10.13.1 The fact that neither the building inspectors from Edinburgh Council nor either firm of Independent Certifiers, in line with their understandings of their own respective roles, carried out on-going inspections of the quality of construction at the level that is more normally undertaken by a Clerk of Works, meant that the Council were effectively totally reliant in this regard on the quality assurance procedures of ESP and their construction supply chain. In the case of the contractors this effectively meant marking their own homework. The amount of defective construction subsequently discovered demonstrates that unfortunately, any such reliance on self-marking by the construction supply chain was, at least in relation to quality of construction of the walls, on this occasion misplaced.
10.13.2 If one were to compare this procurement method with the more traditional model of public sector procurement, while not without its problems, the latter offers public sector clients a further level of assurance in that the architect and structural engineer, under that model directly employed by the public sector client, provide a degree of independent scrutiny of the quality of construction work throughout the construction process. This professional scrutiny would normally be supported, certainly on projects similar in size to the PPP1 projects, by the employment of experienced Clerks of Works and/or resident engineers, who would act as the permanent on-site eyes and ears of the design team.
10.13.3 In the PPP1 arrangement, as is the case in the Design and Build model that is increasingly the predominant model used by the public sector, the design team was employed by the construction joint venture, AMJV on Phase 1 or directly by Miller Construction on Phase 2. Under these arrangements, the primary contractual obligation of the members of the design team is to the contractor and the scope of their service, including whether or how often they attend site, is also determined by the contractor.
10.13.4 Unless a separate team is appointed to do so, public sector clients in this situation do not enjoy the benefits of independent inspections of the quality of the construction work by members of the professional team representing the clients' interests. Also with the move to Design and Build and PPP types of procurement, where the role of the design team is largely determined by the contractor, the unwillingness for contractors to pay for the presence of architects and structural engineers on site to inspect the work of the contractors employing them, has been reflected by a significant reduction over recent years in the level of this crucial activity undertaken on these types of project.
10.13.5 Of equal concern is the reduction by public sector clients in the direct employment or external appointment of Clerks of Works whose essential role in public sector projects has been to protect the quality of construction which represents significant investments of public funds.
10.13.6 It is the view of the Inquiry that such reductions in the core aspect of quality assurance on behalf of public sector clients is frequently a false economy.
10.13.7 It was reported to the Inquiry in evidence, as previously advised in this Report, that the approach of Edinburgh Council was based on an assumption that quality assurance in the delivery of the project was essentially the responsibility of ESP and that the Council should have a very limited role in this regard.
10.13.8 On that basis, no Clerks of Works were appointed to act on behalf of the Council on the PPP1 projects.
10.13.9 The representatives from virtually all the public sector bodies and the large majority of private sector bodies interviewed by the Inquiry, expressed concern at the ongoing reduction in the use of Clerks of Works in the construction industry and saw this as a contributory factor to problems of quality in the industry as a whole.
10.13.10 Specific instances in relation to the current delivery of public buildings in Scotland by approved major contractors were referred to in evidence to the Inquiry. Examples were given in which the Clerk of Works played a central role in identifying major failures in the quality of the construction of both the structure and fabric in new school buildings. A senior estates manager from the Local Authority in question stated in evidence:
"My experience has been that the level of inspection allowed for by the funders and the delivery company has been minimal. We have had to put in place our own directly employed staff and clerks of works to ensure the quality of construction and level of supervision that we require."
10.13.11 In the opinion of some of those who gave evidence to the Inquiry, rather than the increased use of 'Design and Build' leading to a better integration of these two fundamental aspects of the construction process, its use can lead to an artificial separation of design and construction and a potential deskilling of design team members as a result of their reduced exposure to experience on site. As one example of this, a Director of an established firm of structural engineers said in evidence to the Inquiry:
"I would also add that the supervision element of the engineer on site has almost disappeared in construction projects. Historically, we would have resident engineers on site but this costs money. In the past, this would have altered the mentality and approach of the contractor on site as they knew that there was somebody appointed by the client on site either all the time or very regularly watching what they were doing.
Our view is that the workmanship issues found on the schools has little to do with PFI, it is an issue to do with the construction industry more widely."
10.13.12 Similar views in relation to the impact of the reduced role of architects and engineers under the newer procurement models, in terms of their role in inspecting the quality of work on site, were expressed by the majority of professional consultants and professional client representatives who appeared before the Inquiry.
10.13.13 The Inquiry received a written submission from the Royal Incorporation of Architects in Scotland which included specific commentary on this issue. The following extracts were considered particularly relevant in relation to this issue by the Inquiry.
"The traditional position on inspection has long been that supervision of construction by the parties responsible for it is an essential first line of defence. Independent inspection by persons experienced in construction inspection, combined with effective sanctions in the case of non-compliance with standards, were always essential safeguards. Non-traditional forms of construction, if they remove or dilute the independent inspection role and the sanctioning authority of the construction inspector from the construction process, cannot provide the assurance of quality sought in public sector guides."
