Construction Professional

20 years of best practice on procurement has been enshrined in a new British Standard. Will Hughes outlines why it should be widely adopted

New standards for construction procurement

A FEW YEARS AGO, a series of specialist workshops, under the heading “Rethinking Standards in Construction”, were sponsored by the then Department of Trade and Industry, later succeeded by the Department for Innovation, Universities and Skills. These were organised by the British Standards Institution (BSI) and Constructing Excellence in the Built Environment (CE). The main conclusion of the workshops was that there was real potential for a new standard on construction procurement, based on guidance that had been developed by the Office of Government Commerce, among others. Even so, the move towards a British

Standard was particularly welcome as a means of ensuring that such guidance has a broader base, independent of the life cycle of contemporary representative organisations and stakeholder groups. This was the background that resulted in the publication last year of a new British Standard, BS 8534:2011 Construction procurement policies, strategies and procedures — Code of practice. Meanwhile, the International Standards

Organisation (ISO) was independently drafting a standard related to construction procurement, with a focus on tendering. Various international bodies have developed their own approaches to tendering for major construction works, and the ISO felt that this caused too much confusion and complexity. ISO 10845 was developed to help

procuring organisations develop generic procurement systems and organise tendering processes that are fair, equitable, transparent, competitive and cost-effective. The group working on the British Standard commented on and contributed to the development of ISO 10845. This international standard is now also a British Standard, in two parts: BS ISO 10845-1, Construction procurement — Part 1: Processes, methods and procedures; and BS ISO 10845-2, Construction procurement – Part 2: Formatting and compilation of procurement documentation. The distinction between ISO 10845 and BS 8534 is that the former is focused on developing a detailed framework for tendering and selection; the latter is

focused on the development of policies, strategies and procedures that underpin collaborative working in both public and private sector construction.

BS EN ISO 10845: Construction procurement ISO 10845 goes to considerable detail in setting out the steps and documentation involved in the tendering process. Without getting into the detail, the underlying principles that guide the work are: • Fair: Impartial and providing simultaneous and timely information, not prejudicing interests of the parties.

• Equitable: Non-award to a compliant bidder only if there are restrictions from doing business, incapability or incapacity, legality, conflicts of interest.

• Transparent: Procurement process and criteria for each project/programme to be publicised; decisions publicly available with reasons, and verifiable.

• Competitive: System provides for appropriate competition to ensure cost- effective and best value outcomes.

• Cost-effective: Processes standardised with flexibility to attain best value in

Sustainability back to basics: The Carbon Reduction Commitment

The CRC Energy Efficiency Scheme (formerly called the Carbon Reduction Commitment) is a mandatory UK carbon trading scheme aimed at improving energy efficiency and cutting emissions in large public and private sector organisations which are responsible for around 10% of the UK’s emissions. The scheme, introduced two years ago, requires that all participants — roughly those with annual energy bills of

26 | SEPTEMBER 2012 | CoNSTruCTIoN maNagEr

£500,000 plus — measure and report their carbon emissions annually. They must also buy allowances

from government each year to cover their emissions in the previous year. A publicly available CRC performance league table shows how each participant is performing compared to others in the scheme. There are heavy financial penalties for non-compliance. The purpose of the CRC was to drive

down UK emissions through the application of financial and reputational drivers, but its future is in the balance. The CBI has been campaigning to get the CRC scrapped and the Treasury doesn’t like it either. In June, DECC completed a consultation to try to simplify the scheme to make it easier to comply and we are awaiting publication of the results, but if this proves unworkable it could be scrapped.

The move towards a British Standard was particularly welcome as a means of ensuring that such guidance has a broader base