Carillion’s Collapse. Lets learn lessons from this failure

Carillion’s collapse: Project Compass director Russell Curtis has called in ‘Let’s hope the lessons of Carillion’s failure will be learnt’, (AJ 17 January 2018) for “a more diverse supply chain to avoid another Carillion catastrophe, so we can face a future with a diverse, specialist and varied supply chain, which matches projects with proficiency and project scale with practice size.”

The growing crisis within the building industry shows that the driving policies and practices which are aggregating contracting into ever larger private contracts is simply failing, from the Edinburgh Schools fiasco, Grenfell and now Carillion’s collapse.

In UK procurement far practice greater regard now needs to be placed on the available provisions within Directrive 2014/24/EU and the Public Contract Regulations 2015 (noted in the informative below).  These provisions have to date been in effect disregarded in procurement within England.

Carillion’s Collapse

But Carillion’s collapse will most likely also have a devastating impact on a multitude of small sub-contracting firms and suppliers across the country, including architects.

But if payment security had been in place most of these anticipated losses would have been largely avoidable as money could have been secured.  This would have also better served to secure work flows better with less disruption through any administrative process.

Project Bank Accounts

Project Bank Accounts (PBA’s) provide such payment security. They ring fence funds for project payments in a client funded trust account, held independently of the main contractor, with payment cascaded out when work is discharged. PBA’s have been allowed within all public contracts since ythe transposition of Directicce 2014/24/EU & PCR 2015.  Scotland (for contracts above £4m), Wales and N. Ireland (for contracts above £2m) have now mandated their use and Highways England have adopted them.  However many may now ask why the use of Project Bank Accounts was not mandated across England, where there use has only been a ‘recommendation’.

Essentially the unfair apportionment of a contracts risk down through the multitude of small scale suppliers and sub-contractors, has been shown to leave those at bottom of this feeding chain more likely to be destroyed by such lack of payment.  It is these many smaller companies, the bedrock of the UK construction industry that may now go to the wall.  We have no doubts this could have a prolonged impact on industry capacity and skills.

RIBA adopted Project Bank Accounts in its procurement policy recommendations ‘Building Ladders of Opportunity’ in 2012 (1.2.5). It is now to be hope that with the support of members the institute will join with all other industry representatives in seeking there mandatory and early adoption.

Retentions Protection Scheme

With Carillion’s collapse retention payments withheld – as security in case of defects – will also have been lost. The Parliamentary Bill from Peter Aldous MP which passed its first hearing earlier this month for a Retentions Protection Scheme, modelled on the rent deposit protection scheme, is therefore equally important. Details HERE

Project Compass call on Parliament & Government

We therefore call upon all construction design professionals to petition their parliamentary representatives and call upon Parliament and the Government to:

  • Support the Construction (Retention Deposit Schemes) Bill known as the ‘Aldous Bill’ which passed its first reading on 9 January 2018
  • Legislate to require that PBAs are put in place for all construction works in England over £1 million.

 

BESA Building Engineering Services Association survey Jan. 23, 2018

The Building Engineering and Services Association (BESA) and the electrotechnical engineering survices trade association (ECA) survey of January 23, 2018 gives an early indication in this infographic of the scale of the problems now faced.

 

Informative: From the Public Contract Regulations 2015.

Under Regulation 46.(1), (2) and (4); contracting authorities may decide to award a contract in the form of separate lots and may determine the size and subject-matter of such lots; Contracting authorities shall provide an indication of the main reasons for their decision not to subdivide into lots, which shall be included in the procurement documents or the report referred to in regulation 84(1); Contracting authorities may, even where tenders may be submitted for several or all lots, limit the number of lots that may be awarded to one tenderer, provided that the maximum number of lots per tenderer is stated in the contract notice or in the invitation to confirm interest.

The division of contracts into more numerous lots is also a material consideration in the UK for improving social value and economic sustainability under The Public Services (Social Value) Act 2012.

Procurement threshold values from 1 January 2018

Procurement threshold values from 1 January 2018 for Public Contracts are revised. These revisions are biannual and are showing an increase in the GBP values due to fluctuations in exchange rates over the previous two years. These are the new threshold values which now apply generally in construction under the Public Contracts Regulations 2015. Small Lots are more fully described in PCR 2015 6 (14) (15) but occur where a defined public procurement is defined as otherwise taking place but lots within it may be excluded.

Services & Supplies contracts

Works contracts

Central Government

£118,133

(up from £106,047)

€144,000

£4,551,413

(up from £4,104,394)

€5,548,000

Other Contracting Authorities

£181,302

(up from £164,176)

€221,000

£4,551,413

(up from £4,104,394)

€5,548,000

Small Lots

under PCR 2015 6 (14) (15)

£65,630

(up from £62,842)

€80,000

£820,370

(up from £785,530)

€1,000,000

(With the exception of service contracts under Directive 2014/24/EU Article 74. Article 13 and R & D services under Article 14)

Although these do not so frequently apply within the construction sector, for the thresholds under the Light Touch Regime, thresholds for Social and other specific Services, and thresholds under the Concession Contracts Regulations 2016, Utilities Contracts Regulations 2016, and the Defence and Security Public Contracts Regulations 2011 please refer to Procurement Policy Note PPN 04/17

Open Call for the Venice Biennale 2018

PCompass Open Call for VeniceShort illustrated articles on your experiences of architectural competitions in Europe are invited for the Venice Biennale 2018.

