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Red tape removal service Constructionline sold to “free it from government ownership”

2 min read

28 January 2015

Former editor

Business process management firm Capita has snapped up the government founded and owned organisation Constructionline for a fee of £35m.

Set up in 1998 by the predecessor to the Department for Business Innovation & Skills to “relieve the pre-qualification burden on the construction industry”, Constructionline was actually previously operated by Capita as part of a concession agreement.

As part of its services, Constructionline provides a verified list of suppliers that have already passed industry checks. It levies yearly fees on the supplier firms for the pre-qualification service provided and currently has 23,000 suppliers.

Commenting on the sale, business minister Matthew Hancock said: “Construction benefits from the quality-assured, time-saving service of Constructionline and this sale aims to cut red tape further by freeing it of government ownership.

“Commercial ownership will enable the business, which has built up a strong reputation for reducing duplication and tender costs within the sector since its establishment in 1998, to achieve its full potential.”

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Acquiring firm Capita is a global business with 64,000 staff. The company, which is listed on the London Stock Exchange, works across markets including central and local government, education, transport, health and insurance. As part of its previous concession agreement with the government, it already had 99 staff working at the Constructionline Basingstoke and Edinburgh offices.

Capita’s bid for Constructionline was said by the government to meet its objective of “ensuring a safe and efficient continuation of a service” to existing customers as well as being the “highest price” for the business.

“Capita now has an exciting opportunity to expand its valued services to meet the needs of the construction industry and especially small and medium-sized businesses,” Hancock added.

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