In N. Ireland methodologies on the procurement of design, where lowest price is no longer the determining factor have now been agreed between the Central Procurement Directorate (CPD), the RSUA & the construction sector (announced Sept. 2018). This halts the race to the bottom.
Under the pilot all construction services contracts to be awarded by CPD, both above and below the EU threshold, will be awarded in one of the following ways:
- Projects with no quality assessment at tender stage will be awarded based on the Mean Narrow Average calculation;
- Projects with a quality and price assessment at tender stage will base the price score on the Mean Narrow Average calculation; or
- Projects with a fixed fee tender will be awarded on the assessment of quality only.
The first CPD procurement using the Mean Narrow Average is currently at prequalification stage.
Mean Narrow Average
In a move to ensure value, the fundamental shift is that the best price will no longer be the lowest price but the price that is closest to an average. The average that will be used is a ‘narrow average’. The lowest price and highest price are not part of the calculation to establish the ‘narrow average’.
Full details of the Mean Narrow Average calculation are available here. Those interested in bidding for CPD projects are strongly advised to review this and ensure they fully understand it.
For all in construction, and design professionals in particular this is surely an extremely welcome and long overdue step.
But this is not the only one of the advances being made in the UK nations -N. Ireland, Scotland and Wales have all now also adopted Project Bank Accounts although from different threshold values.
Isn’t it now time for England to advance, reform and follow suite?