To achieve their aim of delivering ‘better, faster and greener’ projects, the UK Government has published new guidance for working with suppliers in The Construction Playbook.
Underpinning the 12 chapters within the Playbook are 14 policies, all of which focus on improving how the public sector works with the construction industry. The guidance applies directly to central government agencies, and is to be considered ‘good practice’ by the wider public sector – meaning all suppliers should familiarise themselves with the guidance to achieve the best possible scores when bidding for work.
While we recommend relevant suppliers giving the Playbook a through read – at 83 pages long it is certainly not light reading! For reference and as an initial overview, we have provided a summary of the key outcomes and policies below.
What does better, faster and greener look like?
The outcomes the government aims to achieve from implementing this new guidance are:
◆ Clear and appropriate outcome-based specifications
◆ Longer term contracting across portfolios
◆ Standardised designs, components and interfaces
◆ More innovation and adoption of modern methods of construction
◆ Sustainable, win-win contract arrangements incentivising better outcomes
◆ Better financial assessment of suppliers and continuity planning
◆ Increased speed of end-to-end project and programme delivery
◆ Improved building and workplace safety
◆ Contribute to 2050 net zero commitment
◆ Promote social value
The Construction Playbook’s 14 Key Policies
- Commercial pipelines
The government will ensure the market is aware of all upcoming projects and aim to publish pipelines for the next 3-5 years. This gives suppliers plenty of time to engage with buyers and arrange joint bids before contracts have been published.
- Market health and capability assessments
They will work to design strategies and contracts that help to maintain a healthy market – by addressing barriers to entry, taking advantage of innovations, and promoting competition.
- Portfolio and longer term contracting
To achieve faster, better and greener projects, the government will use longer-term contracts and look to create portfolios of work where applicable. This can make things easier for you by creating standardised requirements, while also creating longer term opportunities.
- Harmonise, digitise and rationalise demand
Where possible, opportunities to collaborate with other contracting authorities will be sought to establish common standards across a range of projects – offering you opportunities to develop efficiencies and innovations for the sector.
- Further embedded digital technologies
Data will play a significant role in helping to improve safety, enable innovation, reduce costs and produce more sustainable outcomes. Suppliers and buyers are encouraged to adopt the UK Building Information Management (BIM) Framework.
- Early Supply Chain Involvement (ESI)
Engaging with suppliers earlier is a policy that will help to improve efficiency by providing you with opportunities to make recommendations on design, cost, risk management, and structuring of projects.
- Outcome-based approach
A shift in focus from ‘scope’ to ‘outcomes’ on whole life value. Suppliers will have to consider how their proposals fit into the government’s wider economic, social and environmental priorities.
- Benchmarking and Should Cost Models
Data will be gathered to set benchmarks for cost, delivery time, emissions and key outcomes. The use of Should Cost Models (SCM) will be used to forecast whole life costs and risks of proposed projects – which will influence their Delivery Model Assessments (DMA) and how contracts will be awarded.
- Delivery Model Assessments (DMA)
The use of DMAs will ensure contracting authorities use evidence-based processes to determine the best delivery model for projects. These assessments will offer you pre-engagement opportunities with buyers before contracts get published.
- Effective contracting
Procurement will create value for all by creating sustainable, resilient and effective relationships with suppliers. This means putting a greater focus into contract types, outcomes and overall strategy.
- Risk allocation
By working with suppliers at an early stage, risks should be addressed and have solutions developed to mitigate these before construction begins. Risk allocation will then determine which parties will assume each risk.
- Payment mechanism and pricing approach
Working to establish the best pricing based on delivery of outputs, work value or supplier performance. Pricing should reflect the level of certainty or risk around the scope and requirement.
- Assessing the economic and financial standing of suppliers
The economic and financial standing of suppliers will come into consideration to safeguard the delivery of projects. These assessments will form part of their risk management activities and be tailored to each specific project.
- Resolution planning
Focuses on mitigating the impact of insolvency of projects. While major insolvency is rare, this is now part of their risk management, and you will now be required to provide resolution planning information in the form of a Service Continuity Plan (previously known as Business Continuity and Disaster Recovery Plans).
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