"Traditionally the ultimate sanction of an architect finding defective work, was to refuse to issue sums on an interim certificate which was required to authorise payment to the contractor. Where the architect is engaged by the contractor this is, of course, not possible."
"It is not uncommon for architects involved in alternative procurement projects to be advised that site inspection is not necessary, or that architects instructions, (by which contract works are varied traditionally) are not required."
10.13.14 Perhaps naturally enough the issue of a perceived constant pressure on reducing professional fees was frequently raised in evidence. The following is one example from the evidence of a Director at another established firm of structural engineers.
"With regard to the question of fees, inevitably your fee level determines how much time you are able to be on site. You want it to be done as best you can. Ideally, you would like to be there often, but fees remain tight. Nowadays, we are often encouraged to rely on emails or photos of the work being done and this type of shortcut does drive down fees.
When the fee is tight, things are compromised. Although our professional indemnity covers our design, we can't possibly guarantee the quality of workmanship on site."
10.13.15 There is a fundamental difference between the traditional and alternative forms of procurement, in terms of the nature of the relationship between public sector clients and design team architects or structural engineers. Public sector clients may assume that the involvement of these professionals in the project provides the same level of assurance in Design and Build or PPP projects as under previous forms of contract. This is not the case. These consultants owe their direct contractual obligations to their employers the contractors, who will normally ensure that all key correspondence from the design team goes to them directly for a decision as to how that information should be processed.
10.13.16 In evidence a Director of WSP Parsons Brinckerhoff, a major international firm of consultants and also the structural engineers who were responsible for the structural design of the PPP1 schools, in response to a general question on this issue, and specifically not referring to any situation at the PPP1 schools, explained his view of the relationship stating:
"If a structural engineer from our practice goes in and sees a lack of wall ties, under the terms of a Design and Build appointment, we would have discharged our responsibility if we were to inform the contractors. If we go back again and it still hasn't been done, then we would report it again. Under the terms of our appointment we would not report it directly to the commissioning clients. If it was a novation and a dual appointment where we were also retained by the end client, we would have a duty to report beyond the contractor as our clients."
10.13.17 A similar view was expressed by the Property Director from a Local Authority in Scotland;
"In my experience, if an architect speaks out then they risk not getting more work from main contractors. They will be reluctant to speak out in this way so for that reason we find ourselves being much more proactive because we know that there is this conflict."
10.13.18 The result of acting on a report of defective work from members of the D&B design team in such situations is likely to incur significant financial penalties for a contractor, either as a result of the cost of having to remove and rebuild the sub-standard work identified or as a result of the delay to completion this might cause. In such circumstances there is an inevitable conflict of interest which may impact on the judgement made by the contractor as to what actions are taken.
10.13.19 The experience of the Inquiry would strongly suggest that the majority of contractors will act with integrity in such circumstances and remove the defective work. However, evidence to the Inquiry has also suggested that there may be a resistance on the part of some contractors to have design team members inspecting the quality of the work on site for these reasons.
10.13.20 In the case of the PPP1 Projects the appointment of the architects, as provided in evidence to the Inquiry by Galliford Try, did require them to visit the site. It read:
"Attend site to determine the quality of workmanship and materials are being executed generally in accordance with the Consultant's design. The Consultant shall provide a written Report to the Contractor where he finds a material deviation from the requirement of his design."
10.13.21 Equally the appointment of the structural engineers had the following requirement.
"Make such visits to the site as the Consulting Engineer shall consider necessary to satisfy himself that as to the performance of any site staff and that the Works are executed generally according to the designs and specifications and otherwise in accordance with good engineering practice."
10.13.22 As previously mentioned in Section 9 of this Report, in the evidence from Holmes Miller, the architects for the PPP1 primary schools, it was stated that the architects had raised concerns with the contractor following site visits by them, with the contractor in relation to failing to comply with the specification requirement that stated:
"Raise no portion of the work more than 1.2 m above another at any time"
and that, as they had no power to instruct the AMJV/contractors to comply, this approach was carried on throughout the course of the various school projects.
10.13.23 The Inquiry is of the view that, if possible, there should be a mandatory provision built into such contracts that where a contractor fails to take appropriate action on issues that could impact on the subsequent safety of building users, the consultant in question should be required to inform the public sector client of the advice provided to the contractor.
10.13.24 If the commissioning client is also made aware of concerns expressed by members of the design team, the dynamic of the situation is quite different.
10.13.25 It is the view of the Inquiry that public sector clients should specify in their 'statement of client's requirements' any particular provisions they may wish to have incorporated into the scope of services to be provided by design teams in Design and Build arrangements, particularly in relation to the inspection of and reporting on the quality of construction and compliance with the approved design.
10.13.26 They should also require to see the conditions of appointment of the design team members to understand the comprehensiveness or otherwise of the services that the design team are being required to provide by the contractor.
10.13.27 The Inquiry was advised that in the case of the PPP1 projects as far as it was possible to say, the conditions of appointment and range of services to be provided by the design team were not requested by or provided to the Council Project Team.