Government construction trials deliver cost savings

Aaron Morby 11 years ago

The Cabinet Office has hailed the success of several pilot construction projects to promote new approaches to procurement and cut waste.

A big thumbs up was given to integrated project insurance as a means of spreading risk across an integrated supply chain and winning big savings.

As part of the Government Construction Strategy, nearly 100 representatives from across government and industry, with suppliers of all sizes, met in London yesterday to share lessons from the trial projects and identify more opportunities to make savings and foster innovation.

Cabinet Office Minister Chloe Smith, said: “The construction industry is a vital driver for growth, sustaining thousands of SMEs.

“It’s therefore enormously important for government to work collaboratively with industry, identifying ways to make sure those links continue to foster innovation within the supply chain.

“It is only by sharing lessons learnt from these trial projects – which have already shown they can save money – that we can go even further to challenge the cost of construction, cut through unnecessary waste and streamline processes to get the best results at the best price within timelines.”

Working with both small and large suppliers has enabled government to test new ways to be more efficient, strip out waste and pay on time.

Construction efficiency pilot projects

  • The Environment Agency’s Rye Harbour project has saved time and 10% on costs by engaging early to encourage competition amongst integrated teams of suppliers who are selected on their ability to beat the target cost through innovative collaboration.
  • Surrey County Council/May Gurney’s Five Year Highway Programme has focused on sustainability to create a wider integrated supply chain, sharing their success with other authorities and their suppliers to increase use of recycled construction material in the South East.
  • Working with Balfour Beatty to build Enfield Oasis Academy, the Education Funding Agency has created six apprenticeships, targeted 60% of spend from the local supply chain and delivered a range of short-term placement and work experience opportunities for students.

Trevor Hursthouse, chairman of the Specialist Engineering Contractor’s Group, said: “The event is providing clients an opportunity to see how alternative and innovative procurement models adopted for trial are being applied.

“One particular approach, Integrated Project Insurance – which uses an independently assessed and verified Integrated Project Team and collaborative processes – provides insurance against project-wide risk and any unforeseen extra costs.

This reduces overall risk for all those involved including the many SMEs our group represents.

“Together with other innovative procurement models, IPI trials represent the Government Construction Strategy in action – real projects being delivered.”

Delegates at the meeting discussed the use of feedback-gathering ‘Information Hubs’, which focused on the three models of procurement – cost-led, integrated project insurance and two stage open book – as well as associated cross-cutting themes such as BIM, intelligent client and lean sourcing.

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