The operations director of Scape has hit back at claims from construction companies its public sector procurement framework has a negative impact on regional businesses.
The North East’s three largest construction firms – Newcastle’s Surgo Construction, Gateshead’s Tolent and County Durham’s Esh Group – have been swiftly garnering high-profile support as they call for a rethink of a procurement strategy they say favours huge national companies over smaller but skilled regional ones.
Among criticisms raised in a letter they sent to northern MPs and ministers was that Scape, a local authority-controlled company that seeks to increase efficiency and cost-effectiveness in public sector construction work, requires contractors to have a turnover of more than ï¿½500m to be eligible even for small jobs, thus ruling out all but the national giants.
With only one Scape partner, Willmott Dixon, selected for major works in the north, the framework was also anti-competitive, being used through “laziness” rather than best value.
But Scape operations director Steve Elkin pointed out that, typically, construction projects were marred by uncertainty, with around 40% of projects costing more than expected and 60% finishing late.
“This is obviously where efforts have to be targeted as this is a genuine waste of public money and resources,” he said.
Over the last five years, the company and its partners had delivered 1174 construction projects, all of which have been delivered to budget and all but one on time.
Scape frameworks, Elkin added, were specifically designed to support local communities, with 50% of all of construction orders placed within 20 miles of the building site.
The company, which spends at least nine months on each framework procurement – as opposed to the six months a local authority would spend procuring the work itself – also sets targets for local employment and skills training.
“The industry has created layers and layers of process that cost the public sector money,” Elkin said.
“By streamlining these processes money is saved by allowing people to manage more projects than before – and to achieve best value as a result.”
Esh Group’s chief executive Brian Manning, however, remained unconvinced, saying that while it was clearly easier and quicker for public bodies to “latch on to” Scape, the framework did not provide best value for taxpayers in the North East as it was inaccessible to regional players.
The reason Scape could consistently deliver projects on time and to budget was that the single contractor selected had a “massive room for manoeuvre” compared to when traditional tendering was used.