It’s not lost on me that we have been here before. There is a feeling of groundhog day to our call for reform of Public Works Contracts. Since its inception in 2007 we have been making that call.
Over the last decade we have produced policy documents, hosted international conferences, a colloquium in 2017, and last year’s Idiro Analytics report into Public Procurement Practices from CECA.
The difference now is that we operate in a competitive international market. Clients, including Irish public clients, are finding it harder to compete for construction contractors to carry out their work. Who could be surprised?
Many Irish contractors are finding better commercial opportunity in the domestic private market or by exporting services abroad. Put simply, there are better commercial opportunities and more collaborative clients out there for constructors.
A healthy vibrant construction industry must be built on contractors who can make sustainable profit margins similar to other industries. Fundamentally, there is a need to rethink the attitude to the sector and treat it more like the business industry that it is.
Construction contractors are a critical engine of Ireland’s economic growth equalling six per cent of GDP. The sector underpins the growth found in all other sectors by delivering the infrastructure required for growth.
We quite literally build the fabric of our society.
A shovel ready solution
The construction contracting Industry is an essential business sector. One that is highly complex, delivering advanced solutions for Ireland’s economic, social, and environmental problems.
Similar to other industries, the CIF’s construction contractors also want to work in partnership with the Government, dealing with each other on fair terms, reducing uncertainty and managing risk fairly.
For that to be possible we need to see reform of the Public Procurement Process and Contracts. The truth is, we know there is a ‘shovel ready’ solution already there, in the form of the New Engineering Contract (NEC).
The NEC is used in the UK, EU and more. Many of our members are already using it in these markets. The NEC is designed to drive collaboration, focus on problem solving, incentivise performance and manage risk more effectively. It’s focused on delivering assets rather than disputes.
Reform needs both the political will and the continued and sustained backing of senior civil servants, or we will see more and more construction contractors choosing to work elsewhere with clients who wish to work in partnership, rather than on a transactional approach.
We know that a healthy and sustainable industry will be critical to the delivery of the Government’s National Development Plan. Bringing the Public Procurement Process and Contract in line with international norms like the NEC will be critical to achieving this.