News in 2017
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Financing desperately-needed buildings and infrastructure including energy systems, railways, bridges, schools and hospitals can often be risky because infrastructure projects across the globe categorise and forecast the construction costs differently. Until now, it has been almost impossible for governments and investors to compare construction costs. It is hard for them to know if public infrastructure projects are good value and this can waste taxpayer money.
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Tackling these problems head on, a group of influential sector players got together and formed the International Construction Measurement Standards (ICMS) Coalition during a meeting at the International Monetary Fund in June 2015. ICMS is a growing group of more than 40 professional and not-for-profit organisations from around the world including FIG, working together to develop and implement international standards for benchmarking, measuring and reporting construction project cost. |
On 25 July 2017 the standard was successfully launched as part of the PAQS 2017 Congress in Vancouver, Canada.
The new ICMS standard enables, for the first time, better comparison in order to improve investor confidence and attract more private sector funding.
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See Lian Ong, Chair of FIG Commission 10 (Construction Economics and Management) is FIG representative in the coalition and was elected Chair of the ICMS Standards Setting Committee. He explains: “We are delighted to launch this new standard. With increasing levels of public private, cross-border financing and construction investment funds underpinning our pension schemes, it is vital to make sure costs can be assessed in a transparent way. The ICMS framework will improve ways of working and this collaborative project is an example of the global construction profession uniting to improve ways of working for the public interest. “ |
The new standard harmonises cost, classification and benchmarking definitions to enhance comparability and consistency of capital projects. A report by McKinsey Global Institute, ‘Reinventing Construction: A route to higher productivity’ (Feb 2017), finds that the International Construction Measurement Standard ‘will help clarify the costs of projects.’
Different approaches to presenting construction costs can lead to inconsistent methodology which causes significant variations and spurious cost comparisons. In some countries, there are no standards at all creating barriers to FDI. The ICMS Coalition believes that financially constrained governments should be able to better understand information to make the right construction investment decisions and attract more private funding to help improve return on investment.
30 August 2017
