Government construction contracts need to be reformed


A few days ago I held a discussion with a local building company that is currently carrying out some work on behalf of a much larger construction company in a town close to where the local company and my company is based. The work is part of a Government policy referred to as the ESFA Priority School Building Programme 2 to rebuild a significant series of Schools across the country that have fallen into disrepair over many years due to a lack of investment or that need to expand due to the number of pupils in the areas concerned. All of the contracts for these jobs have been placed through a small number of very large building companies across the UK. The school concerned happens to be one which my own company has worked with in the past to fit out Audio Visual systems. One of the challenges is that communication between the School along with the local Council and the on site building company needs to take place through the main contractor who will make decisions based on their contract from the Government and then the local builder will have to interpret those decisions on site. For the scheme to work the sub-contractor is paid a sum it can afford to work for and then the main contractor charges a management fee of one assumes 10%-20% of the contract costs and that is what the Government pays on behalf of the tax payers, some of whom send their children to the School or who work for the building company. The nature of such projects is that they include more than building construction and so there are IT and Audio Visual and Telephone elements which the School needs to understand and ideally should be able to influence along with how the building will look and its layout. However to make changes in any of these areas, the School needs to communicate with the main contractor who then directs the relevant sub-contractors to carry out these requests.

Even though we work with the School in question outside of this project, when it comes to working on the new building area our only prospect is to approach the main contractor to try to win the business. Because there are a number of similar scenarios to this in the local area we have had a range of conversations with a range of builders and main contractors and schools, all in order to see if we could win any work. In the end we also spoke to companies who are contractors for other elements because some of the building companies are either unaware of the difference between telephone and IT and AV requirements or they simply prefer to avoid answering straight questions. When I discussed the matter with one of the contractors they pointed out that they would rather not carry out the work in question because it is well outside the geographical area they are comfortable with, but the main contractor insists that if they want to have any business, they need to work on all of the projects. The irony is that if the main contractors were removed from the mix, the contracts could be handed directly to local building companies, who along with local architects and local IT and local telephone suppliers and local AV suppliers could carry out the work directly. Some of the cost saved by not paying 10%-20% into the income of main contractors could then be used by the Government to manage the contracts through a larger number of suppliers, but the end result would be a great deal more effective in many of the locations. However it may be that some of the smaller builders would be less inclined to fund the Conservative Party than some of the larger builders do at the moment so perhaps there is a political element to this approach?

About ianchisnall

I am passionate about the need for public policies to be made accessible to everyone, especially those who want to improve the wellbeing of their communities. I am particularly interested in issues related to crime and policing as well as health services and strategic planning.
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