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Published: 13/03/2025
Civil engineering tender prices increased by an average of 1% in the first quarter of 2025, according to a panel newly established by the Building Cost Information Service (BCIS).
The BCIS Civil Engineering TPI panel has been formed to advise on the latest movement in tender prices, i.e. prices agreed between client and constructor at commit to construct, and to inform quarterly updates to the BCIS Civil Engineering Tender Price Index.
Comprised of cost consultants from firms involved in multiple civil engineering tenders in the UK, the panel will also provide commentary on conditions affecting pricing levels on civil engineering projects.
At its second meeting, the panel also agreed a 3% average increase in civil engineering tender prices in the year to 1Q2025.
Dr David Crosthwaite, BCIS Chief Economist, said: ‘Like in other sectors, civil engineering clients are waiting to see what happens with the second phase of the government’s spending review, due in June. Until then, there continues to be uncertainty in the market.
‘Panellists said that, although there is positive sentiment in the sector, the point at which that is expected to convert to activity keeps moving back. Whereas there was an expectation at the end of last year that output would increase from the beginning of the year, they’re now talking about the latter half of this year at the earliest.’
Contractors’ appetite to tender for civil engineering projects was reported as fairly flat and generally getting easier, though some sub-sectors are busy with constrained supply chains.
Dr Crosthwaite added: ‘Water, sewerage and electricity generation spending are expected to kick in later this year, so we’ll see increased pressure in those areas. Panellists also reported that they are starting to see some price rises feeding through following the announced changes to employers National Insurance contributions.’
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