government construction strategy

8/6/2019 Government Construction Strategy

1/43

GovernmentConstruction

Strategy


2/43

CONTENTS

Executive Summary.. 03

Chapter 1 Introduction...... 05

Chapter 2 Strategy Objectives. 08

Annex A Summary Action Plan. 19


3/43

Executive Summary

The Governments Plan for Growth, published alongside Budget 2011, highlighted the critical

importance of an efficient construction industry to the UK economy. The construction sector is a

major part of the UK economy. It represents some 7% of GDP or 110bn per annum of

expenditure - some 40% of this being in the public sector, with central Government being the

industrys biggest customer.

There is widespread acknowledgement across Government and within industry backed by

recent studies that the UK does not get full value from public sector construction; and that it

has failed to exploit the potential for public procurement of construction and infrastructure

projects to drive growth.

This strategy changes that. It calls for a profound change in the relationship between public

authorities and the construction industry to ensure the Government consistently gets a gooddeal and the country gets the social and economic infrastructure it needs for the long-term.

There is a detailed programme of measures Government will take that will reduce costs by up to

20% by the end of this parliament. To help industry work with us on this we will publish from

autumn 2011 a rolling two year forward programme of infrastructure and construction projects

on a quarterly basis where public funding has been agreed.

This strategy means that the public sector will become a better client more informed and better


4/43

Executive Summary

there is an alignment of interest between those who design and construct a facility andthose who subsequently occupy and manage it.

Government has already committed to a range of measures to address these issues: The

Infrastructure Cost Review and subsequent Implementation Plan set out the measures being

taken by Government to realise 2 billion-3 billion per annum from reducing the costs ofdelivery of the UKs economic infrastructure projects and programmes some 40% of which are

delivered through the public sector.

Whilst the markets for economic infrastructure and wider public sector construction are different

they are served largely by the same industry. To ensure that the Government s activities in

these areas are effectively co-ordinated and aligned, the Chief Construction Adviser will chair a

Government Construction Board (the Board) to be established at official level, as an evolutionof the existing Construction Clients Board. It will act as the single Joint Programme

Management Board announced at the time of the 2011 Budget, with responsibility for

overseeing the consistent implementation of the Infrastructure Cost Implementation Plan and

this Government Construction Strategy, together with relevant and necessary actions coming

out of the Governments response to the James Review on education, the McNulty review on

rail and future reports relating to construction.


5/43

1 Introduction

Context

1.1 Construction output contributes some 7% of GDP - more if the whole-life contribution

through planning, design, construction, maintenance, decommissioning and reuse, is taken

into account. The sector is worth about 110 billion per annum1. This comprises three main

sub-sectors:

commercial and social, 49 billion (20bn public, 29bn private);

residential, 42 billion (14bn public, 28bn private); and

infrastructure, 18 billion (7bn public, 11bn private).

Refurbishing and improving the existing built stock accounts for about half of this total.

1.2 There are, however, significant differences between sectors:

for commercial and social infrastructure, projects are typically traditionalconstruction with a mix of new build and refurbishment, with most of the publicsector spend (on schools, for example) being funded through central Governmentdepartments although delivered locally;

in residential, the public sector has a relatively small new build programme (4bn)compared to repairs and maintenance (10bn) the residential construction

k h diff d i h i k d f h


6/43

1 Introduction

inefficiency. This is compounded by low levels of standardisation, and fragmentation of the

public sector client base.

1.6 Following the publication of the Latham and Egan Reports, there has emerged a

consensus that clients and their suppliers need to work together on a shared improvement

plan, and that this means working with fewer suppliers in a more settled supply chain. This hasgenerally been achieved by the creation of frameworks, tendered in accordance with the

requirements of public procurement law - which then stay in place for a fixed period (of up to 4

years).

1.7 The principles behind this remain valid, but there is a tension between the benefits of

working with fewer suppliers in long-term relationships, the desire to maintain a market that is

accessible to new entrants (particularly SMEs) and the risk of locking out competition andinnovation. There is also a risk that the disbenefits of frameworks will be borne, without taking

full advantage of the economies of scale and opportunities for continuous improvement.

