Following the Comprehensive Spending Review Adrian Aston suggests that the level of spending cuts could be less if the government addressed some of the systems and procedures that waste money and create unnecessary overspend.
There is clearly a need for huge savings to be made but there are also many opportunities to save money that are being ignored in the rush to cancel and postpone major spending.
The procurement process for public sector projects Constructionline is one area in particular that is extremely wastefuland should be radically overhauled or scrapped.
The consultants and contractors that use Constructionline believe that the system is too complicated, too lengthy and could be wasting as much as £250 million each year.
There is merit in having a system that enables firms to tender for public projects in a uniformed manner but a working party that involves professionals from the industry should be tasked with developing a new system rather than the boffins from the Department of Business Innovation and Skills.
A similar situation exists with PFI projects. The cost involved in tendering for these projects is huge and the tendering process takes more than one company too far down the line before a final decision is made.
Framework agreements should also be overhauled. These enable the NHS and education sectors to keep a selected number of contractors and consultants on hand with the necessary experience and knowledge to carry out the work at competitive rates, but the system falls down when the framework agreement itself is too rigid.
The outlook for the construction industry is still very tough and addressing these areas of waste will allow everyone to operate more efficiently and profitably in the future.
Let’s hope that the government realizes the need to view a strategic long term alongside the short term need to reduce the deficit in order to ensure that there is enough capital investment in the areas needed to stimulate the recovery.
0 comments:
Post a Comment