Ten construction firms “illegally colluded to rig bids for demolition and asbestos removal contracts”, an investigation has found – including on a major Reading project.

The Competition and Markets Authority (CMA) has provisionally found that the firms colluded on prices through illegal cartel agreements when submitting bids in competitive tenders for contracts.

These bids were "rigged with the deliberate intention of deceiving the customer that they were competitive" - when that was not the case.

The bids were reportedly rigged by one or more construction firms which agreed to submit bids that were deliberately priced to lose the tender.

This practice, known as ‘cover bidding’, can result in customers paying higher prices or receiving lower quality services.

Eight of the firms have admitted their involvement in at least one instance of bid rigging between January 2013 and June 2018: Brown and Mason, Cantillon, Clifford Devlin, DSM, J F Hunt, Keltbray, McGee, and Scudder.

Two other firms, Erith and Squibb, have not admitted their involvement in any bid rigging and the CMA said it “should not be assumed that they have broken the law”.

The collusion affected 19 contracts for demolition work, including Station Hill in Reading, an underground car park in High Wycombe, Oxford University, the Metropolitan Police training centre, Selfridges and offices on the Southbank in London.

Station Hill is a £750 million redevelopment project in the centre of reading, with two acres of new public space accommodating retail areas, restaurants and food halls, as well as community and leisure facilities.

The CMA is planning to fine the businesses concerned if it reaches a final decision confirming that they have broken the law.

In addition, the CMA has provisionally found that seven of the firms, on at least one occasion each, were involved in arrangements by which the designated ‘losers’ of the contracts were set to be compensated by the winner.

The value of the compensation varied - but was higher than £500,000 on one occasion.

Some firms also produced false invoices in an attempt to hide this part of the illegal behaviour.

Michael Grenfell, the CMA’s Executive Director for Enforcement, said: “The construction sector is hugely important to Britain’s economic well-being. Bid rigging can result in worse deals, which can leave businesses – and sometimes taxpayers – out of pocket.

“This is unacceptable, and the CMA won’t hesitate to come down hard on these activities and impose appropriate fines.”