It’s time to prove that the industry can deliver the 10-20% savings the government wants – but there are some major obstacles to overcome
It might not feel like it to those firms whose workloads halved when the £55bn schools building programme was axed, or whose order books were left in limbo after the shake up to the housing system – but construction could have fared worse over the past nine months in the battle to bring public spending down.
Last year, the government asked its major suppliers from the support services sector to give hefty discounts on public sector contracts. Officials could have made a similar proposition to construction firms, but didn’t. Partly because to do so would be more complicated for construction projects, and partly because they were persuaded by those, including chief construction adviser Paul Morrell, who said that construction could offer even greater reductions by reforming the way it works.
Now the time has come for the industry to make good on that claim. It must either deliver the 10-20% savings the government wants through the methods it wants – standardisation, better procurement and improved whole-life value – or run the risk that clients will respond by demanding a direct price cut and a hit to margins.
A partnership of architect and contractor should be able to produce off-the-shelf schools and clinics. In practice, this is going to entail a huge shift
The construction industry, in general, seems confident the savings can be achieved (see analysis). But in order to get there, firms are aware there are some major obstacles to be overcome. From an industry perspective, chief among these is the question of standardised design.
In theory, a partnership of architect and contractor should be able to produce off-the-shelf schools and clinics that can be adapted to local sites. In practice, this is going to entail a huge shift. Architects must learn to embrace standardised design not only for component parts but also for whole blocks or buildings. The relationship with contractors needs to be much more integrated so these designs are practical for off-site manufacture – the most obvious way to bring down costs on top of reducing the time spent developing bespoke designs. There also needs to be realism about the finished product from both architect and client.
There are other ways, too, in which the government will have to assist the industry to meet its challenge. The most pressing is to decide where its priorities lie when its political objectives clash. Localism, for example, does not sit well with the use of national frameworks to drive down procurement costs, and nor does it go hand in hand with asking clients to choose from a selection of standardised building designs. There’s a similar problem with planning reform.
These contradictions have already been grappled with by the Sebastian James review into schools procurement, which is expected to be published imminently after a lengthy delay. Among its conclusions, the review is expected to acknowledge the need for a central body to procure school buildings. It’s the sensible result, but when you ask why it took so long to reach, it’s a sure bet that the pressure to devolve as much responsibility as possible to local communities must have played a part.
The industry needs to act quickly to make the savings the government wants. But to do that, it needs to be clear on what standard of product it is expected to deliver – and to whom.