A conceptual model for pricing health & safety on construction projects

Abstract: The competitive nature of the construction industry (CI) has marginalised health and safety (H&S) on construction projects. Most clients in the CI, if not all, award projects based on price and in most cases to the “cheapest bidder” and not the “safer bidder”. Consequently, such practices have compelled contractors to lower their bid price to increase their chances of being awarded projects, whereas in contrast, H&S is marginalised. The study, which was a case study of nine projects of which six were civil engineering projects and three building construction projects, was purposed to conceptualise a model for pricing H&S on construction projects. The findings showed that contractors do price for H&S using an itemised breakdown even though such items are not included as a trade in the Bill of Quantities (BOQs). With regards to expenditure, the actual costs of H&S ranged between 2.9% and 3.98% for projects with a value below R500 million and between 4.08% and 4.90% for projects with a value above R500 million. Health and safety costs were found to be directly proportional to the projects value and indirectly influenced by the client. Previous studies recommended that H&S should be priced as an itemised trade in the BOQs, but such recommendations are yet to be implemented. The lack of a conceptual model for pricing H&S on construction makes accurate and adequate monitoring of H&S costs unlikely. Thus, a standardised pricing model will assist contractors to price adequately for H&S, and clients, to ensure that provision for H&S measures on construction projects is adequate as required by the Construction Regulations (CR) 2014