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'Bid-peddling' slammed Yvette Shapiro

RECOVERY in the Northern Ireland construction sector will not occur until tender bids return to "realistic" levels, a building industry chief warned today.

Gordon Burnison, director of the Construction Employers Federation in the province, said the organisation's latest quarterly survey revealed serious concerns about pricing of contracts.

"Tender prices are still too low and, in order for firms to win contracts, they are being forced to offer unrealistic prices."

In May, the Housing Executive revealed that some firms were building houses at a loss because they were so desperate for business.

Earlier in the year, the Northern Ireland branch of the Confederation of Specialist Engineering Contractors claimed that "bid-peddling" was making a mockery of the tendering process and was damaging to the entire construction industry.

Low pricing is putting pressure on a sector which is currently struggling to climb our of recession, according to the Construction Employers Federation survey which shows workload levels down in almost every area of activity.

The results are disappointing, since a survey earlier in the year reflected more "positive trends" and predicted an improvement in volumes by now.

"Demand has flattened in recent months and the recovery anticipated earlier in the year has not been sustained," said Mr Burnison.

Unemployment levels, which fell earlier in the year, are now climbing again: around 18,400 construction workers are currently on the dole.

Despite the current gloomy situation, the Federation is optimistic for the second half of the year.
