“Construction Procurement” sounds like the driest, most specialist, horlicks-of-a-subject. It comes alive when it goes wrong: fills newspapers and courtrooms, damages jobs and local economies and haemorrhages public money. Scotland is world-class at getting it wrong, with the humiliation of the Parliament’s procurement in danger of being surpassed by that of the Edinburgh Tram.
High profile failures give people the impression that construction is, inevitably, a financial and procedural disaster. But freed from government dogma and European legislation the private sector often does it well. Just compare private schools like St Aloysius, St Georges and Fettes, with their beautiful, cost-effective new buildings, to the expensive Government PFI and PPP schools that will have us in hock to big corporations for generations.
The success of any project is based on the care taken to understand its purpose, design and detail it well and properly manage its risks. The best procurement is individually-tailored, adaptable and flexible. Yet successive British governments have bundled the procurement of public buildings away from such responsible measures and into the hands of mega-corporations.
Publication / The Times
In Scotland we had the chance to do things better, and the incoming SNP administration criticised such huge and wasteful public-private initiatives. The Scottish construction industry is, therefore, looking askance at the Government’s plans for the unfolding “Hub” initiative, which will establish five huge corporates, each with 10 or 20 year monopolies over public building.
The Scottish Futures Trust (SFT), which runs The Hub, divided the country into five super-regions. Ours is a wee country, and our builders struggle to compete at such a scale. Of the two contracts awarded so far one has gone to the Miller Group. But the south-east super-region contract – for Edinburgh, Lothians, Fife and Borders – has gone to a consortium all headquartered in England. The SFT emphasises that there will be work further down the “supply-chain” for local builders, architects and engineers. But does this still not represent a primary loss of leadership, and money, down south?
My second concern is the relegation of the architecture of a building to an item in a contractor’s supply-chain. It seems to me, when I look at the quality of most of today’s architecture, that it suffers from a lack of care and attention. Do we really want to drive down costs here, even further?
My final issues are with the very concept of a monopoly. It’s not currently possible to establish the lower limit for the Hub’s projects – £750,000 has been mentioned, as has £5 million (an extraordinary uncertainty, given two contracts are let). But the skills needed to deliver a new-build city hospital are very different from those to convert an old building in a rural town, to co-locate local services. Huge contractors are simply not cost-effective for diverse small work.
And where did we get the idea that 10 and 20 year monopolies were cost-effective, or could deliver consistent quality? The Hub’s quality-check processes are no match for good old fashioned carrot-and-stick: that we have to deliver, today, in order to have more work tomorrow.
