Minister Murphy said: “Covid-19 has had a huge impact on the availability of construction materials with global demand, product shortages and delivery delays leading to market volatility and increased prices.
“Government contractors are experiencing escalating costs and delays in getting materials which they could not have foreseen when they tendered for government work. I have listened to the concerns of the construction industry and want to do everything in my power to ensure there is no risk to the completion of important projects.
“I am pleased the Executive has agreed my proposals to make provision to manage delays in supplies and to include mechanisms in existing and new contracts to make allowances for inflationary prices. This will provide vital support to our construction industry which will play a key role in our economic recovery while also ensuring important government projects such as schools, hospitals and infrastructure projects are delivered.”
Mark Spence, Managing Director of the Construction Employers Federation said: “We welcome this vital lifeline for local contractors who for many months have been shouldering the escalating burden of unforeseen global price increases and material shortages whilst ensuring public works continue to be delivered.
“We particularly welcome the Minister’s recommendation for all new government contracts to provide protection from such external factors in the future. NI construction employers are essential partners to the Executive in delivering every aspect of public services and have continued to do so throughout the pandemic. These proposals start to address the previous imbalance of risk in taking on government contracts and can assist in ensuring continued delivery of public investment in infrastructure.
“Between now and the review point at the end of September, we will be constantly monitoring industry feedback on the Advisory Note – however we very much hope that it gives a strong basis for many of the current challenges facing our membership to be proactively dealt with.”
For more information and to read the full Procurement Advisory Note, visit https://www.cefni.co.uk/news/