Broad Benefits

1 8 IUK I f t t C t i f d th 18b f i f t t di


7/43

1 Introduction

1.11 The Construction Strategy concentrates on a number of steps in this process which

repeated studies3 have shown to be points of weakness, leading to waste, poor value or lost

opportunity.

1.12 The strategy will improve public sector construction and contribute to both growth and

efficiency savings by:

improving visibility and certainty of the forward construction programme, by meansof complete, centrally accessible data about the Government constructionprogramme and the suppliers engaged to deliver it;

setting clear criteria for the way a built asset delivers value in service, andcommunicating requirements (or standards) to prospective suppliers in a clear andconsistent way; establishing by benchmarking a challenging market price for

procurement of the asset, so that cost becomes a major driver in project design anddelivery;

ensuring that there is appropriate early challenge (independent from those directlyaccountable for a programme or project) around: governance and appropriate clientskills, with clear accountability for commissioning and delivery;o the use of benchmarking and feedback from previous projects;o the application of common standards;o project controls and cost reduction incentives;

li i d i d i i h i l i h


8/43

2 Strategy Objectives

Co-ordination and leadership

2.1 The strategy represents a challenging change programme which will need significant co-

ordination and engagement with Government and industry stakeholders. It should not be

underestimated how significant the challenges are; and the strategy can only be implemented

with active involvement and leadership from Government and industry alike.

2.2 Whilst some improvements in the procurement and delivery of construction projects have

been made over time, there is a need now to accelerate the pace of change to deliver a

competitive industry for the future. It is the intent of Government to use its scale in the

procurement of construction to lead the process of change. The construction industry must

also provide an equal measure of leadership, however; and focussed effort will be required

from all parts of the supply chain in a new relationship between Government and the industry.

2.3 Ministers have agreed to combine the programmes of work in relation to the

implementation plans for this construction strategy, IUK's work on infrastructure, and wider

Cabinet Office work on the reform of Government procurement in relation to construction. The

existing Construction Client Board representing Government clients, chaired by the Chief

C t ti Ad i ill b tit t d ith dditi l t ti b t b


9/43


2.7 The Cabinet Office will, working with departments, reinvigorate the Public Sector

Construction Database (the PSCD) to provide the basis of this information.

2.8 Once complete, the PSCD will also provide a basis for client led improvements see

Client Relationship Management.

Governance and client skills

2.9 The range of skills shown in both the public and private sectors in the procurement and

d li f t ti j t i bl F db k f th l id i th t th

Progress to May 2011

The use of the PSCD for central Government departments was mandated

in the Plan for Growth, published as part of the Budget 2011. A short

programme to review its functionality is now under way to identify

refinements and improvements.


10/43


2.13 Core client skills particularly in the case of Senior Responsible Owners and Project

Sponsors, who may not come from a construction background should encompass the

following:

knowing how a project creates value in service delivery;

being able to communicate the conditions for value to the supply side by way ofclear standards which are, to the greatest possible degree, performance-based;

maintaining decisiveness, so that the supply side has the information it needs tomaintain progress and deliver value;

knowing how to take the project to the market place, and the benchmark price forwhich it should be obtainable; and

sponsoring the project from inception to completion.


The Cabinet Office, with Government construction clients, has undertaken a

survey of existing client capability in Government to confirm the extent to

which further skills development is needed.


11/43


2.18 Together with Government Construction Board members, the Cabinet Office will establish

for construction projects the capability required to improve the effectiveness of central

challenge functions in support of projects, together with a framework within which knowledge

and skills can be effectively assessed and shared across Government.

2.19 This work will also address development with IUK and the Major Projects Authority of the

check lists to be incorporated within the newly established Starting Gate Review processes.

Value for money, standards and cost benchmarking

2.20 Cost benchmarking will be established to provide a consistency of value for moneyacross each programme and a baseline for new cost/value-led approaches to procurement.

This will ensure that cost becomes a lead driver in the delivery of projects, without sacrifice of

whole life value; and that clients should be aware, when they go into the market for

construction work, what its price should be.

