APPRAISAL OF LABOUR-ONLY CONTRACT FOR CONSTRUCTION PROJECT DELIVERY IN ABUJA, NIGERIA

Abstract

Construction projects are carried out through diverse procurement methods, one of which is the labour-only procurement system which is fast gaining popularity among construction clients who are ready to make savings by procuring materials themselves, leaving the contractor/subcontractor to provide only the labour needed. This research therefore appraises labour-only procurement for construction project delivery in Abuja, Nigeria using a mixed design approach. The population for the study comprises of 42 client / construction professionals and 56 contractors/subcontractors (registered with the Real Estate Developers Association of Nigeria) that have been involved in the labour-only contract. These respondents were identified through snowballing and data were collected through the use of structured questionnaire and interview. Data gathered were analyzed using frequency, percentage, mean item score, ANOVA, Mann Whitney U-Test, and Constant Comparative Analysis. Paired-samples t-test was further used to analyze cost and time data gathered to ascertain the performance of the system in terms of cost and time. The study revealed that the major types of building construction suitable for the use of labour-onlycontractareresidential buildings and minor alteration or modification while it proved that it is not good for large construction projects. The study concluded that the major factors responsible for the use of labour-only contract are; client’s decision to procure materials, the need to minimize cost of construction, the knowledge of the quantity or nature of work, the need to continually have job at hand and the need for referral so as to get other jobs in the future. It was also discovered that stakeholders view the labour-only contract as a procurement system appropriate for procuring construction projects and are willing to use it for subsequent construction works, as it gives numerous advantages such as; cost savings for the client, reduction of contractor’s overhead and discouraging short-changing of specifications and standard by contractors. However, the major disadvantages of the use of labour-only contract include; the need for time commitment, energy and diplomacy, reduction in contractor’s profit and its limitation to only small construction companies/firms. In conclusion, the use of labour-only contract in terms of cost will provide adequate savings for the client with a minimal occurrence of time overrun. The study further recommends that the use of this system should be encouraged among construction participants as it is truly a beneficial procurement system.