微密圈

David Mosey must rank among the most infectiously positive people in the construction industry. Even on an icy, grey day in January, the King鈥檚 College London professor of law beams with optimism.

Part of this might be because he is about to jet off to Oman, where bleak midwinter temperatures are currently hitting around 25掳C. Mosey has been going to the country for more than 30 years, having once headed up a regional office there for law firm Trowers & Hamlins. It has not always been without incident: 鈥淲henever I went to the Middle East, a war started,鈥� he says. Thankfully, at the time of writing, the ceasefire in Gaza is just about holding.

But it would be fair to say that the most likely source of Mosey鈥檚 positivity is the recent success of his initiative to reform how public sector bodies procure construction work. 微密圈 last spoke to Mosey in early 2022, a month after the publication of his landmark report, Constructing the Gold Standard. It has since become something of a core text in the procurement world, helping to sweep away wasteful practices by making public sector frameworks more efficient, reducing costs for both clients and providers. 

Enthusiastically adopted by the then Conservative government, it has been bolstered by a verification scheme for framework providers, launched in late 2023 and designed by industry best practice group Constructing Excellence. So far, five organisations have been rated 鈥淕old Standard鈥� 鈥� the Crown Commercial Service, Scape, Place for People, Communities and Housing Investment Consortium (CHIC) and LHC.

More are set to follow this year, including the Ministry of Justice, which has been a leader in the field of progressive procurement with its alliancing contracts for its 拢1bn prisons programme. 

This is important progress, and it is just the beginning, although Mosey admits to being impatient to see more major providers added to the list. 鈥淧rogress will never go quickly enough for David,鈥� says head of Constructing Excellence Alison Nicholl, who has played a leading role in the creation of the verification scheme.

To explain what all of this means, it is worth taking a step back to Mosey鈥檚 original report and what it set out to do. Published in December 2021, it was part of a phase of government-backed research into addressing systemic issues in the built environment which included the Construction Playbook, a set of best-practice guidance for making construction firms more efficient.

The 24 recommendations in Constructing the Gold Standard sought to implement the Construction Playbook, addressing an array of shortcomings in how public sector frameworks in the UK are used, from misleading speculative values to a lack of collaboration and unrealistic expectations of supplier capacity.

For too long, Mosey says, the industry has 鈥渉ated frameworks because they felt they invested a fortune in bidding them and weren鈥檛 getting the progress, the workflow, the opportunities to participate that they expected鈥�. Average bid costs for contractors have been around 拢247,000 per framework, and around 拢130,000 for consultants.

Yet the pipeline of work estimated by framework providers would often not materialise, and suppliers were stuck with competing for lowest cost purchasing approaches from clients for a lower than expected number of jobs. 

Were framework providers really just plucking figures out of the air when estimating their lifetime spend? 鈥淵ou really get the impression they were,鈥� admits Mosey.

The roughly 2,000 active public sector frameworks had a combined value far larger than the entire public sector construction throughput of this country. 鈥淪o someone was exaggerating,鈥� he adds.

Part of the problem has been the prevalence of public sector frameworks  managed by private sector firms. This has been a key point of contention in what Nicholls describes as 鈥渞obust鈥� discussions between government officials and industry representatives during the creation of the verification scheme. Suppliers have long felt a degree of 鈥渉ostility鈥� towards private sector framework managers, Mosey says, while clients have felt anxious over the quality of service for which they were paying.

The problem? The private firms running the framework charge a fee, while the service they provided, ostensibly for the public sector, was too often seen as wasteful, exploitative and often misleading. 鈥淭here is a lot of criticism because there鈥檚 a sense that people were profiting from something that should be run by the public sector,鈥� Mosey says.

鈥淗ow can I put it? They were the sort of people who administer, not the sort of people who could lead.鈥� It may not be entirely unintentional that he refers to them in the past tense.

>> See also: Constructing the Gold Standard for public sector frameworks 鈥� has anything changed?

While Mosey is clear that he does not want private sector firms barred from managing public sector frameworks, he does want their role to be better defined. Under the Gold Standard system, where a public sector framework provider is supported by a private sector manager, it must be the public sector authority which is sending out invitations to bid.

And the conclusion on which Mosey has landed after 鈥渃onsiderable debate鈥� with government officials and industry representatives is that it must be the public sector provider which applies for Gold Standard verification, not the manager.

Mosey also believes that private sector expertise still has a valuable role to play in public sector procurement, and stresses the need for a responsible framework manager that can update clients and suppliers on a credible pipeline of work. The five verified framework providers have all demonstrated they can do this, so that 鈥減eople know what鈥檚 coming around the corner and know that they can have a chance of getting that,鈥� Mosey says.

鈥淏ut that is a management process that doesn鈥檛 happen on its own. So an active framework manager is essential.鈥�

But, while a key aim of the verification process is to ensure more responsible forecasts of lifetime framework values, it does not insist on complete accuracy. 鈥淎s soon as you insist on accuracy, everybody runs away,鈥� Mosey has found.

