Musings of a busy mind

This morning's Herald​ has an article by me highlighting the causes of the crisis in the construction industry.

While opinions on the cures of what ails the industry proliferate in the media, few properly address the causes. This is understandable, as each industry player has its own perspective, but few address the cause. To date, Government intervention has focussed on the symptoms, rather than reflecting an understanding of the industry itself, and how we have a booming construction sector, with contractors going bust.

On 15 August, Russell McVeagh published its report on disputes in the construction industry. The results are sobering, with over 70% of survey respondents predicting an increase in the number of disputes in the next two years.

Coincidentally, predictions at the Master Builders' Conference on 17 August were equally dire, with numerous and varied solutions proposed to what appears to be an intractable problem - high construction costs; low contractor margins; head contractor failures; unpaid subcontractors; and poor project completion. The Government then followed announcing a new infrastructure agency.

The central problem is one of managing uncertainty, and for most projects the best solution is for clients to engage with contractors to understand and to reduce, as far as possible, those uncertainties. This will not necessarily result in a cheaper price, but it will result in a more certain price and more certain delivery.