Unqualified allegations on bid rigging blamed for generating media sensationalism
The Construction Confederation has called on the OFT to clarify some of its claims following “sensationalised” media reports of its price-fixing allegations.
In particular, the confederation wants the OFT to make clear exactly what evidence it has found of illegal compensation payments, and how much the alleged price fixing has cost the public purse.
In the press release issued on the day the OFT made its Statement of Objections, it alleged a “minority” of companies had made financial gains from cover pricing. It has since been revealed that just nine of the 112 companies have been accused of price fixing for material gains.
The Construction Confederation asked: “Why were these figures not publicised in the press release, which would have helped to put these allegations in context and avoid these isolated incidents being sensationalised in media reports and so lead to considerable confusion on the part of the public sector?”
It also called on the OFT to back up its claims that prices for public-sector clients had been artificially inflated by up to 10%. The national media has interpreted this as either £300m (10% of the contracts involved in the investigation) or £4bn (10% of the total £40bn public market).
Stephen Ratcliffe, the confederation's chief executive, said: “This claim has generated extensive media coverage which in many cases has been factually incorrect and exaggerated and no doubt caused great concern among clients and the general public.
“Does this alleged 10% increase to prices apply to one contract, several contracts or all contracts? What is the evidence for this claim?
“We do not believe there is any foundation for this allegation.”