BCIS Price Indices and COVID-19

BCIS publishes several groups of price indices for a variety of applications. The following is a brief description of the extent to which COVID-19 changes will be reflected in these series and how the price measurement will be affected.

BCIS Tender Price Indices

The BCIS All-in Tender Price Index will continue to measure the price level of tenders for building work reflecting changes in tender prices brought about by the COVID-19 pandemic.

BCIS is continuing to index projects for this index, but the flow of available schemes has slowed significantly. In March 2020 BCIS introduced an improved method for calculating the TPI where few projects are available, based on a simple econometric model. The historic relationships that this model relies upon will not hold during the economic shock caused by COVID-19. BCIS is therefore pausing the use of the model for quarters 1Q2020 onwards until further notice and will rely on the output from the BCIS TPI Panel to determine the TPI until such a time as sufficient projects are available for indexing or alternative approaches are available.

The sector indices will also be affected to the extent that many index figures will be missing and all will be less reliable than before.

BCIS Output Price Indices

As a result of the COVID-19 pandemic the BCIS Output Price Indices (OPI) will no longer accurately reflect the price of projects on site. BCIS are receiving fewer projects for indexing which reduces the reliability of the index. In addition, many projects will have extended construction periods meaning that their prices will be 'work on site' for longer than anticipated by the OPI calculation. BCIS recommends particular caution when using these indices from 1Q2020 onwards.

BCIS Regional Tender Price Indices

The BCIS Regional Tender Price Indices will continue to estimate the price level of tenders for building work in different parts of the UK reflecting changes in tender prices brought about by the COVID-19 pandemic.

As a result of the COVID-19 pandemic it is likely that the indices will be less responsive to regional changes than before because fewer projects are available to measure price levels. The underlying national trend will continue to reflect the BCIS All-in TPI which will temporarily be based on output from the BCIS TPI Panel.

BCIS Trade Price Indices

The BCIS Trade Price Indices will continue to attempt to measure the price level of trades in tenders for building work but the reduced number of projects available for indexing brought about by the COVID-19 pandemic means that index figures will be missing or less reliable than before.

Tender Price Indices (formerly BIS)

Extension of PUBSEC Tender Price Index of Public Sector Building Non-Housing

PUBSEC will continue the measure the price level of tenders for building work reflecting changes in tender prices brought about by the COVID-19 pandemic.

The index will continue to be calculated as a smoothed version of the BCIS All-in TPI. Due to reduced availability of projects for indexing, this index will rely on output from the BCIS TPI Panel from 1Q2020 onwards.

ROADCON Tender Price Index of Road Construction

ROADCON with continue to measure the price level of tenders for road construction projects reflecting changes in tender prices brought about by the COVID-19 pandemic as far as possible.

The anticipated reduction in the number of projects for indexing means that BCIS will increasingly rely on judgement to interpret the project indices that are available while the industry is affected by the COVID-19 pandemic.

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