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Owen Pugh boss blames 'bullies' for collapse

owen pugh

The boss of collapsed Owen Pugh Group has blamed the firm’s closure on ”bullying tactics” used in the construction industry.

Last week administrators were called in and 257 staff at the Dudley-based firm were made redundant, including staff for the group’s civil engineering arm. Owen Pugh Aggregates, which runs Marsden Quarry near Sunderland, is the only branch of the group continuing to operate while a buyer is sought.

Former chair of the group John Dickson, who lost his home as a result of the company’s financial problems, told the Newcastle Evening Chronicle that ”bullying tactics” from some main contractors and bad luck were to blame.

“I’ve gone through three years of absolute hell trying to keep the business going and I’ve done everything I possibly could to make things work but it’s not been enough. We’ve had the most extraordinary bad luck and this is a particularly tough industry at a particularly tough time,” he told the paper.

“I have to say that some of the companies we’ve worked for have shown a complete lack of moral scruples. Some of the main contractors are often just bullies.

“In most industries you will put in an invoice for your work and expect to be paid for 95% of it; we were sometimes getting 10 or 15%. The law allows companies to do that and there’s no incentive to behave properly. We could go to adjudication, but it would cost us £50,000 before it even started and all we’d get back is the original sum. There’s no penalty for the bad behaviour.

“This doesn’t happen in other countries and it doesn’t happen in other industries. It’s a thing that happens in construction.”

Nine employees remain working at the group’s head office to help administrators. The company was founded in 1946 as a specialist in construction plant hire before branching out into wider construction and engineering work.

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Readers' comments (2)

  • Mr Dickson is absolutely correct. This industry is riven with bullies, and not just main contractors but clients too, often advised or egged on by professional project management firms. It is a macho industry where ethics and moral standards are stretched beyond limits; some players are immoral. It would be a lazy response to say “well that’s the way it is, so just get on and deal with it” but that is in itself immoral. There is real human suffering from stress to destitution caused by such tactics as well as poor delivery of some engineering projects.

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  • The problem for sub-contractors, in part, stems from main contractor site staff desperate to make a name for themselves. Main contractor margins are in themselves low and a philosophy of profit at all cost, and by any means, prevails. It is often the case that those with less experience (or common sense) find that under certifying for the works carried out by the sub-contractors is the easiest way to profitability. Fighting for proper reimbursement is both time consuming and costly for sub-contractors and rarely results in a net profit gain. Attitudes have to change.

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