2.21 Where such benchmarking has been done in detail (as in the schools programme), it has

d t t d th t th i i ti i t th t i t j tifi d b j t ifi d


12/43


2.26 Finally, the criteria for value need to be converted into standards and specifications that

can be passed to suppliers as part of the brief that they are required to meet. There should be

consistency across Government in how these standards are set, and wherever possible they

should be performance (or outcome) based, rather than prescriptive, so that opportunities for

innovation by the supply side are maximised.

2.27 With the support of the Cabinet Office, Government Construction Board members will

therefore:

confirm that a preset measure of value for money at programme level foroperational need exists, and is applied consistently in appraising supplierspropositions;

agree cross-Government principles for setting functional requirements based onwhole life value for money and centred on performance/ output, which can then berolled out across departments;

identify, establish and report on pilot projects for the extended use of costbenchmarking in setting cost targets, and facilitate a more consistent approach tothe application and sharing of cost benchmark data across Government;

introduce ways to leverage existing cost data and compare cost benchmarks across

G t ( d ith i t li t ) t d th d ti t t


13/43


embed the adoption of a standardised prequalification form (PAS 91) so that it isused in all central Government construction procurement;

identify and implement pilots to take forward the leaning of the procurementprocess for construction projects; and

speed cash flow through the supply chain through fair payment provisions.


Prequalification - PAS 91: the use of this standardised wording for PQQs

has been mandated within Government. Work to ensure that the approach

is embedded within the procurement community, and spreads through the

wider public sector, is ongoing.

Fair Payment and Project Bank Accounts: Fair Payment down the supply

chain has been made a contractual requirement on all new construction

procurement by central Government. In addition 1.8bn pounds worth of

projects have been awarded to date using Project Bank Accounts, and

these will be monitored as a model for the future.


14/43


Modelling (BIM). This will be a phased process working closely with industry groups, in order

to allow time for industry to prepare for the development of new standards and for training.

2.32 Government will require fully collaborative 3D BIM (with all project and asset information,

documentation and data being electronic) as a minimum by 2016. A staged plan will be

published with mandated milestones showing measurable progress at the end of each year.

Alignment of design/construction with operation and asset management

2.33 Post-handover defects are a regular feature of construction projects, leading to the cost of

di ti ( d f tl th hi h t f l i di t ) E h th


A Client BIM Mobilisation and Implementation Groupto drive the

adoption of BIM across government has been established and met for the

first time in May 2011, and a staged implementation plan will be publishedin June.


15/43


how they are performing in aggregate.

2.37 Government will reform its relationship with its major construction suppliers to:

communicate clearly to its suppliers the Governments expectations and, through a

Strategic Alignment Agreement, agree and implement the steps of a programme bywhich a supplier will bring its processes into compliance with the requirements ofGovernment as client;

require good practice in dealings between Government and its directly contractedsuppliers to be cascaded down through the supply chain;

establish a cross-Government view of each supplier.


Reform will build upon a mature key Supplier Relationship Management

programme that currently exists. This includes:

regular one-to-one engagement;

establishment of strategic alignment agreements;

ongoing supplier performance assessments; and

bi l t t i li f


16/43


New procurement models

2.40 The construction strategy sets out the principles of an alternative approach towards

procurement, designed to eliminate the wastefulness of teams completing and costing a series

of alternative designs for a single project, only one of which will be built.

2.41 This has been the subject of continuing dialogue with the industry, seeking a more

collaborative, integrated model that nonetheless maintains competitive tension and the ability

to demonstrate value for money. More specifically, two propositions have been put forward by

industry teams, which offer opportunities for demonstration projects:

one effectively pitches framework contractors against a challenging cost

benchmark, with the understanding that if no member of the framework can beat thebenchmark, then the project will go to tender without framework contractors beingpermitted to bid, providing opportunities for new entrants; and

the other offers a guaranteed maximum price underwritten by insurance, which alsoextends to protection against defects.

2.42 Both propositions assume the full engagement of an integrated team with designers,

th f i l lt t d t t ff i i t t d iti d ith


17/43


Board, will further develop these propositions, trialling them on live projects with a view to

rolling out successful practices across Government.

Client Relationship Management

2.45 Just as supplier relationship management is important, it is also necessary to ensure

consistency of approach in the way Government collectively addresses its approach to the

delivery of common opportunities such as waste-to-landfill, and the scope for aggregation of

demand.

