Simplify Scottish construction procurement to save money

22 October 2013

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23 October 2013 | Gurjit Degun

An independent review of the way in which the Scottish public sector purchases construction work has called on the government to simplify the process to save money.

The Review of Procurement in Construction examined how public bodies involved in construction-related procurement adopt practices that are “streamlined and deliver value for taxpayers’ money”. It estimated the total annual public sector spend on construction is £4 billion.

“Some practices in public sector construction procurement, such as pre-qualification, are frequently over-elaborate and increase costs for both the public sector client and the private sector contractor,” the study said.

“Over-lengthy documentation and processes can reduce transparency and have the opposite effect of what is intended by increasing costs for both parties, as well as the possibility of challenge.”

It called for a review of the methods of “strategic prioritisation of construction spending across the public sector in Scotland to identify best practice” and the need for a better “co-ordination of construction spending”.

The report also said public bodies should consider using Quick Quote, an online quoting facility, for contracts under the thresholds proposed in the Procurement Reform Bill. The Bill says Quick Quote should apply to works contracts less than £2 million, and to supplies and services contracts worth under £50,000.

“Public contracting authorities should, however, still satisfy themselves that they are being transparent and fair,” the report added.

A further recommendation noted there should be a chief construction adviser to challenge the public sector and industry on its pace and progress of implementing the recommendations, and be a conduit for industry to raise concerns with or approach ministers.

Other recommendations include: greater leadership of construction procurement; improved construction skills across the public sector; and design to be at the heart of construction procurement.

The reports authors, Robin Crawford and Ken Lewandowski, welcomed news the Scottish Government is trialing Project Bank Accounts to ease cash flow problems in the supply chain. They added the recommendations should not come as a “great surprise” because they are a result of extensive consultation.

Speaking at the Scottish Government National Public Procurement Conference in Glasgow yesterday, Crawford said: “Our vision is of an approach which achieves better collaboration in design-led procurement, which achieves value for money for the public sector but which also recognises that the construction sector is a vitally important part of the Scottish economy.

“Much of the procurement undertaken by the public sector is conducted by capable people, but good practice is not uniform across the entire public sector, and we see many opportunities for others to learn from this best practice.”

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