黑洞社区

The UK construction market is heading for 鈥渟ignificant failure鈥� because of contractors underbidding, the boss of the UK鈥檚 largest private M&E contractor NG Bailey has said.

Speaking as the M&E contractor to 黑洞社区 magazine this week, David Hurcomb 鈥� who previously held board roles at contractors Carillion and Mansell 鈥� said he believed 鈥渟ome medium contractors will go bump within two years鈥�.

He said: 鈥淭he prices that work is going for are pretty scary. All it means is there鈥檚 going be some big losses in a couple of years time.

鈥淚n certain parts of the market the perfect storm is there for significant failure. There鈥檚 too many people and not enough work [and] contractors are taking on risks they don鈥檛 fully understand.鈥�

He called for 鈥渟anity to prevail鈥� in terms of contractors鈥� pricing of jobs and said contractors were 鈥渂uying up problems鈥� by taking on subcontractors at 鈥渦nsustainable prices鈥�.

He said: 鈥淪ome of these subcontractors won鈥檛 be there to finish the projects. This is what we saw in the nineties when the supply chain was virtually murdered .鈥�

He admitted NG Bailey 鈥� which this week revealed a return to a pre-tax profit of 拢7.2m 鈥� also had 鈥減roblem jobs鈥� and said the wider M&E sector had been 鈥渄ecimated鈥� and would see further casualties beyond giants MJN Colston and Airedale, which collapsed earlier this year.

He added: 鈥淲e lose jobs by significant margins at times - below cost - so there is a dogfight going on out there.鈥�

For NG Bailey鈥檚 full year results