The Olympic project will be built by small businesses, so let’s have some genuine ‘construction commitments’ to allow them to get on with the job
John Armitt, chairman of the Olympic Delivery Authority, speaking at the Chartered Institute of Building’s annual dinner in February, disclosed construction’s worst kept secret – that the Olympic project will be built by SMEs. He added: “Failure is not an option and time is of the essence.” I sincerely hope this is a sentiment shared by everyone who has an interest in the future of the “real” and “virtual” construction sectors.
In my opinion, the 2012 Olympics offers both parts of UK construction the perfect (and maybe the last) opportunity to prove that we are still capable of becoming a modern, efficient and socially responsible industry.
Bob White, chairman of Constructing Excellence, has also expressed concern that the industry had regressed from the Latham and Egan reforms and fallen back into its old adversarial ways. This has been clear for all to see in the rapidly widening gap between the doers and risk-takers of real construction and the supervisors and regulators of virtual construction. Since the effective breakdown of the Construction Confederation and the associated decline in its influence, the industry has been represented by virtual construction at real construction’s cost.
The SMEs of real construction, who “produce 90% of site delivery”, to quote Sir Michael Latham (7 March, page 40), have been effectively disenfranchised from the industry’s consultation, lobbying and regulatory bodies. The people upon whom virtual construction relies to construct our buildings are no longer even consulted about the regulations and penalties that have a direct effect on the survival of their businesses. They are not happy bunnies.
Over 15 years, they have watched various government-sponsored “initiatives” come and go that have brought little practical benefit to real construction. So there’s a groundswell of distrust of anything “virtual” and their politically correct initiatives.
This leaves the ODA with the potentially big problem of attracting sufficient competent SMEs to work under the well-publicised 2012 Construction Commitments. For political reasons these must clearly remain in place, but how can sceptical SMEs be convinced that they won’t be taken to the cleaners? I strongly recommend that the ODA imposes strict rules of conduct on the consultants, supervisors and service providers on all Olympic projects regulating their practical and ethical performance. For instance:
• Every project should be fully designed, specified and double-checked for co-ordination, buildability, errors and omissions before the prices are confirmed and any contract or subcontract is signed.
• There should be a guaranteed four to six weeks lead-in period prior to commencement.
For political reasons the 2012 commitments must clearly remain in place, but how can sceptical SMEs be convinced that they won’t be taken to the cleaners?
• Signed contract drawings should be the working drawings. No “post-contract signing” client or designer changes should be allowed.
• Should design errors slip through, designers and contractors should resolve them together. Any additional cost must be agreed before any work commences and paid in full in the next stage payment immediately following completion of the work.
• As the project will be fully pre-designed, with all information available and no variations, the complete project can be totally pre-planned and run precisely to programme. A payment schedule stating monthly payment dates should form part of the contract documents. There should be no retentions, so monthly payments will be made in full by standing order on the pre-agreed days.
• The final account should be agreed and the final payment included in the pre-agreed standing order schedule within one month of completion.
• All the designers, contractors and specialists should guarantee that their work is defect-free as it is completed.
Such rules only confirm what any efficient and responsible designer or supervisor strives to achieve. Nothing more is being asked of virtual construction, than what its practitioners are already paid to do. If this type of commitment were extended to cover the whole industry, we could well achieve that cultural step change that has evaded us for 20 years.
Colin Harding is chairman of the G&H Group