FCEC fights for survival

Urgent top-level talks are under way in a desperate bid to save the 77-year-old Federation of Civil Engineering Contractors. The move follows the decision of the country's 11 biggest contractors to withdraw from membership at the end of this year.

The loss of the 11 top firms in the newly-formed Major Contractors Group will cut the FCEC income's by 25%. Some industry sources believe this could push the federation into bankruptcy.

The FCEC was already skating on thin financial ice even before the majors' notice of withdrawal. Total membership has slumped by a third over the past ten years and the federation's problems have been accentuated by a sharply declining industry workload.

A trading deficit of œ95,000 in 1994 led to a substantial tranche of staff redundancies.

Even after a programme of cuts, the federation managed to achieve a post tax surplus last year of only œ7,000 on a turnover of œ2 million. A crucial factor in the financial picture is the FCEC's high office occupancy costs which eat up more than a third of its income.

The federation nonetheless remains optimistic about its future. FCEC chairman Howard Stevens commented this week: "The majors have made it clear that it is not their intention to see the federation disappear. Their initiative will not lead to its collapse."

Behind-the-scenes discussions have been revived aimed at achieving the majors' stated objective of creating greater unity in the industry's political structure. One means may be to build on and strengthen the existing Construction Industry Employers Council (CIEC).

But, if talks fail, then the end result could be the crippling of the FCEC and a further fragmentation of the industry - the precise reverse of the majors' intentions.

Latest federation returns confirm its vulnerability. Total membership last year fell by 8% to 262. This compares with a total of 400 member firms in 1985 and 639 in 1975.

The 1995 total income fell by 3% to œ1.96 million, of which œ1.57 million was from membership subscriptions.

FCEC director general John Hackett commented: "We are at one with the majors in seeking a more effective employer voice for the industry as a whole. We are working with them to achieve that aim while still seeking to keep them on board the FCEC."