Half of construction project tenders below cost -- survey
Published 22/08/2011 | 05:00
CONSTRUCTION companies are threatening their own industry and putting vital infrastructure projects in jeopardy by tendering for jobs below cost, the Society of Chartered Surveyors warned yesterday.
A new survey from the society showed that just over half of all tenders for construction projects were now coming in below cost, up from the 37pc two years ago.
The survey also found that:
•Of the 86 firms surveyed 97pc reported an increase in below-cost tendering over the past three years.
•Surveyors believe below cost tenders are on average 17pc lower than the "realistic costs".
•Some 55pc of quantity surveyors have experienced projects failing to be completed because they were below cost.
•Around 83pc of quantity surveyors have experienced a client accepting the lowest bid even though it was "considered" below cost.
"The longer-term consequences for projects that cannot be completed at the tendered price cannot be underestimated," said society president John Curtin.