Landlord cracks down on suicide bidding

Aaron Morby 12 years ago
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A London housing association has written new clauses into tenders to stamp out suicide bidding.

Suicide-bidding was blamed for last year’s collapse of contractors Connaught and Rok. The signs are that the problem has still not gone away, with reports of some bids being made 20% below the average.

Poplar Harca introduced a clause in tenders awarded as part of its £145m refurbishment programme on 8,400 homes.

The clause gives Harca the right to ask contractors for evidence that the work can be carried out to standard if the bid is more than 10% below the average.

The clause says: “In the event that… the employer still considers a tender price to be abnormally low, the employer reserves the right to discount that tender submission.”

Paul Dooley, director of estate regeneration at Poplar Harca, said that they decided to act after receiving several low bids, some of up to 20% lower than the average.

He said: “We feel that without a clause in the contract we could be subject to contractors making a challenge.”

Other housing associations are understood to be following in Poplar Harca footsteps.

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