Offsite presumption: Procurement figures revealed

5th November, 2019

Three of the five government departments that committed to prioritising offsite construction by 2019 did not award any contracts with an offsite component in the first eight months of the year.

In November 2017 the government announced a 'presumption in favour of offsite', with the departments overseeing defence, education, health and social care, justice and transport committing to favour tenders with an offsite construction component before now. This began in earnest at the start of this year.

Freedom of information responses show that the health, transport and defence ministries procured no contracts with an offsite component in the first eight months of 2019, while the Ministry of Justice awarded just one.

By contrast the Department for Education has awarded 22 contracts so far this year, all of which were through dedicated offsite frameworks.

In June it also launched a £3bn modular schools framework for England.

A spokesman for the Infrastructure and Projects Authority who responded to CN's enquiry on the issue said real progress is being made, and that the government wants to work with industry to increase the number of projects delivered through modern methods.

Reacting to CN's findings, a Laing O'Rourke spokeswoman called for a more consistent approach from the government.

She said: "While it is encouraging to see that the Department for Education has been leading the way in integrating modern methods of construction, progress has been slow in other departments and we need a better overall procurement approach to be more consistently adopted across all departments.

"This will require a change in current practice, culture and behaviours starting with client organisations."

Rory Bergin, head of sustainable futures at design consultancy HTA, echoed the call for a change in procurement policy but also suggested the departments' lack of offsite procurement might be due to a lack of appetite from industry.

He said: "Contractors don't want to adopt offsite because for many of them it takes away a big chunk of their margins, sometimes as much as 70-80 per cent of the project."

Construction Innovation Hub director Keith Waller, who also sits on a government working group on modern methods of construction, said that he was aware of a number of departments actively looking at offsite construction in their future procurement.

He said that the DfE is able to procure from a large central programme, meaning it is able to switch to offsite methods.

He added: "With the offsite presumption, it said 'by 2019', and the argument might be that it's still 2019.

"It's the right thing not to rip up an ongoing framework to start then back-fitting something that hadn't been procured that way. But for future frameworks, it's important that they're incorporating those offsite principles in there."

An Infrastructure and Projects Authority spokesman replied on behalf of the government on the issue.

He said: "The government is committed to increasing the use of digital and manufacturing techniques in construction and using its buying power to drive innovation and increase productivity.

"Real progress is being made in this area and we will continue to work with industry and researchers by providing funding to help ensure more projects in the UK are built using these cutting-edge approaches."

Last month the government said it had no plans to require the use of modern methods of construction in publicly-funded housebuilding programmes.

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