While none of the companies fined were Scottish and none of the construction projects were undertaken north of the border, many of the firms -- such as Kier Group, Galliford Try, Balfour Beatty, John Sisk & Son and Carillion - are well-known names across Scotland.

The OFT said it had fined the firms for engaging in “illegal, anti-competitive, bid-rigging activities on 199 tenders from 2000 to 2006” in the public and private sectors.

The hefty £129.5m in penalties, which are the result of the widest ever OFT probe in terms of companies involved, also mark the latest blow to the recession-hit construction industry, which has suffered badly in the housing slump.

Nonetheless, the watchdog said it believed the companies, which include several listed on the London Stock Exchange, had artificially inflated the bill for more than £200m worth of public sector building work in England.

A spokeswoman for the OFT told The Herald: “There was certainly no activity north of the border. The investigation began in 2004 after a complaint from an NHS auditor in Nottingham relating to the Queens Medical Centre, and it all unravelled from there, mostly across the north of England, but elsewhere in England also.”

The illegal activity was mostly in the form of cover pricing, where bidders got rivals to submit artificially high prices. Such bids were not priced to win a contract and gave a misleading impression about the extent of competition.

In some cases, the unsuccessful bidder was paid an agreed sum of money by the winner, the OFT said.

“This decision sends a strong message that anti-competitive and illegal practices, including cover pricing, must cease,” said Simon Williams, the OFT’s senior director for the case.

The OFT added: “Whether or not all bidders were involved in collusion, and whether or not the winning bid came from a colluding party, in all cases competition was distorted.”

The largest single fine was the £17.9m penalty imposed on Kier Group for its involvement in three projects, including a £1.6m contract to construct a new primary school in Peterborough, Cambridgeshire, where the OFT said “two out of five bidders (were) engaged in cover pricing, (and) two other invited bidders did not tender”.

Galliford Try, Uxbridge, Middlesex-based building firm which operates in Scotland under the Morrisons brand, was fined £8.3m. Balfour Beatty was fined £5.2m and Carillion was fined £5.38m.

Dublin-based John Sisk & Son, which is involved in the construction of 198-bedroom hotel next to the landmark Theatre Royal in Glasgow city centre, was fined £6.2m.

Meanwhile, shares in Kier Group yesterday tumbled 2.2% to £12.65, Galliford Try fell 0.8% to 61.5p, and Balfour Beatty shed 0.9% to 337p.

The OFT said last April that 112 companies had colluded in this way. Today, it said it had dropped charges against nine of these firms because of insufficient evidence. Firms that co-operated with the OFT investigation also saw their fines cut by up to 65%.

Balfour Beatty said in a statement that its fine related to a subsidiary, Mansell, for actions taken before it was acquired. It secured a 50% reduction in its fine by co-operating with the OFT.

By contrast, construction giant Morgan Sindall yesterday proved to be one the biggest surprises on the stock market.

The company, which was fined £286,593 after a 45% leniency deduction because its co-operation with the OFT’s investigation into subsidiary Morgan Ashurst, said it had carried out a “comprehensive review of the group’s approach” since the probe was launched, and that it had now “strengthened its policies and procedures in this area”.

Morgan Sindall’s shares yesterday climbed 1.2%, or 8p, to 680p. The OFT said it had uncovered evidence of cover pricing in more than 4000 tenders involving more than 1000 companies.