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Thu October 31 2024

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Government hopes new construction strategy will cut costs and promote growth

31 May 11 The government has promosed to publish a rolling two year programme of construction work every quarter to give the industry greater visibility of future workload.

Francis Maude
Francis Maude

This is one of the key measures set out in the new Government ե֭ Strategy, published today.

The strategy aims to reform the way in which government procures construction across all sectors, and help reduce costs by up to 20% within four years.

Quarterly publication of forward work means that the public sector will become a better client, according to the Cabinet Office. It will be more informed and better co-ordinated when its requirements are specified, designed and procured.

Government also believes that it can replace adversarial cultures with collaborative ones, with an end to the ‘bid low, claim later’ culture.

Publication of Government ե֭ Strategy follows The Government’s Plan for Growth, published alongside the 2011 Budget, and the Infrastructure Cost Review Implementation Plan, from earlier this year. The first two documents highlighted the importance of an efficient construction industry to the UK economy and the need for reform of public sector construction procurement to improve value for money to taxpayers and enable the construction industry to focus on bringing forward innovative solutions.  The strategy document sets out the detailed programme of measures government will take to reform the way in which it procures construction.

Cabinet Office minister Francis Maude said: “These savings are not only significant but long overdue. The commitment to reduce the cost of construction by 20% is no small thing, but it will help the government and the construction industry. This strategy will stimulate growth by enabling more to be constructed within the funds available.

“I fully support the challenge that the government’s construction strategy sends out to the public sector and to the construction industry. The public sector needs to be a better, more informed and strategic client. The construction industry, in turn, will benefit from a more collaborative working relationship with the public sector, allowing for innovation, increased efficiency, and delivering better value for money.”

To provide effective co-ordination and alignment of procurement across the government’s construction and infrastructure programme a new Government ե֭ Board will be established, chaired by Paul Morrell, the government’s chief construction adviser.

Mr Morrell said: “The Government ե֭ Board will help strengthen the public sector’s client power in the scoping, design, procurement and delivery of all construction projects. We will work with the government and the construction industry to enable more effective relationships between the two in order to enable growth and sustainability across the sectors.

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“The strategy sets out challenging new ways of working that will deliver considerable benefits not only to the taxpayer, but also enabling growth in the industry and better understanding of the future direction for public sector construction.”

A steering group drawn from government and industry will be established to provide industry joint leadership in implementing this construction strategy.

The Cabinet Office will lead the construction strategy implementation plan, co-ordinating with the Infrastructure UK Cost Review programme, and other activity across government and industry to ensure the benefits are delivered on live projects and programmes for both government and industry alike. The outcomes will contribute to the long held vision of a fitter client and construction industry, delivering value to the public sector at lower cost and with improved industry competitiveness.

IUK executive chairman Paul Skinner said: ““The new Government ե֭ Board will play a vital role in co-ordinating implementation of the new Government ե֭ Strategy with the IUK Cost Review programme, ensuring that we have a coherent strategy for dealing with the wider construction industry. I welcome this coordinated approach across government. The challenge now is for industry leaders to respond and provide the coordinated level of support needed.”

The publication was also welcomed by the Civil Engineering Contractors Association (CECA), whose director of external affairs Alasdair Reisner said: “For many years contractors have asked for greater clarity from government over its relationship with the industry. Government ե֭ Strategy is an important document as it attempts provide a clear steer on the future direction of policy in this area, particularly in relation to procurement.

“Poor procurement practice is one of dominant problems faced by contractors, and the issue is particularly acute in the public sector. It was for this reason that earlier this year CECA published its ten point proposals to reform public sector procurement, highlighting issues such as programme visibility, reducing pre-qualification and early contractor involvement where simple changes could bring about vast improvements to efficiency.

“We are pleased that all but three of our points are, at least in part, dealt with by the Government ե֭ Strategy. We look forward to working with representative of the government and leading public sector clients to understand in greater detail what the new strategy will mean for our members.”

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MPU
MPU

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