The chief executive of the Olympic Delivery Authority has revealed the body is carrying out credit checks on its suppliers in the wake of the deepening financial crisis.
In an exclusive interview with 好色先生TV, David Higgins said: 鈥淪ubcontractors are obviously a concern. We do our own credit checks to make sure we鈥檙e not too exposed to companies.
鈥淲e haven鈥檛 introduced new criteria, but we are monitoring our exposure to individual contractors very closely.鈥�
His comments follow consultant Pricewaterhouse Coopers鈥� recent revelation that the number of construction companies falling into insolvency has risen 35% since this time last year.
Higgins said small companies were the main concern. 鈥淭he biggest UK contractors are well positioned because they鈥檝e got good forward workloads and the suppliers market has some very big, well-capitalised companies.鈥�
We are monitoring our exposure to individual contractors very closely
David Higgins
He added, however, that one positive had emerged from the downturn: 鈥淪ubcontractors are more competitive. There鈥檚 a lot more interest now, and we鈥檙e getting a good response from tendering. Eighteen months or two years ago, it was much harder to get people to tender.鈥�
Jonathan Hook, construction and housebuilding leader at PwC, said the ODA was being 鈥渟ensible鈥� in issuing credit checks but warned that it could leave firms already suffering from financial difficulties struggling to get work.
鈥� Internal auditors have been brought in by main groundwork contractor Nuttall to investigate union allegations of unfair employment practices on the Olympic site. An ODA spokesperson said: 鈥淭o date no evidence to support the allegations has been found.鈥�
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