2.46 Once complete, the PSCD, in addition to giving suppliers visibility of the pipeline, will also

provide a basis for:

planning procurement strategies appropriate for the full programme;

investigating the scope for commoditisation and central purchasing across theprogramme;

identifying key suppliers (which currently calls for an ad hoc exercise); and

investigating the scope for reducing transaction costs and seeking consequent

l l t d di t b id tif i th t f k l d ith i di id l


18/43


Implementation of existing and emerging Government policy in relation to

sustainability and carbon

2.48Specific actions will be developed in relation to Governments construction strategy for

sustainability and carbon following the publication of Governments response to The IGTReport: Low Carbon Construction, to be published in June 2011.


19/43

Annex A: Summary Action Plan

19

Ref Theme Objective Specific Actions and Timescales Measures

Mar-2011 Mar-2012 Mar-2013

1. Co-ordinationand leadership

1(i) To improve co-ordination of, and

consistency between,

approaches to construction

procurement across

Government

Establish theGovernmentConstruction Boardand agree Terms ofReference.(June 2011)

Publish fullgovernancestructure forprogramme ofreform, includingGovernment/Industry SteeringGroup and TaskGroups.(July 2011)

Quarterly meetingsof GovernmentConstructionBoard.

Meetings ofSteering Groupand Task Groupsas appropriate.

Quarterly meetingsof GovernmentConstructionBoard.

Meetings ofSteering Groupand Task Groupsas appropriate.

Overarchingchangeprogrammeestablished.

1(ii) To engage with industryto secure participation inimprovement initiatives

Appointment ofprogrammemanagement

resource. (July2011)

Governancestructure for theprogramme clear.


20/43


20


Mar-2011 Mar-2012 Mar-2013

Work with industryto appointappropriate industryresource to supportprogrammemanagement andworking groups.(from July 2011)

Work with industryto appointappropriateindustry resourceto supportprogrammemanagement andworking groups.(Ongoing)

Set baseline andestablish benefitsachieved 2010-11.(Summer 2011)

1(iii) To direct and support aprogramme of reform.

Publish strategy andSummary ActionPlan.(May 2011)

GovernmentConstruction Board

to ratify Action Plan.(July 2011)

Refresh and re-mandateGovernment

Progress of costreduction against10-20% target.


21/43


21


Mar-2011 Mar-2012 Mar-2013

ConstructionStandards (formerlyCommon MinimumStandards)(September 2011) -including AchievingExcellence inConstructionstandards whererelevant(From October

2011).

Establish aprogramme of pilotprojects inconnection with theactions below.(October 2011)

Track levels of participation by industry.(Ongoing)

Maintain high levelof participation

1(iv) To stress cost

effectiveness as a keydriver, without loss of wholelife value.

Launch a

redesigned BetterPublic BuildingsAward.(July 2011)

Review and

determine howwhole life value willbe measured(April 2012)


22/43


22


Mar-2011 Mar-2012 Mar-2013

Event todisseminate detailedlearning of goodpractice fromwinners/ short listedprojects.(February 2012)

Repeat event.(January 2013)

Repeat event.(January 2014)

2. ForwardProgramme and

data

2(i) To provide procuringdepartments with visibility

of the total pipeline toidentify opportunities forcollaboration and the needfor market management .

The Cabinet Officeto develop and

implement guidancefor maintaining andpublishing forwardwork programmesacross all centralGovernmentdepartments.(Summer 2011)

Departments tomaintain prioritised

lists of forwardpublic sectorprojects capable ofaggregation into aCentralised PublicSectorConstructionDatabase(PSCD).(Ongoing)

Commitment ofdepartments to

provide data.

The Cabinet Officeto work with centralGovernmentdepartments topopulate animproved PSCD

Undertakevalidation toconfirm robustnessof data.(Autumn 2012)

Undertakevalidation toconfirm robustnessof data.(Autumn 2013)

Population andinternal publicationof database on aquarterly basis.


23/43


23


Mar-2011 Mar-2012 Mar-2013

with keyconstructionsuppliers identified.

