NEC helps to deliver nearly £200 million of UK field hospitals in record time

NEC contracts have been used to deliver most of the UK’s temporary field hospitals during the Covid-19 pandemic. Costing nearly £200 million, the hospitals were each built in a few weeks within existing events and sports centres between March and June 2020.

Five of NHS England’s seven Nightingale hospitals were delivered through the NHS Procure 22 framework using NEC3 Engineering and Construction Contract (ECC) Option C (target contract with activity schedule). These were at Birmingham (£58 million), Manchester (£10.3 million), Harrogate (£18 million), Bristol (£5.4 million) and Exeter (£12 million). NEC3 ECC Option C was also used for the £6 million Nightingale Hospital North East in Washington.

NHS Scotland’s £43 million Louisa Jordan Hospital in Glasgow was procured using NEC3 ECC Option E (cost reimbursable contract) through Frameworks Scotland 2, while Cardiff and Vale University Health Board used NEC4 ECC Option E for the £8 million Dragon’s Heart Hospital in Cardiff. NEC3 ECC Option E was also used for at least three of the other 18 field hospitals in Wales, on which the government spent an average of over £8 million each.

Jersey’s Health and Community Services also used NEC3 ECC Option E for the £14 million States of Jersey Nightingale Hospital in St Hellier.

Strategic benefits

According to Andrew Gate, the NHS Estates Delivery Team regional delivery director responsible for the NHS Nightingale Hospital Yorkshire and the Humber in Harrogate, says there were strategic benefits to using NEC3 ECC Option C.

‘As well as being a well-understood form of contract, there was an appropriate risk share between the parties. This enabled the Leeds Teaching Hospitals NHS Trust and principal supply chain partner Bam to get on with delivery. The timing was absolutely critical and delivery was running 24/7.

‘The target cost also meant we had full control on spend. Overall NEC’s required collaborative approach between the contractor, their subcontractors and the client team was very effective.’ A total of 500 additional critical care beds were created in the Harrogate Convention Centre in just 3 weeks.

NEC project manager Julie Hirlam of Arcadis says, ‘NEC brought benefits to the entire team at Harrogate, including a genuine partnering and collaborative team approach on shared goals, fair reward and transparent working. There was an open, honest and transparent team structure with clear accountability, and a clear understanding of the target cost at the project outset.’

Swifter payments

Hirlam says the standard Procure 22 ECC Option C contract was amended to take away the pain/gain mechanism to reflect the fact that the target cost was considered a ‘provisional amount’ given the timescales involved and need for flexibility. The government’s Covid-19 Public Procurement Notices PPN01/20 and PPN02/20 were also built into the contract to enable swifter payments and more relaxed competitive procurement conditions on the supply chain.

‘NEC’s flexibility allowed all this without major changes to the standard terms. Using ECC Option C ensured actual costs were charged, meaning the client was not exposed to a fixed priced with no route to a saving when the final cost came in. This gave the contractor confidence it would recover its project costs, reducing any commercial tensions.’

In total NEC-procured field hospitals provided an initial capacity of nearly 5000 extra critical care beds, enabling the UK to cope with any surges in demand caused by the ongoing Covid-19 pandemic.