Instead, the gold standard wants an 鈥渋ntelligent assessment of likely spend and a transparent picture of that鈥�, even if this is subject to an annual funding round or planning issues subject to variation. 鈥淲e want transparency and credibility.鈥�

The existence of a verification scheme to back up the original recommendations in the Gold Standard report is itself unusual, given the number of reports on industry best practice which do not have this benefit. It was also not what Constructing Excellence originally set out to do when it formed a task group in order to look at how the report could be implemented.

Nicholl says the team had sought to find a way to ensure that framework providers understood the report and were putting the right practices in place, but decided that a verification process was the best way to do this.

It works with teams of independent auditors who look at how providers operate their framework, including through interviews with management staff. The verifiers鈥� role is to find areas where improvement is needed and report back with confidence that those improvements are being put in place.

Any verification is also subject to review, with providers required to prove that they have implemented Gold Standard-level practices and are keeping them in place. 

Nicholl says that every provider which has gone through the process so far has said how useful it has been, partly as it has galvanised senior staff to question their own practices, which they had assumed were robust. 鈥淎ctually having a verifier come in and say, 鈥榯his needs a little bit more focus鈥�, has given them that sort of ability to drive this best practice through the organisation and get that buy in,鈥� she says.

鈥淓very organisation dreads getting audited鈥� but it will flag up areas for improvement, and it gives a reason to do that improvement.鈥�

Mosey lists four areas of improvement for which verifiers are looking. The first is allowing clients to team up on frameworks as opposed to calling off work by themselves, which Mosey calls 鈥渢he old school approach鈥�.

This aggregation of procurement allows cash-strapped local authorities to pool their work and their expertise to create shared intellectual property and innovation, helping to end what the original 2021 report had described as the 鈥済roundhog day鈥� of endless lost learning, as the same types of jobs start from scratch each time they are called off. 

The second is what Mosey says is the biggest opportunity for change, sharing tier two supply chain members. This was used by the Ministry of Justice in its prisons programme, but is 鈥渟till not being fully exploited鈥�.

The Gold Standard has early supply chain involvement on a 鈥渟trategic level鈥�, including a range of methods for accessing local and regional tier twos. Verified providers are given an action plan for their first year that requires them to implement these changes.

>> See also: DfE to bring forward new 鈥榓lliancing鈥� framework for contractors

The third is the old issue of prompt payment down the supply chain, which framework providers should try and monitor on individual projects. Lastly is minimising the impact of supplier insolvency, which has been most dramatically demonstrated on the prisons programme with the collapse of ISG. The stricken contractor was working on the project to build four largely identical adult male prisons on an alliance contract with Kier, Wates and Laing O鈥橰ourke when it went into administration in September last year. 

Under the contract, the work of one supplier would be transferred to another in the event of an insolvency. And, because the four firms shared a common supply chain and the same rules of engagement, the impact of ISG鈥檚 demise was lessened.

鈥淭hey鈥檙e not coming in thinking, 鈥榳ho the hell am I dealing with?鈥� They鈥檙e coming in saying, 鈥榬ight, I鈥檒l take over from those parties,鈥� 鈥� Mosey says.

All five verified providers can now say they are industry leaders in pushing these principles forward. One major provider has failed the verification process, although only 鈥渟o far鈥�. 

鈥淭hey have been pushed back pending further actions,鈥� says Mosey. 鈥淎nd they have said they want to take those further actions, so I think it鈥檚 important that this is not an open door for everybody to walk through, that this is a robust process and that our independent verifiers have the confidence to tell people if they don鈥檛 comply, but the ball is still in play.鈥� 

The failed provider has not been named, and verifiers all sign NDAs when starting the verification process. Nicholl is keen not to deter providers from going through the process, which she says is 鈥渘ot there to catch people out. We want people to improve.鈥�

This emphasis on positive change could partly explain why the Gold Standard initiative has survived intact through a period of prolonged political uncertainty. Four prime ministers have passed through No10 since Mosey鈥檚 original report was published. But, unlike so many other aspects of government policy on construction, including HS2 and the New Hospital Programme, the Gold Standard initiative has had consistent backing from ministers. 

Has progress been slowed down by all the disruption of the past few years? 鈥淚 think it鈥檚 the opposite,鈥� says Mosey. 鈥淚 think people are so pleased to be participating in something that is non-political and is logical and is progressive.鈥�

It has also benefited from its essentially non-political aims of getting more value out of taxpayers鈥� money. 鈥淚t鈥檚 hard to argue with, isn鈥檛 it?鈥� says Nicholl.

鈥淚t鈥檚 not like we鈥檙e trying to influence a particular technology or anything like that. It鈥檚 literally making sure that those sort of mechanisms are in place to deliver the right outcomes.鈥�

The reforms are seen as a way to achieve government targets faster, whether it be on net zero, building safety or infrastructure. They also have industry backing through Constructing Excellence, which counts some of the sector鈥檚 biggest names as members including Kier, AtkinsRealis, McLaren, Mott MacDonald and RLB.

With so much goodwill, Mosey says working on the Gold Standard feels like 鈥減ushing at an open door鈥�. Now, it is a 鈥渕atter of the government having the confidence to give it a big push鈥�.