuth heard of it, I bet she would bounce around like a hen on a hot griddle. Calm down girl. What’s the fuss?

 

Now let me tell you I know all about cover pricing first hand. And let me tell you two things for certain. First it was ever so rare an event. Second, I never ever saw, nor heard even a whisper in all these years of money ever passing hands in getting a cover price.

 

Why rare? Easy. We damn well wanted the work. We weren’t in the business of employing bricklayers, carpenters, managers to sit on their backsides doing nowt. We were builders who, like all other builders, broke our bloody necks to win contracts.

 

That chief estimator down the road, our competitor was doing the same. He, and us, and the six other mugs bidding for a school or old people’s home fought tooth and nail to get on tender lists. It’s balderdash to imagine we then didn’t want the next job. So why a cover?

 

Because our estimating department was so busy fighting to win work, we couldn’t squeeze another ounce of time to properly bid for this latest invitation. The reluctance to turn down the invitation, the reluctance to get a cover was enormous. Understood? So was the client cheated? No, not a jot.

 

He would still get seven bids from seven enthusiasts in the cockeyed rush to win the job. It would need a massive coincidence to have seven out of the eight too busy at that moment to bid. And anyway what was the ordinary alternative.

 

No, we would not decline to bid, we would just go in with a guess... a high guess... hoping we wouldn’t win. And we never did. Come to think of it, we hardly ever won a school or old peoples home unless, unless we made a pricing mistake.

 

So, of cover prices, oh okay take a thick ear. Instead of seeking a cover the busy builder will still bid but price himself out. But tell me that builders are entering on a conspiracy to divvy up jobs, take a lump of money for a cover price and I will give you a rude rebuff. That’s baloney! If I am wrong show me. Tell me which prison these folk go to I will eat my safety helmet in front of the bars. Meanwhile baloney!