6.42 The Banwell Report indicated that there was scope for awarding contracts in certain circumstances without competition to contractors who had shown particularly good performance on behalf of clients. Such "serial contracting" or "negotiation" is especially suitable where it represents a follow on stage to a previous contract, either on an adjoining site or as a logical sequence to it. Public sector clients will need to follow EU procedures, where appropriate.
6.43 It is possible to go further, and for client and contractor to enter into a specific and formal partnering agreement. This is a contractual arrangement between the two parties for either a specific length of time or for an indefinite period. The parties agree to work together, in a relationship of trust, to achieve specific primary objectives by maximising the effectiveness of each participant's resources and expertise. It is not limited to a particular project.
6.44 Such a system can be very effective in large programmes where it is desirable to build up expert teams and keep them together. Process plant and power station construction are particularly suitable, but there could be the use of such relationships in building as well. The DOE may wish to indicate to other public sector clients that such relationships could be beneficial and certainly deserve some experiments. The partner should initially be sought through a competitive process, which would be necessary to meet EU requirements.49
6.45 As a client organisation (some of whose members are instinctively wary of partnering in case it produces "cosy" relationships), the CIPS acknowledges in its final report that partnering has a place in procurement. "Partnering includes the concepts of teamwork between supplier and client, and of total continuous improvement. It requires openness between the parties, ready acceptance of new ideas, trust and perceived mutual benefit. Partnering can only be successful with the commitment of the Chief Executives of the organisations involved, and by the selection of individuals with a determination to work together. We are confident that partnering can bring significant benefits by improving quality and timeliness of completion whilst reducing costs. It can be applied to the construction industries through longer term agreements or option contracts."
6.46 Partnering arrangements are also beneficial between firms. Some main contractors have developed long term relationships with subcontractors. That is welcome. Such arrangements should have the principal objective of improving performance and reducing costs for clients. They should not become "cosy". The construction process exists to satisfy the client. Good relationships based on mutual trust benefit clients.
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49 Further details of partnering are available in "Partnering: Contracting without Conflict" published by NEDC, 1991, and "In Search of Partnering Excellence" published by the United States Construction Industry Institute, July 1991. See also paragraph 15.5 of the White Paper "Competitiveness - Helping Business to Win", HMSO, May 1994.