Publish fullypopulated PSCDinternally.(Autumn 2011)

2(ii) To maximise acrossGovernment the benefitsderived from historic cost

data

Establish datarequirements toimprove

effectiveness ofcentral challengefunctions insupport ofconstructionprojects.(April 2012)

2(iii) To provide supplierswith visibility of the pipeline

so they can equipthemselves to respond orinvest.

First externalpublication of

forward pipelinederived from PSCD.(Autumn 2011)

Survey suppliersand departments

to confirm howpipelineinformation isbeing used inpractice.(Autumn 2012)

Repeat survey ofsuppliers.

(Autumn 2013)

Publication offorward pipeline on

a quarterly basis.


24/43


24


Mar-2011 Mar-2012 Mar-2013

2(iv) To ensure thatdecisions to postpone orcancel projects or

programmes are timely andinformed by a full analysis ofimpact.

Establish aprocess tomeasure full

impact of projectcancellation.(April 2012)

Roll out process(consistent withMPA).

(April 2013)

Departmentsapplying processand evidenced.

3. Governance andclient skills

3(i) To establish appropriategovernance structures,consistent with the remit andedicts of the Major ProjectsAuthority; and to givetransparency tomanagement accountability

within Government.

Re-affirm andpublish project/programmegovernancestructures forfunded projects.(September 2011)

Tracked andchecked by entryonto the PSCD.(Ongoing)

Adapt PSCD andtrack departmentalentries to confirm

Publishgovernancestructures, and theaccountableindividuals, for allprojects andprogrammes.


25/43


25


Mar-2011 Mar-2012 Mar-2013

that departmentshave published.(April 2012)

3(ii) To equipcommissioning teams with

the necessary client skillsappropriate to specificprojects and programmes.

Define necessaryskills for defined

roles in governancestructure withparticular referenceto the 20% target.(January 2012)

Establish capabilityrequirement to

improveeffectiveness ofcentral challengefunctions insupport ofconstructionprojects(April 2012)

Establish commonprinciples for

assessingcapability.(April 2012)

Roll out challenge

Commissioningteams equipped

with theappropriate skills,consistent withAEC and cost-targetedprocurement(commercialchallenge).


26/43


26


Mar-2011 Mar-2012 Mar-2013

capability andtrack progress,through use of theAchievingExcellence inConstructionembedding tool.(From June 2012)

Establishframework for

sharing/ enhancingskills betweenareas of expertise(e.g. project rolesin programme orgovernancestructures).(From June 2012)

Consistentapproaches and

core trainingcontent acrossdepartments.

Demonstratepositive progress

towards thecapability/behaviour relatedtargets.


27/43


27


Mar-2011 Mar-2012 Mar-2013

4. Challenge 4(i) To reinforce governanceand to support the internaldecision making process,consistent with the MPAsStarting Gate Reviewprocesses.

Work with IUK andthe MPA to developthe check lists withinthe Starting GateReview processes(for the majorprojects portfolio)(From April 2011)

Adapt newchallenge processand incorporateinto departmentalapprovalprocesses for allconstructionprogrammes andprojects below theMPA threshold.(July 2012)

Monitor and reviewthe implementationof the challengeprocess. (Ongoingfrom June 2013)

Publishindependentchallenge process.

5. Value formoney,standards andbenchmarking

5(i) To identify the criteriafor value against whichsuppliers propositions willbe appraised.

Encourage the useof outcome basedspecifications andprocesses that willencourageinnovation andremoveunnecessaryprescription.

(Ongoing fromMarch 2012)

Departmentalmeasures of valuefor money areconfirmed, thereare consistentprinciples appliedand criteria arecommunicated tothe market.


28/43


28


Mar-2011 Mar-2012 Mar-2013

Confirm that presetdepartmentalmeasures of valuefor money exist atprogramme levelfor operationalneed, and areapplied.(April 2012)

Departments toimplement newmodels to promotewhole life,outcome basedspecifications as ameans toencouragingsupply chaininnovation.(From March

2013)

Demonstration onTriali projects.

Agree principles offunctionalrequirement setting(based on measuresof value for money,and centred onperformance/output) acrossGovernment.(March 2012)

Roll out newprinciples forsetting standardsacrossdepartments.(From March2012)

Assess and reviewimplementation ofthe principles forsetting standards.(From March2013)

Supply chaininnovations andinfluence on valuethrough earlyinvolvement areevident andmeasurable.


