Estimates for rebuild work 'too low'

10:39 pm on 15 July 2013

Christchurch building and decorating firms say residential earthquake repair work has dried up because they are being expected to take less money than the jobs actually cost.

The owner of a Canterbury quantity surveying business says project managing organisations such as Fletchers Earthquake Repair are estimating the cost of work extremely low and contractors are turning it down because they don't want to lose money.

Lester Bryant says he knows of cases where the disparity has been up to 600%.

"There is no appetite among tradesmen to accept these rate any more and that's possibly where the bottle neck's occurred because the PMOs can't release the work because they can't find trades people that will actually accept those rates."

Mr Bryant says large construction companies have taken on the role of project manager for insurers and lack the necessary cost estimating skills for residential repair work. He says he has had to lay off staff who were initially hired to cope with the projected increase in work.

Radio New Zealand has spoken to several other companies in similar situations that did not want to be named for fear of losing the work they do have.

But a Christchurch construction firm says businesses who are complaining about losing money on quake repair jobs should work more closely with their project managers.

Falcon Construction director David Reid says the disparities are probably a misunderstanding. Mr Reid says Falcon works with a price book that ensures the project manager and builder base the cost of their repairs on the same figures. He says they also negotiate costs on site.

The Earthquake Commission's home repair programme manager Reid Stiven told Radio New Zealand's Nine to Noon programme on Monday that project managers' and contractors' cost estimates are not drastically different.