Construction industry unites to reduce cost of disputes

Construction industry unites to reduce cost of disputes

Six leading institutions, and two of the UK’s biggest employers, have launched the Conflict Avoidance Pledge, aiming to put an end to the number of disputes in construction and engineering.

The pledge, created by the Conflict Avoidance Coalition Steering Group – who work to help the industry reduce the costs of conflict, and ensure major infrastructure and property developments are delivered on time and budget – is a voluntary commitment self-assessment open to any organisation or firm regardless of size or location.

The Pledge is the focal point of a wider campaign, set out by the Steering Group to drive behaviour change in the way relationships and disputes are managed throughout the construction and engineering sector.

The ambitions of the Steering Group are to reduce financial and other costs associated with disputes. This involves promoting cooperation between contracting parties; and helping people and organisations to understand and use conflict management measures, which will ensure projects are delivered on time and on budget.

Over 50 industry bodies have signed the Pledge, with a key ambition of the Steering Group to encourage more organisations to join the coalition.

Moving forward, the Steering Group is developing guidance and toolkits which will inform organisations about the value of conflict avoidance and early intervention techniques, and how to access and use them. These toolkits will be available to all signatories of the Conflict Avoidance Pledge.

“Too often, employers encourage contractors to submit compliant bids for the best price, while contractors, on the other hand, apply a commercial strategy to win the bid,” said Dr John Fletcher, RICS Product Group Director ADR. “Both sides then seek to manage contracts to their terms. The result is a recipe for disputes, which is built into contracts before they even start.

“On average, the ultimate price of a construction project can come to c.30-40% higher than the original contract target price. Employers and contractors can all too often end up not focusing their energies on the successful delivery of projects, but on arguing over 20% of the overall costs.

“It is only when the industry unites to tackle these all too common issues that we can deliver real change. We look forward to more organisations and companies joining our campaign by signing up to the Pledge and making the running of construction and engineering projects, hopefully across the world, more streamline.”

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