This Open Call is part of a project that aims to improve architectural competitions and  design contests by appraising comparative performances, procedures and outputs across Europe to identify issues and best practices, for their improvement and reform. It  is part of the joint European programme on Competition Culture in Europe by Project Compass, Architectuur Lokaal and A10 New Architecture Co-operative to be presented in the Italian pavilion, Palazzo Widmann at Venice Biennale in May 2018. Outputs will also be available across Europe on thefulcrum.eu.

To submit please let us know, by writing to ProjectCompassCIC@gmail.com with no more than a 3 sentence outline about the subject area(s) you intend to address, at the latest by January 26, 2018. The final deadline for submission is March 2, 2018.

SUBMISSION DETAILS & REQUIREMENTS:

Word length:

  • 400 -1000 words
  • Not including the basic details set out below and any references.

Images:               

  • Min. 2 – Max 6 images. Plans & sections are particularly welcome. Please ensure and confirm the images are licenced creative commons use.

Subject Areas:

  1. Experiences collected from architects who have won Design Contests* abroad, to better understand the conditions that apply after a specific competition win in another country, including the benefits and obstacles. 
  2. Critical reflection by architects on substantive competition issues including their practices and outputs. For example architects are still consciously and frequently participating in bad competitions, it is not self-evident that jurors read the rules first and clients are failing to honour results. 
  3. Collecting data that contributes to misunderstandings and preconceptions in competition culture, including the commonly held beliefs that all problems arise from regulations.
  4. Collecting data into how, in each country, European, national and local laws and regulations are arranged, weighted and customised in competitions so as to provide insights on the benefits and disadvantages of the varied national applications. 

FOR FURTHER INFORMATION – SEE THE FULL SUBMISSION DETAILS AVAILABLE HERE PCompass Open Call for VeniceWe look forward to receipt of your submission(s) to this Open Call for the Venice Biennale 2018

Architectuur Lokaal logoA10 new architectural cooperative

Project Compass Newsletter December 2017

Newsletter December 2017

The Project Compass Newsletter December 2017 highlights some of our activities  over the past 18 months, the publications that have been output, a procurement trends report and our anticipated future activities.

Information on our exciting programme and the range of new activities we plan may be of particular interest to all our supporters and site users.  We welcome your participation, collaboration and engagement in some, or any of these, and particularly any contributions towards the Venice Biennale 2018 works. Submission information on this will be made available shortly.

Other activities of interest include the development of more and better engagement in educational modules and our Guerrilla Competitions programme.

As an organisation promoting open access and engagement we always remain open to advancing projects that may be brought forward to us by others, so long as they lie within our Community Interest Company remit. If you have any projects, programmes or ideas which you individually wish to advance, please talk to us or email us at projectcompaccCIC@gmail.com

Peter Aldous MP’s Jan. 2018 Bill to protect retentions

Peter Aldous MP will introduced a Parliamentary Bill on 9 Jan. 2018 to protect cash retentions in a retention deposit scheme (similar to a tenancy deposit scheme). Project Compass invite you to write to your local MP to express your support for this.

This is an important initiative being promoted by the Specialist Engineering Contractors Group (SEC) Group and their full briefing paper is published below.

Retentions withheld unduly in construction contracts are a significant concern for all in the construction industry including design professionals, whether they are withheld for excessive time or because a contractor goes bankrupt. It has an adverse impact on all and particularly SME’s in the supply chain.

This Parliamentary Bill aims to secure much needed reform.  We hope you will help to advocate this change by writing to your MP in support.  A letter template for your use is also provided HERE.

FULL TEXT OF THE BRIEFING PAPER PREPARED BY SEC GROUP.  November 2017
Continue reading “Peter Aldous MP’s Jan. 2018 Bill to protect retentions”

Call for ‘bottom up’ enablement by regulatory clarity

Following investigations into London’s Garden Bridge nineteen architects have written to the Chair of the GLA Oversight Committee, calling for better ‘bottom up’ enablement of public services through regulatory clarity.

“There is now little motivation for design professionals to initiate and nurture projects from inception as almost invariably the original designers will be preclude as the established competition processes are highly restrictive.

This effectively ‘locks out’ many of those who would be particularly well placed to support ‘bottom up’ endeavours, whether for example through the engagement of design professionals with their communities or by creating imaginative and valuable design ideas contributing to the city’s wider needs, vitality and wellbeing.”

The proposals tabled would “..allow all to benefit from the positive and creative endeavours of those developing built environment ideas for public good.

“London has many challenges and it is clear that we need to find a way that will encourage design professionals to come forward with ideas and to engage with communities in order to meet these challenges, and for client bodies to know they can access those ideas and benefit from the knowledge and work already carried out.”

