Tony Bingham was right “on the money”, so to speak, in his article exposing the obvious weakness of the OFT’s stance on cover pricing

If a contractor is given a figure that it knows is bound to exceed the lowest tender, the OFT can impose a huge fine. However, if the contractor prepares a figure itself that it knows is bound to exceed the lowest tender, the OFT accepts that this is fine.

Whichever of the two approaches is taken, cover price or high price, the real difference to the employer is £nil. The employer still gets the benefit of the same lowest bid and loses nothing. The only exception to this is if there is fraud involved, but that is a different thing altogether. It seems to me that the OFT does not really understand the difference – but TB clearly does.

Christopher Linnett

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