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In a situation like this, where it's already been mandated that the job will be done goes a long way to taking away any incentive that the contractor might have

In a situation like this, where it's already been mandated that the job will be done goes a long way to taking away any incentive that the contractor might have to bargain. Only when there's a real possibility that the potential buyer might say "forget it, that's too rich for me" can a real negotiation occur. But as is it, the contractor has a distinct advantage. Of course, there are multiple contractors bidding. But they all know that the bid will be issued, and they know that they all know. With that knowledge, even absent real collusion, you can expect them to act accordingly. Pile on top of this the regulations dictating that it must be done with union labor at the prevailing wage; that ceilings must be of a given height and doorways recessed; etc. ad nauseam. This prevents the contractor from "thinking outside the box" to streamline the process with good ideas or better leverage their own skills. So we've got contractors that are hamstrung as to their approach to the project, but otherwise having the upper hand in negotiation. What do you expect to happen?

hugh3 16y ago
In a situation like this, where it's already been mandated that the job will be done goes a long way to taking away any incentive that the contractor might have to bargain. Only when there's a real possibility that the potential buyer might say "forget it, that's too rich for me" can a real negotiation occur. But as is it, the contractor has a distinct advantage. I thought the suggestion was that we hand a million dollars to the principal of each school and say "here, spend this on building and renovation". (Within certain limits, of course, and with some degree of oversight, to stop 'em from doing anything truly stupid.) Pile on top of this the regulations dictating that it must be done with union labor at the prevailing wage; that ceilings must be of a given height and doorways recessed; etc. ad nauseam. This prevents the contractor from "thinking outside the box" to streamline the process with good ideas or better leverage their own skills. afaik it would currently be totally illegal in Australia for the government to dictate that any labour had to be done by union members. The last government did a pretty good job of limiting union power and I don't think the new mob have managed to regress that far yet.
- brc 16y ago
  >afaik it would currently be totally illegal in Australia for the government to dictate that any labour had to be done by union members. The last government did a pretty good job of limiting union power and I don't think the new mob have managed to regress that far yet. The new government has actually reversed the laws back about 20 years and dismantled many of the anti-union safeguards, largely as a payback to the unions who funded the bulk of the advertising for the last election campaign. As a result, industrial action has increased by a large amount, and we're back to things like christmas strikes by postal workers and baggage handlers, and increasing amounts of violence in the construction industry. In this case, because the school construction all went to large construction companies, who all have unionised labour, it's a backhanded way of ensuring unionised labour does much of the work, though probably only in metropolitan areas. The rural construction is mostly sub-contracted out to local tradesmen.

hugh3 16y ago

In a situation like this, where it's already been mandated that the job will be done goes a long way to taking away any incentive that the contractor might have to bargain. Only when there's a real possibility that the potential buyer might say "forget it, that's too rich for me" can a real negotiation occur. But as is it, the contractor has a distinct advantage. I thought the suggestion was that we hand a million dollars to the principal of each school and say "here, spend this on building and renovation". (Within certain limits, of course, and with some degree of oversight, to stop 'em from doing anything truly stupid.) Pile on top of this the regulations dictating that it must be done with union labor at the prevailing wage; that ceilings must be of a given height and doorways recessed; etc. ad nauseam. This prevents the contractor from "thinking outside the box" to streamline the process with good ideas or better leverage their own skills. afaik it would currently be totally illegal in Australia for the government to dictate that any labour had to be done by union members. The last government did a pretty good job of limiting union power and I don't think the new mob have managed to regress that far yet.

brc 16y ago
>afaik it would currently be totally illegal in Australia for the government to dictate that any labour had to be done by union members. The last government did a pretty good job of limiting union power and I don't think the new mob have managed to regress that far yet. The new government has actually reversed the laws back about 20 years and dismantled many of the anti-union safeguards, largely as a payback to the unions who funded the bulk of the advertising for the last election campaign. As a result, industrial action has increased by a large amount, and we're back to things like christmas strikes by postal workers and baggage handlers, and increasing amounts of violence in the construction industry. In this case, because the school construction all went to large construction companies, who all have unionised labour, it's a backhanded way of ensuring unionised labour does much of the work, though probably only in metropolitan areas. The rural construction is mostly sub-contracted out to local tradesmen.