Development of cost benefit analysis model of accident prevention on construction projects

Abstract

The Health and Safety Executive estimated the annual cost to British employers and other duty holders failing to comply with health and safety requirements to be up to £18 billion. It is estimated that the construction industry contributed £2billion of these appalling statistics. To date, health and safety management is still perceived as being costly and counterproductive in the construction industry. This research investigated the net benefit of accident prevention and explored the relationship between preventative costs and these benefits, with a view to drawing attention to the economic consequences of effective/ineffective management of health and safety by contractors in the UK construction industry. The need to investigate the cost of accident prevention in relation to overall benefits of accident prevention is therefore deemed necessary. A quantitative research methodology was employed in investigating these costs and benefits within the UK construction industry. From the ratio analysis small contractors spend relatively higher proportions of their turnover in total on accident prevention than medium and large contractors, and medium contractors spend a higher proportion of their turnover in total on accident prevention than large contractors. The results also show that medium and small contractors gain relatively higher proportions of their turnover in total as benefits of accident prevention than large contractors. The benefits of accident prevention far outweigh the costs of accident prevention by a ratio approximately 3:1. The relationships between these costs and benefits were examined. The costs of accident prevention were found to be positively and significantly (P < 0.005) associated with benefits of accident prevention. These associations were modelled using simple linear regression, and from these models it can be inferred from the results that the more contractors spend on accident prevention the more they derive benefits of accident prevention, which would improve health and safety performance on construction sites. ii The developed model was subsequently validated using experts and practitioners opinion from the UK construction industry. This developed model should provide good guidance to assist contractors in developing effective and efficient health and safety management for UK construction industry.