29/43


29


Mar-2011 Mar-2012 Mar-2013

5(ii) To set challenging costtargets in the context ofclear criteria for value,informed by what has beenachieved on other projectsand supply chain analysis.To motivate suppliers andremove impediments todelivery. To seek anddeliver product and processinnovation at all levels of the

supply chain.

Establish quality ofbenchmarking datain departments.(June 2011)

Agree principles ofbenchmarkingstandards (January2012)

Trial projectsdemonstrating theoutcome of costled procurementswhich providepractices that canbe rolled outacross centralGovernment.

Communicate anexpectation of theuse ofbenchmarking forpublic sectorconstruction.(January 2012)

Publication ofexpectations.

Identify andestablish pilots forthe extended use ofbenchmarking insetting cost targets.(October 2011)

Report on the outcomes of the pilots forthe extended use of benchmarking insetting cost targets.(Ongoing)


30/43


30


Mar-2011 Mar-2012 Mar-2013

Departments to bring benchmarking up toan agreed standard (using agreedcommon measures and formats wherepossible), and share across Government.(From March 2012)

Monitor and reviewimplementation(From March2013)

Cost effective bycomparison withrelevant privatesectorcomparators.

5(iii) To confirm that non-product costs (fees,departmental overheadsetc) are proportionate fromproject to project, and

contribute to improvingwhole life value.

Establish, define targets and implement amethodology for indicating total projectcosts across departments.(From September 2011)

Deliver thefinancial ValueIndicator definedtargets.

Monitor and report on progress ofreducing non product costs. (Ongoing)

6. Efficiency andelimination ofwaste

6(i) To eliminate waste andduplication that leads tounnecessary cost or delay inthe procurement process.

Agree movestowards use ofstandard form(s) ofcontract, withoutunnecessarybespokeamendment.(Summer 2011)

Unamendedcontracts used bydepartments inaccordance withdefined targets.


31/43


31


Mar-2011 Mar-2012 Mar-2013

Consider the use ofintegrated projectinsurance to supportobjective 11(iii) andreport.(Winter 2011)

Project insurancetested, evaluatedand potentiallyrolled out.

6(ii) To reduce the barriersto entry represented byonerous, unduly complex orprotracted procedures

Embed the use ofstandardisedprequalification form(PAS 91).

(Ongoing)

PAS 91 used byGovernmentclients andsuppliers and

down the supplychain.

Streamlineprocurementprocess on basisconsistent withprinciples of theCabinet Officeproposals for "leanprocurement"generally.(January 2012)

Roll out therecommendationsfrom the CabinetOffice workstream.

Lean procurementpiloted.


32/43


32


Mar-2011 Mar-2012 Mar-2013

Identify andimplement leanprocurementpilot(s).(From December2011)

Monitor progress of reducing time forprocurement.(Ongoing)

Speed ofprocurementreduced to thetarget.

6(iii) To speed cash flowthrough the supply chain toreduce the working capitalburden and increasesecurity of payment for

lower tiers of the supplychain, particularly SMEs

Embed revised fair payment provisions, including samplechecks through the supply chain.(Ongoing)

Fair Paymentprovisions securedcontractuallythroughout allcentral

Governmentprojects, withoutexception.

Define target forincreased use ofproject bankaccounts (PBAs).(August 2011)

Monitor use ofPBAs on trialprojects andcapture lessons forfuture use.(Ongoing)

Monitor use ofPBAs and capturelessons.(Ongoing)

Increased use ofPBAs to definedtargets.


33/43


33


Mar-2011 Mar-2012 Mar-2013

6(iv) To managecontingency allowances sothey are realistic but do notcreate the expectation thatthey will be spent.

Agree standardapproach towardsrisk/ contingencymanagement, inconjunction withIUK.(January 2012)

Measurementshows appropriatelevel, managementand use ofcontingency.

6(v) To assess theperformance of currentprocurement practices in

delivering requiredoutcomes.

Review currentpractice and exploreprocurement models

which maximisevalue.

