Are we going to be PC?

What do you understand “PC” to mean? Police constable? Prime cost? Politically correct? Partial completion? Part-time construction? The answer in the construction industry these days increasingly seems to be “prime contracting”. But what exactly is prime contracting? A straw poll at a recent gathering of architects and engineers failed to elicit a confident response: “Isn’t it something the MOD is doing?” … “Sort of like design and build, isn’t it?” … “Isn’t it the new tendering process that government departments are going to use?” … “I’m not sure, but I believe it’s a sort of ‘one-stop shop’ procurement process.”

Now, all of these people had heard of prime contracting and all of them had at least grasped a part of the plot. But for a system that is intended to revolutionise the way construction is procured in this country, it seems a tad surprising that these construction professionals knew so little about it.

I don’t pretend to be an expert in this field (other contributors to this magazine have a much better understanding of the subject), but I do see that if prime contracting takes off, it could have a profound effect on how we build.

There is a big “if” there. Construction goes through phases just like any other industry.

I don’t just mean a fashion for wave-form roofs or structural glazing, but trends in procurement processes and management styles as well. There continues to be a proliferation of contractual forms out there. Yes, JCT80 is still going, but there was a time in the 1980s when clients turned to management contracting as the only sensible way forward. It had some advantages, certainly, but then this trend metamorphosed into construction management, which became the flavour of the month for a while.

Taking on a prime contract means taking on risk, and that’s not something consultants do

Design and build has always been popular in certain sectors, with many clients convinced that this was the only economic way forward. These days, all major projects seem to have a customised contract, pored over for days by teams of lawyers as clauses are tweaked and tuned, each client demanding tailor-made agreements for each project.

Then there’s partnering – a great idea to quicken the process and control budgets by buying in the expertise of all contracting parties right at the beginning. But does it work? If partners are “dropped”, does that mean it isn’t working? And who is to blame for the failure? Why hasn’t partnering been actively embraced by a greater number of large clients? I don’t know – perhaps someone would like to ask BAA?

And what about prime contracting? What will it mean to consultants? A prime contractor undertakes to deliver a product (whether it is a warship or an office building) to a given budget, timescale and quality. The underlying premiss is that, by awarding a contract to a single entity that brings together the whole supply chain – materials suppliers, subcontractors, managers, specialist consultants – economies can be achieved in time and cost. Contractors have already seen the opportunity it presents and are offering themselves to clients as multitalented, multidisciplinary outfits that can do it all, as one-stop shops that simply build on experience and formally acknowledge working relationships with preferred supply-chain members.

To architects, consulting engineers and quantity surveyors, however, the prime contracting tag cannot be so readily attached. Taking on a prime contract means estimating the cost of the project, assessing opportunities for profit, making a bid for the work and then taking on the risk, and that’s not something consultants do. They consult, they offer professional advice, based on knowledge and experience, for a fee. Whether that fee is a fixed sum of money or fluctuates according to any number of factors is immaterial; it is still a fee paid for services rendered. So, if consultants want to be involved in prime contracting (and that’s another big if), they will need to team up with other players that are experienced at taking and managing risk.