SCSI – Tender Price Inflation at 14%

Cogent Managing Director and SCSI President Kevin James shares key recommendations for Government, on the back of the latest SCSI Tender Price Index results.

Commercial construction tender price inflation is running at 14%, following an average increase of 7.5% in the first 6 months of this year.

The SCSI recommends to Government to address inflation by focusing on soft costs such as planning reforms and utility connection charges. Government should reduce overall levels of risk and costs of delivery where they can, such as reducing planning delays and timelines.

 

Tender Price Index – July 2022

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SCSI Reports 13% Construction Price Inflation in 2021

Cogent Managing Director Kevin James offers insights into SCSI findings of 13% construction price inflation in 2021, on RTE Radio 1 Business News.

The main reasons for current price inflation are high price volatility across a range of building materials — particularly insulation, cement, plasterboard metals and fuel – labour shortages and the extremely high demand for projects across all tiers as the industry continues to readjust in the wake of the Covid crisis.

The SCSI calls on government to introduce additional measures to ensure existing projects are afforded a level of price variation. This will enable contractors to respond to frequent material prices increases and ensure more balanced risk pricing.

The industry will have to step up its cost benefit analysis of materials, utilise modern methods of construction, identify innovative cost saving solutions and streamline pre-construction periods to minimise the impact of inflation.

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Tender Price Index

The Society of Chartered Surveyors Ireland Tender Price Index Report has forecasted a national increase of 3.35% for the first 6 months of 2019. The report also highlights a slowing of tender inflation for the first time since early 2017. This will bring construction prices back to peak 2007 levels.

SCSI QS Group Chair and Cogent Associates Managing Director Kevin James, explained that “allowances for Tender Price Inflation (TPI) among construction projects vary according to their sector, size, complexity and location, therefore advice should be sought from a Chartered Quantity Surveyor before deciding an appropriate TPI provision for your construction project.”

Tender Index Mar 2019

 

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