Based on an improved sample, the BCIS Tender Price Index remained unchanged in 1 st quarter 2003 compared with the previous quarter, but rose by 5.5% compared with 1 st quarter 2002.

In 2003, new work output is expected to rise a lot faster than its long term trend rate of 2.0% per annum, rising a little behind trend over each of the following two years. The key sectors contributing to growth over the next two years are likely to be the public non housing and infrastructure sectors, but the forecast is based on the expeditious release of public funding, and the Chancellor standing by his commitment to expenditure on construction over the next few years.

It is anticipated that tender prices will increase well above the rate of inflation over each year of the forecast on the back of the aforementioned rising new work output, and due to pressure from input cost rises. Over this period, general inflation should remain between 2.5% and 3.0%. The BCIS forecast is for tender prices to rise by 6.6% between 2nd quarter 2003 and the same quarter in 2004, and by 4.8% the year after.

Tender Prices Rise