Continue reading “Call for ‘bottom up’ enablement by regulatory clarity”

Public Interest Challenge & Garden Bridge

Public Interest Challenge & Garden Bridge Oversight. Transcribed below is a letter submitted by Project Compass to the GLA Oversight Committee calling upon them to consider better regulatory policing by means of a Public Interest Challenge for framework procurements, in specified circumstances.

“Dear Len Duvall,

Further to the recent GLA Oversight Committee mtg. of 11 October ‘17  where you called for exploration of future procedural improvements in TfL and the authorities procurement, on behalf of Project Compass CIC I am writing enclosing a proposal for your committees consideration and recommendations forward, along with a supplementary informative.

  1. Under the Public Contract Regulations (PCR) 2015 challenge of unprofessional procurement practice is available to those bidding who are defined within strict limitations as ‘economic operators’ and such challenge may only be within a constrained timescale.

For commercial reasons this can be particularly problematic for private firms, especially when they may seek further work from the awarding authority and that authority has a large and/or dominant market position. In effect they are captured. Pragmatically this conflicts commercial firms, and can in the case of the Garden Bridge procurement and other case study evidence we have researched lead to unprofessional procurement outcomes lacking transparency.

We would propose in future, within the standing orders and governance of a TfL or London wide remit, or by the national provision of a Procurement Policy Note (PPN) or in the longer term by reform of PCR 2015, that consideration might be given to the provision of a Public Interest Challenge, when poor procurement practices become publically apparent.

In this way a higher bar of accountability could contribute towards improving transparency and further professionalising practices to provide better, more effective and efficient procurement. This could address those aspects of the apparent conflicts in the existing procurement regulations.

Our thoughts on how the principle of allowing a public interest challenge might be embodied are set out below……(Letter Items 2 & 3 redacted here)

…. I trust the enclose maybe of value in informing best practice forward.

Kind regards

Walter Menteth

PUBLIC INTEREST CHALLENGE PROPOSAL – NOTES:

……..

It is the definition below which largely appear to preclude a ‘Public Interest Challenge’

PCR 2015 Clause 2(1) Definitions:

“economic operator” means any person or public entity or group of such persons and entities, including any temporary association of undertakings, which offers the execution of works or a work, the supply of products or the provision of services on the market;

PCR 2015 Chapter 6:

Clauses 88 (2)

In regulations 89 and 90, “economic operator” has its usual meaning (in accordance with regulation 2(1)), but in the other provisions of this Part “economic operator” has the narrower meaning of an economic operator (as defined by regulation 2(1)) to which a duty is owed in accordance with regulation 89 or 90

Clause descriptions/definitions however might possibly be clarified by means of a Procurement Policy Note, or within the local GLA or TfL remit by governance/standing orders or ordinances are set out below:

Clause 89(2), 91 (1) The definition of ‘an economic operator’

Proposal: ‘an economic operator which, in consequence suffers or risks suffering, loss or damage’ shall mean the public or their representatives.

Clause 92 (4) & (5) Discretionary extension of the time limit for actioning proceedings.

Proposal: The court shall be required to consider the timescale in which the public or their representatives might reasonably have become conscionably aware.

Clause 93 (5) (b) a summary of the relevant reasons

Proposal: ‘relevant reasons’ shall mean reasons that are evidentially substantial and relevant to the notified award criteria assessed in accordance with these regulations.

Clause 94(1)to(5), 98 (2)(c), 99(c), 102 (6)  The definition of ‘any economic operator’

Proposal: The definition shall have the same meaning as that proposed in clause 91(1) (above)

The key principle being to allow the possibility of a public interest challenge!”

 

‘Competition Culture in Europe 2013-2016’ published.

‘Competition Culture in Europe 2013-2016’ is a new publication resulting from a pan-European survey executed by Project Compass CIC, Architectuur Lokaal and A10 new European Architecture Cooperative.

Continue reading “‘Competition Culture in Europe 2013-2016’ published.”

Ten steps to improve architectural competition culture in Europe

Conference ‘Competition Culture in Europe’, group portrait. Sept. ’17;  Photo: Eva Kasbergen

|Palazzo Widmann at the Venice Biennale, May 24, 2018|

Last week Architectuur Lokaal with Project Compass organised the first, two-day conference on Competition Culture in Europe in Amsterdam. The results of a comparative research study of 17 countries was presented and extended with knowledge from other countries. The conference represents the start of a four-year project to improve the accessibility and transparency of competitions in Europe. The conference concluded with agreement being reached by representatives from over 25 countries to embark on the following programme over the next year.

Continue reading “Ten steps to improve architectural competition culture in Europe”

Design Contest Portals, by country

Design Contest Portals from thirty three European countries that announce architectural design contests and competitive opportunities are now published on thefulcrum.eu .

Open International contests, private contests and opportunities below OJEU thresholds and can also be found through this unique public listing

Produced as part of the four year programmeCompetition Culture in Europeand issued accompanying publication of Competition Culture in Europe 2013-2016, the list makes information more accessible for those seeking to engage.

We will continue to update this list but if you know of a country or a website that is missing, please notify us by email. Many of the results are also included along with the many opportunities and other insights now available.

the independent European portal for architectural competitions & contests.