Abstract:
An attempt has been made in this study to assess the effectiveness of employer’s financial security in construction contract administration with focus on Lagos state, Nigeria. Thus the project aims at evaluating the effectiveness of employer’s financial security with a view to recommending measures through which it can be made more effective or improved upon in the Nigerian construction industry. Some past works on the topic for the research study were reviewed to measure the extent of the respective work. Field survey was carried out to identify and assess the effectiveness of the major instruments in providing employer’s financial security in construction projects, determine those factors that impact on the effectiveness of the instruments used by employers in the industry; and establish the strategies for improving the effectiveness of employer’s financial security. The results obtained were analyzed and discussed. Data were analyzed using Statistical Package for Social Sciences (SPSS 17.0), presentation were fully discussed; based on the analysis; it was discovered that the most effective instrument is cash retention and the study concludes that the top five commonly used instruments for employer’s financial security in construction contract administration in Lagos state are: performance bond; cash retention; contingency plan; advance payment bond; and bank guarantee. Also, that effectiveness of the instruments used by employers for financial security can be influenced by certain factors which include but are not limited to government policy, misappropriation of project funds, poor project management, terms of the policy, poorly drafted insurance policy, timing/time frame, contractor’s default, choice of instrument and delay in construction /procurement period. The study also establishes a range of strategies for improving on effectiveness of employer’s financial security. It is however recommended that effective monitoring process and efficient project management plan are put in place by engaging competent professionals on timely project delivery.
