Member Article

Industry body launches charter for change within regional construction

Construction Alliance Northeast (CAN), which was officially launched a year ago to represent the interests of over 500 SME companies in the regional construction and contracting sector, has launched a Construction Charter.

The aim of the charter is to create awareness about the need to re-think public procurement strategy so that regional SMEs get a better chance to compete for contracts in the open market.

Intent on highlighting the need for organisations to adopt ‘intelligent procurement practice’, the charter sets out a six point plan for public sector procurement reform, highlighting the need for a greater focus in tender documentation on increasing local contractor participation as well as the inclusion of social, economic and environmental considerations, particularly on carbon footprint reduction and the eco benefits of using regional rather than national contractors.

Training, job creation, apprenticeships and best practice in line with national examples are also cited as important areas within any regional tendering process to ensure that local SMEs are not excluded by tightly drawn selection criteria, which in the past, have focused on high turnover and a track record of similar framework experience.

Commenting on the development of the charter, Jeff Alexander, chief executive of CAN, said:

“During the recession many regional construction businesses were badly affected by the lack of private sector development. At the same time, the shift in public sector procurement practice resulted in national and large regional framework agreements for publicly funded projects and many of the region’s long established smaller and medium sized construction firms as well as tier one consultants were locked out. Some went out of business. With the new Construction Charter we have developed, we hope to ensure this situation does not arise again.

“The companies CAN represents have a combined turnover of some £3 billion and employ in excess of 10,000 people. Between them they are in a prime position to make a significant contribution to regional GDP. Given the recent forecast for construction output and the opportunities generated by the UK leaving the EU, there is a chance for rules on public procurement strategy to be urgently reviewed so that there is more of a level playing field for regional companies.”

One of the biggest opportunities for SME contractors regionally is to secure a place on the North East Procurement Organisation’s (NEPO) Building Construction Framework and its related supply chain, which is due to be re-tendered in May 2017.

Ken Parkin, a CAN committee member and construction specialist, has been welcomed by NEPO as CAN’s representative in a liaison role in the redesign of its tender documentation for the new construction framework so that it reflects more intelligent procurement practice and to provide input to the process from a wide range of regional companies.

NEPO’s Michael Curtis, Regional Category Specialist for Construction, has been keen to work with CAN and other regional bodies to ensure that the next framework advertised provides an opportunity for companies of all sizes. NEPO began a period of extensive consultation in October last year and is taking on board much of the industry feedback it receives in developing the next tender.

He said: “In addition to working with CAN, NEPO has undertaken market consultation to engage with, and listen to, the supply base. This has been invaluable and as a result, we will simplify evaluation criteria in order to open up the opportunity to regional firms and this should provide an opportunity to SMEs who obviously play a key role in shaping the economy in the North East.”

Mark Thompson, managing director of Ryder Architecture and North East Local Enterprise Partnership board member added:

“The North East LEP is fully committed to supporting the development of a multidisciplinary construction strategy for the region, which should support CAN’s Construction Charter at a regional level and look at all areas of construction-related skills. The North East Strategic Economic Plan highlights the importance of infrastructure, new homes and work space as a key driver for the North East economy and cohesive approach to construction is fundamental to achieving the SEP’s targets of creating 100,000 more and better jobs for the region by 2024.”

Jeff Alexander added: “From our own research with the 12 regional local authorities and other public sector bodies we know that some organisations are already taking steps to implement fairer procurement policies which put local companies first whenever possible.

“In this respect, Sunderland City Council has recently launched its own Construction Charter and expects all construction companies who secure contracts from the Council to fully comply with this charter. This is a really encouraging sign from a progressive local authority.

“Lessons must be learned from the past. North East England is perfectly placed to be a beacon of best practice and I would urge all local authority and public sector procurement teams to sign up to our Construction Charter to bring procurement back within the reach of regional companies.”

This was posted in Bdaily's Members' News section by Sarah Bosnyak .