Procurement contracts and processes present a major opportunity for reform to address industry-wide grievances.
Frequently, governments use contracts that are labelled 'standard', however are actually bespoke. Contract uniqueness can lead to interpretation issues and contract management failures.63 The situation is often compounded by requests for industry to respond to tenders within unreasonably short timeframes. Furthermore, it is rare for costs associated with bids to be directly recoverable.
Current tendering practices have compounding effects from the contractor to the supply chain. In the long-term it erodes industry confidence and may deter bidders.64 This reduces competition, so taxpayers pay more for the infrastructure.65
Governments can lead change as model clients.
For example, bidders should be able to recover some of the bid costs from governments where they are unsuccessful. Alternatively, governments can arrange the tendering and bidding process to reduce the bidding pool sooner or can utilise FEED processes to reduce risk so as to ensure the contracting market avoids unnecessary costs.
Both these approaches will create a more positive environment and mitigate attempts by the contractor to recover costs elsewhere.