When the head of construction at John Lewis says competitive tendering gets projects done for 10% less than partnering, it鈥檚 clear the paradigm has shifted
Liam Fox took the opportunity afforded by the Farnborough air show on Tuesday to tell the representatives of the armaments industry that either they cut their prices or he鈥檇 cut their projects. The next day, the National Audit Office told Fox鈥檚 Ministry of Defence that it could no longer 鈥渓ive beyond its means鈥 (which is very much the phrase of the moment).
Meanwhile, closer to home, Paul Morrell, the chief construction adviser, told the industry, its clients, and its Biggest Client of All, that they had to put in place basic measures to improve efficiency (page 12).
Well, one likeable thing about the defence sector is that its procurement record makes everyone else look like Harvard Business School graduates, magna cum laude. But of course Morrell is right: the state may not be shutting up shop, but its spending departments will certainly be favouring those companies that can build things for the money they have available.
One of his targets is, as ever, red tape: if we could simplify the prequalification process, this would cut costs and disproportionately benefit smaller companies with fewer management resources.
Another idea is to produce buildings of 鈥済ood enough quality鈥 to serve their purpose, with an emphasis on standardisation and with that, large-scale offsite construction. If you鈥檝e been taught in a leaky Nissan hut, the chance of having a desk in a shiny classroom in a brick-clad, pitched-roof box is pretty attractive, even if your new learning space won鈥檛 be winning any Stirling prizes (at least not this year - see the shortlist on page 10). On the other hand, standardisation can be good or bad. We may have to cut our cloth differently, but what a terrible shame it would be to take all public architecture back to the 鈥渄esign and build鈥 days of the early PFI. And we certainly need a sensible, informed arbiter of what is acceptable and fit for purpose - so Morrell鈥檚 call to keep delivery agencies is a welcome one.
One other obvious ways of trying to increase value for money is to put higher value work out to competitive tender, as the MoD is proposing to do (page 13). Well, you鈥檇 expect aggression from the armed forces, but when the head of construction at John Lewis says competitive tendering gets projects done for 10% less than partnering or negotiated work, it鈥檚 clear the paradigm has shifted. Incidently, Tony Jacobs made those remarks at 好色先生TV鈥檚 supermarkets conference last week (see building.co.uk), and he added that he didn鈥檛 just take the lowest bid, and that as costs were on a downward trend he was looking to see 鈥渉ow sustainable some of these low costs are鈥. That is reassuring. Partnering may be out of fashion, but clients shouldn鈥檛 mistake a fair and sustainable price that won鈥檛 lead to problems down the line as 鈥渓iving beyond their means鈥. It鈥檚 the exact opposite.
Small change, big difference
The latest report from the Zero Carbon Hub is a thoughtful piece of work (page 22). Oh sure, it may sound dull - the shortcomings of the standard assessment procedure in determining compliance with Part L of the 好色先生TV Regulations is never going to be that sexy. But this report is important for two reasons. First, it indicates how SAP needs to develop to meet the zero carbon agenda (the performance of our future homes will only be as good as the performance of the program that measures it). Second, the Hub has shown it can come up with strategic solutions acceptable to housebuilders and the government. So it is perhaps a bit myopic of the latter to threaten the withdrawal of state funding (a paltry 拢750,000 last year) once the definition of zero carbon has been finalised. Achieving that goal requires thinking through the scientific framework and then painstakingly filling in its technical details, and this report is a good example of that. Surely that鈥檚 worth a few coppers from the government鈥檚 small change jar?
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