Consideralternatives tocurrent procurementprocesses andinterpretation/application of EUDirectives.(Autumn 2011)

Commenceimplementation ofrecommendations

through trialprojects.

Reduce reliancewithin the publicsector on the

inappropriate useof short-termcompetition on thebasis of initialcapital cost as theprimary means fordriving efficiency.

Benchmarkingdemonstratesreduction

contributing to theoverall 10-20%reduction.

Trial projectpractices adopted.


34/43


34


Mar-2011 Mar-2012 Mar-2013

Encourage greaterrisk basedassessment ofcompetition andprocurement optionswith greater focuson innovation,cost/value andperformanceoutcomes.(To be agreed

2011)

Considerincorporatingspecific guidanceinto Green Bookon procurementoptions assessedon a risk basis.(April 2012)

Government to work with industry and the ProcurementLawyers Association to encourage a more pragmatic approachto compliance. Support the EU consultation on procurementDirectives to ensure revisions are consistent with UK objectivesto remove wastage and procurement legislation that stiflesinnovation.(Ongoing)

7. BuildingInformationModelling(BIM)

7(i) To introduce aprogressive programme ofmandated use of fullycollaborative BuildingInformation Modelling forGovernment projects by2016.

Creation of theimplementation planand team to deliver.(July 2011)

Begin phased roll out to all Governmentprojects.(From Summer 2012)

Completion ofagreed pilots.


35/43


35


Mar-2011 Mar-2012 Mar-2013

Define andmandate theexpected standard(information set)for Governmentprojects.(April 2012)

Commencement ofroll out achieved.

Identify trialprojects in multipledepartments toachieve delivery

via 3D fullycollaborative BIM.(July 2012)

Complete builtrecord of theproject availablefor the purposes of

assetmanagement.

Evaluate trial projects and recommend.(Ongoing)

8. Alignment ofdesign/constructionwith operationand asset

management

8(i) To align interestsbetween those who designand construct an asset andthose who subsequently useit.

Trial introductionof a period (say 3to 5 years) of postcompletion provingof the asset by the

constructors.Note connectionwith BIM and itspotential toconnect designand construction

Projects designedand delivered torequiredstandards; and toallow the asset to

operate to therequired standardfor its whole life.


36/43


36


Mar-2011 Mar-2012 Mar-2013

information toassetmanagement.(Summer 2012)

9. SupplierRelationship

Management

9(i) To measure supplierperformance across all

programmes to supportobjectives 12(i) & (ii) and5(iii).

Programme of supplier conferences and dialogue withindividual suppliers.

(Ongoing)

Key suppliers'performance

routinely measuredand communicatedacrossGovernmentprogrammes(client and supplyside) through acommon process.

9(ii) To develop andimplement a sharedprogramme for efficiency

and reform.

Routinely assess and communicate key suppliers' performanceacross Government programmes through a CommonAssessment Framework. (Ongoing)

Delivery againstagreed targets.

9(iii) To require suppliers toalign with a shared view ofexcellence and to cascade

Redefine a sharedview of excellence.(January 2012)



37/43


37


Mar-2011 Mar-2012 Mar-2013

good practice down throughthe supply chain.

Formalise the process of compliance and improvement throughSupplier Alignment Agreements.(Ongoing from Dec 11)


10. Competitiveness and reducingduplication(whole publicsector)

10(i) To assess theeffectiveness of frameworks,in collaboration withdepartments and theNational Improvement andEfficiency Partnership forConstruction.

Investigateeffectiveness of useof frameworks - interms of criteria forselection and valueto the taxpayer.(Autumn 2011)

Study findings andrecommendationsmade.

Commenceimplementation ofrecommendations.

Delivery of aplatform thatensuresGovernment andthe wider publicsector havevisibility of goodqualityprocurementchannels tomarket.

Investigationcomplete andrecommendationsmade by a time tobe agreed.

Identify the best useof routes to market.(Initial view

January 2012)

Spend focussedon appropriateroutes to market

by client capability.Portion of spendtarget as setthrough qualityframeworks.


38/43


38


Mar-2011 Mar-2012 Mar-2013

11. NewProcurementModels

11(i) To investigatealternative forms ofprocurement andcontractual arrangementthat offer better value andaffordability.

