Bid-rigging: OFT probe leads to book changes

The Office of Fair Trading (OFT) has asked publishers of a leading industry textbook to strike out sections on cover-pricing.

It is believed the OFT - which has publicly accused 112 contractors of the practice - is keen to ensure undergraduates entering the industry have no doubt that cover-pricing is illegal.

Contractors believe the fact that cover pricing was mentioned in construction guidebooks led them to believe it was a standard industry practice.

The reference to cover pricing was contained in Blackwell Publishing's 2004 edition of Construction Planning, Programming and Control by Brian Cooke and Peter Williams. It was quoted in the OFT's Statement of Objections (SO), published in April this year.

An excerpt of the SO, seen by CJ read: "The extent to which the practice was regarded as both legitimate and widespread in the construction industry is further demonstrated by a text book on the bidding process (Construction Planning, Programming and Control) that contained the following advice [see panel below] to bidders."

The book is widely used in the industry, and is on the CIOB's suggested reading list for students.

A spokeswoman for Wiley-Blackwell (formerly Blackwell Publishing) confirmed that it removed the reference to cover pricing in the reprint that followed the 2004 version.

She said: "Following notification from the OFT, we took it up with our authors. They were quite definite that this sort of thing had been happening for a while, but we removed the offending text at the next reprint."

She added that the book had never recommended cover pricing as a practice, but had merely acknowledged that it was common in the industry.

The OFT declined to comment.

"Degree of competition" - the controversial quotes from the industry textbook

• How many contractors have been invited to tender?
• Which contractors are on the tender list?
• Obtain details of competitors by making contact with material suppliers or specialist subcontractors listed in the contract documents.
• Do we want the work or should we take a cover price (ie an arrangement whereby one contractor is given a price by another contractor which is then submitted as a tender offer. The price will be sufficiently realistic to look like a bona fide tender but high enough so as not to win the contract)?