Councils accused of favouring big firms

Fears are growing that SME contractors are being squeezed out of public sector contracts as local authorities and other clients turn away from tendering single buildings in favour of high-value framework packages.

As this practice bundles several small contracts into multi-million pound deals, only major contractors with financial muscle are deemed eligible to take them on.

Two members of the CIOB’s Chartered Building Company Scheme have recently contacted the institute to report allegedly unfair practices by local authorities.

‘The councils used to say jobs shouldn’t be more than 25% of turnover, but that’s now reduced to 10%. As an SME, we’re at disadvantage,’ said the director of one of the firms.

The National Federation of Builders is preparing to survey its members on the scale of the problem. ‘Two years ago, we saw a drift away from public sector work. But now the public sector is where the work is, so the problem is more acute,’ said Kurt Calder, spokesman for the NFB.

‘We had a case study where a local contractor built a school, but was not deemed large enough to bid to maintain it, because it’s packaged as a framework,’ he added.