With concerns raised that the price of crushed rock aggregates and concrete in Guernsey is much higher than in the UK or France, the GCRA has been asked to look into it to find out why.
Pre-investigation work, already carried out by the Guernsey Competition Regulatory Authority, found that Guernsey manufactured concrete is “consistently more expensive than the equivalent products manufactured in the UK – with local prices being twice as high in all but one case”.
The Committee for Economic Development said this needed looking into further, with the GCRA asked to conduct a ‘market study’ which is now underway.
ED said the construction sector plays a critical role in Guernsey’s economy, but with costs of materials getting so expensive, residents are being directly impacted by the cost and feasibility of building in the island.
Crushed rock aggregates produced at the Ronez quarries are supplied direct to the local construction industry, as well as forming the basis for an extensive range of construction products including ready mixed concrete, asphalt and concrete products.
Deputy Neil Inder, President of the Committee for Economic Development, said it shouldn’t cost so much more than elsewhere.
“A formal request for a Market Study from the Committee will enable the GCRA to use its statutory powers to request detailed cost and price information from concrete and aggregate suppliers. With the development of housing being a key priority of the States, the prices of input products such as concrete and aggregates, directly impact the cost of house building.
“Following concerns over the prices of these products raised by the sector, the Committee has asked the GCRA to undertake this Study.”
ED has previously said the building industry generates approximately 4.5% of the island’s gross value added (GVA) while also contributing materially to the community’s quality of life with the construction of public amenities such as schools, hospital and housing.
In economics, gross value added (GVA) is the measure of the value of goods and services produced in an area, industry or sector of an economy. It is a measure of the contribution towards gross domestic product (GDP) made by an individual producer, industry or sector.
The Committee for Economic Development said “evidence suggests market studies promote better market outcomes”.
Guernsey’s Competition Law does have a provision for the GCRA to carry out such studies, but “only on the direction of the Committee”.