Challenging times

Building has been writing about problems with the re-tendering of the government’s £750m project management and full design team services framework for well over a year now. Last month RLB chief executive Lance Taylor branded the process a “shambles”. This week Building reports the sad outcome - in terms of the legal papers filed in court.

As we said last month, the Cabinet Office should now be asking tough questions of the public sector-owned independent provider, UK SBS, that ran the procurement. Though we must not pre-judge the case, it is not good enough to simply say, as the Cabinet Office did this week, that it is not considering re-running the procurement.

But there is a wider issue here. Turner & Townsend’s challenge is not the only legal dispute over procurement Building has its eye on this week. US firm Energy Solutions has also filed papers challenging the Nuclear Decommissioning Authority over its awarding of a £7bn contract for decommissioning Magnox power stations to a rival.

Any moves which make more legalistic an already legalistic process will, in the end, prove a retrograde step

As we examine on pages 22-24, there seems to be a trend for construction firms to feel confident enough to challenge the government or other public bodies over their procurement decisions. With the government giving the industry up to 40% of its workload, challenging procurement exercises was traditionally a bit of a no-no on the basis that you don’t bite the hand that feeds you. But a combination of changing regulations and the separation of procurement functions from the actual end clients has seemingly conspired to alter this calculation.

Aside from the rights and wrongs of individual cases, in some senses it is good news the industry feels able to make its case when it has been ill-used, and isn’t allowing traditional commercial pressures to silence reasonable calls for redress.

But ultimately any moves which make more legalistic an already legalistic process will, in the end, prove a retrograde step. Former chief construction adviser Paul Morrell is right to say that in regards to procurement, the public sector is already held to a far higher standard than private clients.

On the one hand construction firms complain endlessly about EU rules which make bidding for public sector work a costly and time-consuming hassle, but then it is those same rules they utilise in order to challenge procurement processes they deem to be unfair.

There is unfortunately a potential downward spiral here: to some extent the “excessive” regulations around public procurement grew up in order to protect public bodies from legal threats - to give them a framework in which to safely operate.

The more procurement exercises are challenged, the more public procurement will become a simply procedural tick-box exercise, in which ultimately both public clients and construction firms will lose out.

None of which should be interpreted to mean that firms should not assert their rights strongly when they have genuinely been ill-treated. But the private sector should exercise caution in doing this, lest the ultimate outcome is public procurement that is even more governed by fear of legal challenge, rather than a genuine engagement over who would best build a given project.

Joey Gardiner, deputy editor