88% of projects hit by problems with utilities

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The problem of getting a site connected to a gas, electricity or water supply has grown even worse in the past two years, according to a survey from the National Federation of Builders.

In 2006, work on 86% of sites was delayed by utility connections. This year the figure was 88%, and many of the 352 firms surveyed suffered delays and financial losses as a result.

Despite their soaring profits, electricity companies remained the worst offenders. Sixty-six per cent of respondents said their projects had been delayed by a failure to connect to the National Grid, compared with 64% two years ago.

Sixty-three per cent said this had led to delays, and a third of firms suffered financial loss as a result. One firm estimated that delays in obtaining connections, mainly for electricity, had cost his firm £100,000 a year in penalties and extra staff costs.

About half of sites were affected by the late delivery of gas and water. A quarter of firms suffered financial loss as a result of their water connection and a fifth were hit by delays in the supply of gas.

Julia Evans, the chief executive of the NFB, said the survey reflected the “staggering arrogance” of utility companies.

“The extent of their apathy towards better communications with an important sector of UK industry is laid bare by this survey,” she said.

Contractors pay thousands up front for a connection that is then delayed
Julia Evans, NFB

“The economy is handing the construction industry its toughest challenge for decades. The last thing contractors need is to pay thousands of pounds up front for a connection that is then delayed by the poor performance of a utility company. Especially when they are raking in rising profits of up to 35%.”

The main frustration for contractors was in finding the right person to talk to at the utility company. They also complained that calls were not answered and messages were unreturned for days.

Firms said the process would be improved by single points of responsibility and service level agreements with penalties for missing targets.

Firms also cited the lack of competition in the energy and water sectors. Forty-one per cent of companies said there should be a greater choice of supplier, compared with 35% in 2006.

“We had believed we were making progress,” she said, “but the views of contractors have prompted us to get even tougher.”