{"id":88785,"date":"2021-02-10T07:00:33","date_gmt":"2021-02-10T07:00:33","guid":{"rendered":"https:\/\/www.pbctoday.co.uk\/news\/?p=88785"},"modified":"2021-02-09T15:07:09","modified_gmt":"2021-02-09T15:07:09","slug":"public-sector-contract","status":"publish","type":"post","link":"https:\/\/www.pbctoday.co.uk\/news\/planning-construction-news\/public-sector-contract\/88785\/","title":{"rendered":"Contractors will face \u2018intense scrutiny\u2019 if they submit low bids"},"content":{"rendered":"

Contractors will face \u201cintense scrutiny\u201d if they submit unrealistically low bids for public sector contracts, according to a senior official at the BEIS<\/h2>\n

Fergus Harradence, deputy director for infrastructure and construction, told a webinar hosted by the Building Engineering Services Association<\/a> (BESA) that any unrealistically low bids for public sector contracts will be rejected unless the bidder has a plausible explanation.<\/p>\n

Harradence told BESA chief executive David Frise that the new procurement rules contained in the government\u2019s \u2018Construction Playbook<\/a>\u2019 were designed to \u201creset the government\u2019s relationship with the industry because at the moment it is not working for either party\u201d.<\/p>\n

Unrealistic bidding means the government does not get the quality projects it wants, and the industry suffers from low margins and lack of investment.<\/p>\n

It can also lead to poor payment practices and unfair contract conditions that pass on too much risk to suppliers, added Harradence.<\/p>\n

\u201cWe need to get away from a situation where people are only able to make a profit by putting pressure on their supply chains\u2026that is what led to Carillion<\/a>,\u201d he said.<\/p>\n

\u201cWe need the industry to behave responsibly and embed the rigorous comprehensive approach to quality that has been so successful in manufacturing.\u201d<\/p>\n

\u2018Honesty to avoid problems further down the line\u2019<\/h3>\n

He said the playbook depended on everyone being more \u201copen and honest with each other\u201d and that government would prefer that projects appeared to cost more from the outset to avoid problems further down the line.<\/p>\n

The\u00a0Playbook\u00a0was developed by the Cabinet Office in partnership with the construction industry and sets out how the government aims to achieve project delivery that is \u201cfaster, better and greener\u201d.<\/p>\n

\u201cThe fundamental principle is that contracts should be profitable,\u201d said Harradence. He also warned clients against issuing incomplete tender documents<\/a> with poorly defined specifications, which increase the risk for bidders.<\/p>\n

\u201cWe are starting from the basis that we want to do things differently. This persistent under-bidding for projects leads to ministers having to stand up in parliament and apologise for projects running over time and budget,\u201d he told the BESA webinar.<\/p>\n

He said too many clients were being given totally unrealistic expectations about how much a project would cost, which led to disputes and project over-runs.<\/p>\n

\u201cThere has to be a greater level of trust between the industry and its clients \u2013 this is absolutely pivotal. Without that trust, the process will run into the mud.\u201d<\/p>\n

Harradence confirmed that anyone who underbid would face a detailed interrogation. \u201cIf they have a good explanation that\u2019s fine, but it is better for projects to appear to cost more \u2013 than us having to go cap in hand to the Treasury for more money further down the line.<\/p>\n

\u201cWe need to spend more time and money at the start of the process to get the design right. That will give clients greater reassurance that they will get the quality asset they need \u2013 and BIM can support that by giving a realistic production schedule and more transparency.\u201d<\/p>\n

\n<\/div>","protected":false},"excerpt":{"rendered":"

Contractors will face \u201cintense scrutiny\u201d if they submit unrealistically low bids for public sector contracts, according to a senior official at the BEIS.<\/p>\n","protected":false},"author":16,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[304],"tags":[712,24813,824,676,276,639],"stakeholder_rel_tag":[],"contributor_rel_tag":[],"class_list":{"0":"post-88785","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-planning-construction-news","7":"tag-besa","8":"tag-building-contracts","9":"tag-carillion","10":"tag-construction","11":"tag-government","12":"tag-procurement"},"acf":[],"yoast_head":"\nContractors will face \u2018intense scrutiny\u2019 if they submit low 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