Construction

Potential Big Win Suggestion:Build Using a Managed Framework Contract

Impact overview
Hard to implement / 1------2------3------(4)------5 / Easy to implement
Risk High / 1------2------3------(4)------5 / Risk Low
Negative Policy Impact / 1------2------3------(4)------5 / Positive policy impact
Slow return (12 months or more) / 1------2------(3)------4------5 / Fast return
What is it?
The West Midlands Contractor framework contract is an agreement with three suppliers (Kier Moss, Spellar Metcalfe and Thomas Vale) to build £200 million of construction projects over the 4 year period from September 2010. This project was designed on the best practice principles adapted from other frameworks, i.e. the IESE model and therefore is “state of the art”. There was a deliberate decision to keep it contact so as to encourage local interest and to reflect the likely commitments from interested Councils.
What are the benefits?
9% cost reductions compared against the public sector benchmark (saving around £16 million)
15:1 return on investment
85% of projects being completed within 5% of target costs
10% Improvement on time predictability
35% in cost predictability
15% improvement in key performance indicators
60% of spend within the local SME market
What is the Big Win proposal?
The contractor framework is a tried and tested approach that has delivered significant benefits in most regions
What are the risks/problems to avoid?
To ensure the procurement process for the framework was robust and that using it meets the requirements of EU procurement legislation.
To ensure that the framework is actively managed to exploit value opportunities.
To ensure that this approach is adopted across local government.
What examples exist of this approach?
This is a tried and tested methodology used by authorities across the country in liaison with their Improvement and Efficiency Partnerships and the NIEP.
For examples see:
How scalable is this opportunity across England?
The framework approach is now being adopted by the seven Metropolitan Councils (which represent over 50% of the regional construction spend totalling over £700 million p.a.). This is being led by Birmingham, who previously had implemented a nationally acclaimed and award winning project.
Which tier of councils would use this and at what approximate implementation cost?
All tiers of local government would be able to access these frameworks.
Other resources/links to supporting documents/case studies etc.

Key contact:
Peter Parkes
Head of Property Services
Worcestershire County Council
T: 01905 766400
E:
W: / Andrew Peasgood
Framework Manager
Worcestershire County Council
T: 01905 822037
E:
W: