When do frameworks fail?

This review has considered concerns expressed by clients and industry as to the reasons why frameworks fail to achieve their intended benefits, and proposals as to the changes that will deliver improved results. In a complex web of construction sector activities and relationships, there is widespread frustration that the reforms needed to underpin efficient strategic construction procurement keep being postponed. Common themes raised by review participants include:

■  The large number of competing frameworks and the lack of objective standards to help clients and industry assess their merits

■  Lack of clarity as to the pipelines of work that are planned or committed to be procured under specific frameworks

■  The use of some frameworks as a shortcut to market, with limited machinery for framework level collaboration and value improvement

■  The cost and waste of creating and responding to onerous and inconsistent selection questionnaires and bespoke framework contracts

■  Complex performance measurement systems that are not used for rewarding excellence, awarding work or sharing improved practices

■  Limited understanding and adoption of digital technologies, MMC, ESI and whole life procurement

■  Limited commitments to strategic delivery of improved social value, net zero carbon targets and other environmental value

■  Poor communication by framework managers, including lack of feedback and lack of shared learning from framework initiatives and project performance.

Review participants are concerned by the large number of public sector construction frameworks, of which Build UK calculate that over 2,000 are currently active. The claimed value of frameworks often exceeds the amount of work actually on offer, leading to shortfalls in the value of the projects awarded to selected framework suppliers. There is significant wasted cost and time for clients and for bidders in procuring multiple, speculative frameworks that are not connected to specific pipelines of work.

There is a 20-25% chance of a supplier winning a framework project if the average success rate in framework bids is combined with the average success rate in call-off bids. Review participants report that, in addition to client procurement costs, the average bid cost for each major framework is over £247,000 for contractors and over £130,000 for consultants, with a maximum of up to £1 million in each case. If one in four bids are successful, then up to £4 million must be recovered before a supplier delivers any value at all. Ultimately, all bid costs are recovered from clients, and these costs can only be justified if they enhance the quality of frameworks and contribute to significant value improvements.