Contractors pushed to drop prices to keep projects alive

Some 50% of housing associations said they will ask suppliers to cut their prices; 35% of local authorities admit they are more likely to cancel projects over the next six months; and 33% of health authorities predict they will retender projects to get costs down.

The survey, carried out by the Constructionline prequalification certification scheme, found that 68% of public sector clients have reduced construction budgets for the next six months.

The survey also asked about how clients planned to achieve savings. Adding new contractors to supply chains (25%), retendering for frameworks (21%), price benchmarking future tenders (32%) and retendering for projects (34%) will be popular methods applied by public sector clients over the next six months.

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