Keeping an eye on sustainability during the credit crunch shouldn't be too hard, with the help of the JCT's new guidance note
Sustainability is a perennial issue and acting sustainably has, until recent years, been a natural part of our lives. However, as world activity grows and the pace of change increases there comes a need for greater intervention by policy makers, trade bodies and individuals to ensure sustainability performance, so we do not ruin the prospects for future generations.
The JCT recognises this need. Following an industry-wide consultation, it published Building a Sustainable Future Together, a guidance note which is principally concerned with how sustainability in design and construction is provided for in contract documents. It also includes new contract clauses that extend those currently in JCT contracts, such as the Framework Agreement. The two principal new clauses are:
1) The contractor is encouraged to suggest economically viable amendments to the employer's requirements which, if instructed as
a variation, may result in improvement in environmental performance in the carrying out of the works or of the completed works
Most of the cost of a project is determined in the initial stages of design; it is the same with sustainability
2) The contractor shall provide to the employer all the information that he reasonably requests regarding the environmental impact of the supply and use of materials and goods which the contractor selects.
These clauses are supported by provisions dealing with performance indicators and value engineering as these, if not essential, are beneficial.
The JCT is attempting to provide a contractual framework that will be a constant reminder of the need to address sustainability. The framework recognises that contract conditions play a part but also that documentation will deal with sustainability in other ways, such as specification and drawings. It also acknowledges that each project is unique and each client may wish to set different requirements.
Most of the cost of a project is determined in the initial stages of design; it is the same with sustainability. Decisions on sustainability arise both in the design and in the construction processes but the former will invariably have the greater impact. Consequently, the procurement route will determine the sustainability provisions contained within the respective contracts.
The reduced level of work that will follow from the restriction on credit will, of course, mean greater competition among firms
These different approaches and the importance of designers and builders getting together early in the design process are facilitated in various ways, and one such way is the use of JCT's Pre-Construction Services Agreements. Those agreements enable the supply chain to be involved at an early stage and, if properly used, will help in achieving higher-level sustainability objectives.
When JCT started its consultation the credit crunch was in its infancy but since then it has taken a firm grip and the effects of this are increasingly noticeable. There are suggestions that, notwithstanding the bringing forward of public sector projects, the construction industry will reduce by 9% during 2009 and not return to 2007 levels until around 2013: this may even be optimistic. Against that backdrop, many in the industry may disregard sustainability matters (or at least lower their priority) and be concerned much more with securing work. If that were to be the case Building a Sustainable Future Together could fall on stony ground, but I do not believe it will, nor do I believe that one should turn one's attention from sustainability because of the current economic circumstances.
The topic is far too important to ignore and arguably getting to grips with it will provide a competitive edge, not just for individual firms but for UK firms as a whole - the new US administration has already indicated that it might look to Europe for advice on green buildings.
The reduced level of work that will follow from the restriction on credit will, of course, mean greater competition among firms, and those that have little or no regard for sustainability are likely to find work harder to come by; margins will be squeezed and procurement approaches may change. But the driving force for sustainability will be the fact that it is about the future and our survival. Also, the idea that sustainability always costs more is erroneous. There are many examples of solutions that offer improved sustainability which have saved both capital costs and revenue expenditure. For those worried about securing work perhaps this alone is sufficient incentive not to ignore the issue.
Peter Hibberd is secretary-general of the JCT