Price fixing? Decent fees are the real problem, warns RIBA
UKarchitects could still escape a rap for being 'anti-competitive', after trade and industry secretary Stephen Byers concentrated on the other professions implicated by the Office of Fair Trading report instead last week and the RIBA and RIAS mounted more defences of the indicative fee guides for clients. But both the institute and incorporation stressed that, far from coining it through fixing prices, most architects are fighting hard for adequate fees, with decent margins still a rarity in the profession.
Byers was responding to the OFT report (AJ 8.3.01) which bundled architects in with lawyers and accountants as operating practices which it feels are anti-competitive. The architects' element in the report focused on the institute's indicative fee scales, but Byers, whose department has asked the RIBA to respond by Easter, fell short of citing architects as being under particular scrutiny in the House of Commons last week.
'And rightly so, ' said RIBA president Marco Goldschmied, who declared that the profession is 'very competitive', and in fact suffers from competitions 'of the wrong kind' where too many architects are invited to participate for no good reason. 'I assume that they agree and I have to assume that Byers feels that architects are competitive enough to not need a mention, ' he said. Goldschmied added that, in PFI situations, many practices are expected to work 'excessively' at risk and that the consumer was well represented through the ARB. Practices had every incentive to be competitive, given average salaries last year of £30,000 and hourly rates of £40 - a stark contrast with the other professions slammed by the OFT.
The DTI, however, said there was 'no sinister motive' behind Byers' silence, and all relevant parties will be consulted on changes - architects had not already escaped unscathed.
Institute director of practice Keith Snook said:
'We'll be staying firm, but I hope light, and we're going to coolly and calmly reiterate our point - it's guidance not for members but for clients and there's no question of it being recommended, it's simply indicative.'
Snook said he felt there may be a 'dying breed of practitioners out there who think that going back to mandatory fees would be a good thing', but that that would not be helpful in the light of the OFT report.
The institute is considering making the guidance more 'explicit' in order to make it more OFT compliant, but Snook said that would be 'counterproductive' since extra written information was not what clients wanted.
The RIAS said it too was 'puzzled' by the OFT, which had no evidence for its claim that the fee scale 'distorts price competition' or discourages efficiency. It said they were necessary for one-off and occasional clients, and that it is margins which are being 'entirely eroded' with creative time needed to deliver good buildings being 'squeezed out'.
The RIAS' own recent salary surveys showed average salaries of less than £30,000 and one in four earning less than £20,000. 'It's fiercely competitive out there, ' said RIAS secretary Sebastian Tombs.
'Most architects say to me, 'we're busy, but when are we going to earn a crust?''