The Confederation is concerned that some of the claims made by the OFT following the publication of its Statement Of Objections (SO) have caused misunderstanding in some media reports leading to confusion in public sector clients.

The bulk of the alleged infringements listed in the SO are examples of cover pricing, where busy companies who did not want to win the work submitted an artificially high bid. If this tender was then discussed with another contractor who was also bidding for the work - for example, to confirm it was high enough not to win - it would breach competition law, even if the eventual price paid by the winning contractor was not affected.

The OFT claimed to have found evidence of more serious allegations and cartel activity amongst the construction companies, i.e. those that involve compensatory payments. However, it failed to explain that of the 240 contracts investigated by the OFT, less than 5% involved such practices. It is understood no more than 9 companies are subject to these more serious allegations.

In addition, the OFT had suggested that public sector contract prices may have been artificially inflated by as much as 10%, causing outrage in the national media and widespread concern among public sector clients.

The Confederation maintains that this figure bears no relation to this investigation and has challenged the OFT to issue a swift clarification.

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