11(ii) Consistent with theinitiatives above, to reviewapproaches to incentive andrisk apportionment.

Develop new modelcompetition andprocurementprocesses incollaboration withdepartments andtheir agencies toencourageinnovation throughintegration andearlier supply chain

involvement.(January 2012)

Commenceimplementation ofrecommendationsthrough trialprojects.(April 2012)

Evaluation of trialprojects(from Mar 13)

Truly integratedteamdemonstratedi.e. designers andconstructors withfull supply chainreporting to clienton a collectivebasis.

All parties share

commonagreement interms of keyprinciples.

Simplifiedcontractualarrangements andrisk pricing broughttogether.Analysis andreport of trial pilotproject complete -new way ofprocurement(under research


39/43


39


Mar-2011 Mar-2012 Mar-2013

provision of EUrules inconsultation withindustry).Evidence of teamproblem solving.


40/43


40


Mar-2011 Mar-2012 Mar-2013

Benchmarkingdemonstratesreductioncontributing to theoverall 10-20%reduction.Trialproject practicesadopted.

11(iii) To investigate thevariety of options for usingprivate finance and

appropriate risk transfer tothe private sector in thedelivery of capital projects.

Infrastructure UK to lead, working closelywith the Cabinet Office. (Ongoing)

12 ClientRelationshipManagement

12(i) To develop a range ofoverarching procurementstrategies appropriate to thewhole programme.

Analysis of PSCDdepartmental inputto identify the rangeof opportunities, andidentify trial projects.(January 2012)

Deliver andevaluate trialprojects.(From June 2012)

Trial projectsdemonstratepracticality andbenefits ofaggregation.

Potential roll-out ofpilotedapproaches.


41/43


41


Mar-2011 Mar-2012 Mar-2013

12(ii) To exploreopportunities for centralisedprocurement of commoncomponents.

With departments,identifyopportunities tocentralisepurchasing and settargets.(April 2012)

Greater use ofcentralisedprocurement andresulting costreductions.

Deliver andevaluate trialprojects.

(From June 2012)

12(iii) To investigate thescope for reducingtransaction costs andseeking economies of scaleand volume-relateddiscounts.

Confirm existing andpotential keysuppliers to centralGovernment.(Autumn 2011)

With departmentsand key suppliers,identifyopportunities toreduce transactioncosts forexample bygreater use ofstandardisedprocesses.(April 2012)

Simplified/centralised processesleading to costsavings.


42/43


42


Mar-2011 Mar-2012 Mar-2013

Deliver andevaluate trialprojects.(From June 2012)

12(iv) To investigate thescope for increased productstandardisation to supportobjectives 12(ii) & (iii) withinand between programmes.

Investigate scopefor furtherstandardisation ofbuildings, systemsor componentsacross Government

programmes.(From June 2011)

Implementcommodityprocurement foropportunitiesidentified.(Summer 2012)

Opportunitiesdefined,implemented asappropriate andrealised.

13 Implementationof existing andemergingGovernmentpolicy in relationto sustainabilityand carbon

13(i) To deliver futurecarbon reductions in theGovernment estate throughthe procurement of newconstruction, for example bydeveloping approaches toappraising constructionprojects on a whole lifecarbon basis includingembodied carbon, andworking with departments

To be advisedfollowing publicationof the Governmentresponse to the BISInnovation andGrowth TeamReport on LowCarbonConstruction, andthe subsequentagreement of an

To be advised. To be advised.

Reduced carbonemissions, waterconsumption andwaste to landfill inaccordance withagreed targets.


43/43


43


Mar-2011 Mar-2012 Mar-2013

and industry to deliverexisting and emergingStrategy for SustainableConstructiontargets.

action plan.

iTrial Projects are to test propositions set out in this strategy, such as: lean procurement processes generally; use of whole life, outcome basedspecifications that remove unnecessary prescription and encourage supply chain innovation; applying a cost- targeted, integrated approach to procurement;aggregating demand across Government, generating economies of scale for example through the centralised procurement of common components, asappropriate; integrated project insurance; the phased introduction of Building Information Modelling; and post -handover operation of built assets all with aview to testing practice which can, if successful, be rolled out across Government.

government construction strategy

Documents