When the Office of Fair Trading accuses the supermarkets of price fixing, consumers don’t demand assurances at the checkout that the butter they’re buying has been fairly priced.
Nor do they take their custom to the corner shop.
How very different it is for the 112 construction companies accused of some form of bid rigging. The accusations have riled anyone remotely connected with the public sector and they’re looking round for contractors to take it out on. With half of the industry’s workload coming from the public purse, it’s not surprising to see this kneejerk reaction, even if it’s not entirely logical and runs counter to advice issued by the OFT itself. What official wants to be hauled over the coals by their political masters for handing out work to a dodgy builder? Although there is still no evidence to show these firms are losing contracts yet – but how can they know for sure? – councils have started taking action. A fortnight ago Bolton scrapped its framework because G&J Seddon, one of the firms accused by the OFT, was on it. Now there’s a flood of local authorities and housing associations contacting lawyers to ask them to investigate contracts that the OFT did not consider.
Nobody has actually been found guilty of anything yet. But as Chris Addison says, the industry has one of those damned-if-you-do, damned-if-you-don’t profiles. And as contributors to our legal special also point out, over the past 14 years UK construction has been the subject of eight UK and EU competition inquiries. So trying to get any sympathy here is a bit like Cherie Blair trying to win us all over by playing the downtrodden spouse in her autobiography. It doesn’t wash and, frankly, in Cherie’s case, will make her even less loved. The public sector is right to be cynical.
What nobody has the right to do is to be judge and juror. But contractors are finding that they can’t use the most obvious defence, which is that offering a cover price is not the greatest evil known to man. And nobody outside the sector is riding to their rescue. That’s partly because breaking the law is seldom a beautiful thing and partly because nobody want to be seen as an apologist for shoddy practices. It doesn’t help that legal repercussions may ensue if firms themselves hold up their hands. The advice from the OFT on what they can or can’t say is confused. There is also the received opinion that bid rigging has added 10% to the cost of building hospitals and schools. That hare was set running by the OFT on the day it published its statement of objection, which it still has to clarify. And which, of course, is simply adding to the moral panic.
There is no doubt the industry has a massive PR problem on its hands – hence our Rebuilding Trust campaign – but is the industry so bad, so riddled by corruption that it deserves to live under a cloud of ignominy until the OFT publishes its report next year and we know the extent of damage? Of course not.
Denise Chevin, editor