March 18, 2019
Focusing on delivery and implementation
As I write this editorial we are facing the UK’s imminent exit from the EU and the aftermath of the collapse of UK contractor Carillion last year and the tragic fire at London’s Grenfell Tower in 2017. These events are all affecting the UK construction sector and especially its attitude to procurement.
One of the key themes highlighted is the need for collaboration across the industry, a theme which is supported in the UK government’s Transforming Infrastructure Performance programme and Project 13, an industry-led initiative to improve delivery of infrastructure.
The events have refocused our procurement processes on obtaining best value (rather than lowest cost) and constructing buildings and infrastructure taking into consideration usage and whole-life costs.
It is vital to establish collaborative partnerships or alliances between clients, contractors and supply chains. As NEC users well know, this requires those responsible for the design and technical details to work closely with those responsible for commercial negotiations during the early stages of a project.
The need for collaboration was further highlighted in Judith Hackitt’s report (2018) following the Grenfell Tower fire, the recommendations of which have been accepted by the government.
The report reflected that improved procurement processes were part of setting the tone for construction projects. Procurement kick-starts behaviours subsequently seen throughout design, construction, occupation and maintenance. The agreements made determine the relationship between people commissioning buildings, people constructing them and people occupying them.
While the UK’s exit from the EU is potentially challenging, it is critical to get on with procuring the infrastructure the country needs. On 26 November 2018 the government published its latest construction pipeline (IPA, 2018), which revealed the vast scale of public and private investment underway and expected over the next 10 years, providing assurance to industry.
The pipeline includes the largest ever investment in the UK’s strategic road network and substantial investments in railways and schools. To ensure maximum efficiency inbuilding these projects, greater use of modern methods of construction is being encouraged.
Many projects in the pipeline are complex and offer significant opportunities for modern methods. Where appropriate the NEC3 and NEC4 suites of standard contracts will be used for procurement. Standardising the use of these comprehensive suites of contracts will help to deliver efficiencies across the public sector and promote behaviours in line with the principles of the government’s construction strategy (IPA, 2016).
There are also a number of government programmes and strategies now in place to support the construction sector and drive improvement. The latest, which is a first for construction, is the launch of the new Core Innovation Hub in December 2018 to support development and use of technologies such as digital design and advanced manufacturing. The Construction Leadership Council (CLC), which brings together leaders from across the construction sector to work with government, is moving its focus to delivering implementation of the Construction Sector Deal (a partnership between government and industry to transform the sector’s productivity) and the Core Innovation Hub.
Furthermore, the initial £13 million tranche of the Industrial Strategy Challenge Fund has been allocated. Recipients include established construction companies such as Balfour Beatty, Skanska, Kier, Barratt Homes, Land Securities, Tarmac and Keltbray as well as start-ups and universities.
Part of the CLC’s and governments’ work will be around transforming the business model to make it more sustainable, and standardising approaches to the design and procurement of construction projects to deliver better whole-life value and project performance.
Rising to the challenge
While 2019 will be a challenging year on many fronts, NEC users committed to changing ways of working to deliver better outcomes for all those involved in construction can look forward to the future with confidence.
Hackitt J (2018) Building a Safer Future: Independent Review of Building Regulations and Fire Safety, Final Report, Cm 9607, available at: gov.uk (accessed 01 February 2019).
IPA (Infrastructure and Projects Authority) (2016) Government Construction Strategy 2016-20, available at: gov.uk (accessed 01 February 2019).
IPA (2018) National Infrastructure and Construction Pipeline, available at: gov.uk (accessed 01 February 2019).
POSTED BY NEC Contracts