Bid-riggers to face action

15 October 2009

16 October 2009 | Jake Kanter

UK councils may take action against construction suppliers fined for bidrigging by the Office of Fair Trading (OFT).

In Bolton a councillor is calling on the authority to scrap its three-year building framework deal after two suppliers were penalised by the OFT.

And 22 councils in a construction-buying consortium covering Yorkshire and the Humber are deliberating over whether to invoke a clause enabling them to terminate framework deals with chastised suppliers.

The OFT fined 103 construction firms a total of £129.5 million last month for engaging in illegal, anti-competitive activity on 199 contracts between 2000 and 2006 (Web news, 22 September).

Bolton Council's Conservative group leader John Walsh said this year's £1.5 million building works deal should be retendered to exclude suppliers G&J Seddon and Bramall Construction. After seeking legal advice, he tabled a formal motion to abandon the contract and was expected to raise the issue at the authority's cabinet meeting this week. He said the framework deal was damaging to a number of local suppliers that failed to win work.

"I hope the council's controlling group will accept my argument that pertinent facts were not considered at the time of the contract award and therefore the contractors' framework should be set aside," he told SM.

Elsewhere, members of the YORbuild consortium, which introduced clauses allowing participants to drop deals with at-fault vendors after the OFT began investigating, are deciding whether to employ the clause.

Meanwhile, a report published this month by not-for-profit group Constructing Excellence said purchasing practices in the UK building industry are "not as professional as they should be".

SMoct2009

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