This Article was published in Contract Journal, 26 March 2008, page 5

Standard contract changes cost £18bn a year

Meddling with standard contract terms is costing the building industry more than £18bn a year.

Leaders of the Confederation of Construction Specialists (CCS) have now launched a campaign against the changes, which are leading to huge amounts of risk being 'dumped' on trade contractors.

The Confederation is calling on banks and financiers to insist on standard contract forms that define a clear chain of accountability at every stage of the construction process.

A Confederation spokesman said: "Existing JCT'05 contracts do already provide a clear chain of accountability, meaning every individual and organisation in the supply network is held responsible for delivering its part of the contract.

"However, CCS has found the chain is increasingly being disregarded, by means of "risk dumping". This is where standard contracts are changed so the onus of blame falls on just one organisation - most often the subcontractor.

"Not only is this situation unfair for our members, it also means that every organisation in the supply chain has to repeat design calculations at every level to check the information given to them. This is an incredibly inefficient and time-consuming process that is increasing costs by up to 30% - an extra £18bn every year."

The Confederation is now calling for a series of meetings with the government to discuss the issue.