
THE PARLIAMENTARY REVIEW
Highlighting best practice
THE PARLIAMENTARY REVIEW
Highlighting best practice
28 | SUM
Expertise in the education
sector
Recent years have proven lucrative. Last
year, we worked on projects totalling
£250 million and have hit record
turnover figures for the last three
years. This is largely down to success in
both dispute resolution and education,
with both areas delivering double-digit
growth over the past sixyears.
Moving on considerably from our
early days working for developers on
residential projects, we now enjoy a
reputation as experts in the education
sector, supporting the construction
of university buildings and schools.
Our expertise is being made real
around many campuses in the north
of England in the form of impressive,
high-tech, high-value build projects.
Most recently, we have been working
with Leeds Beckett University on their
new £90 million Creative Arts Building,
which will be home to their School of
Film, Music and Performing Arts, and
their £45 million Carnegie Teaching
and Research Building, the home for
the Carnegie School of Sport. We
have held framework agreements with
Leeds Beckett University for several
years, partnering on 65 successful
projects to date.
We are also working with the
University of Leeds after securing a
place on their professional services
framework, delivering quantity
surveying services on projects until
2020. The scope for this work is
considerable, with the university
committing more than half a billion
pounds towards their current capital
development programme. Completing
our hat trick of university clients is
the University of Hull, who we are
working with on a new engineering
faculty building and a further project
of national importance.
The public tendering
challenges that face SMEs
While we have been fortunate in
securing work in the education
sector and local government,
significant barriers to entry exist for
SMEs in terms of winning work for
government departments. The work
is often awarded to the big national
or international players, which
ironically often subcontract elements
to smaller firms with more detailed
localknowledge.
From our perspective, choosing firms
local to the project can have important
benefits and reduce cost and risk.
Smaller firms like ours tend to have
owners with a vested interest in their
projects and will go above and beyond
to ensure client satisfaction. In terms
of risk, the demise of large providers
like Carillion proves that size is no
guarantee of stability. In our view,
companies’ balance sheets should
become increasingly important in
procurement. This may benefit smaller
companies like ours, who must keep
a tight rein on finances, maintain
decent cash reserves and have no
debt. Conversely, some of the largest,
best-known companies have significant
levels of debt on their balance sheets,
which may work against them in the
tender process, particularly if interest
rates rise in the future.
Work underway at Leeds
Beckett University’s new
£90 million Creative Arts
Building
Our expertise in
steelwork was
employed on this City
of London landmark
The
introduction
of graduate
apprenticeships
is proving
beneficial for
candidates and
employers
“
“
29SUM |
CONSTRUCTION & ENGINEERING
Another challenge is the lack of
investment in technology. While
building information modelling should
improve operational and estate
efficiencies, IT in construction lags
behind that in other sectors. There is
scope for considerable industry-wide
improvement and disruption through
the use of better tech.
A significant percentage of our annual
revenues comes from university
capital investment programmes,
so news that international student
numbers and potential fee incomes
could be declining due to perceptions
around Brexit is concerning. More
positively, the introduction of graduate
apprenticeships in quantity surveying is
proving beneficial for candidates and
employers. Our industry continues to
struggle with recruitment and skills
shortages, so this initiative has been
well received.
The impact of retentions
One area where we would welcome
change is retentions. Retentions are
the percentage of the total payment
due to a contractor that is retained
by the client to ensure that work is
properly completed. Retentions are
often imposed on subcontractors
throughout the supply chain too. This
can cause cashflow issues, particularly
for SMEs, who can have payments
withheld due to issues caused by other
suppliers over which they have no
control. TheConstruction (Retention
Deposit Schemes) Bill 2017-19, a
private member’s bill introduced in
January 2018, is to be commended
for raising awareness of the issue, but
we would like to go further and see
retentions abolished altogether.
We would also like to see the
adoption and promotion of project
bank accounts to ensure the smooth,
timely movement of funds throughout
the supply chain during what can be
extremely lengthy projects. Otherwise,
large contractors can effectively use
SMEs as a free credit supply.
Finally, the process of adjudication is
an excellent way to resolve disputes
in construction projects quickly and
easily. It has also created a revenue
stream for us, being formally qualified
to represent clients in adjudication.
However, the restrictions around
which sectors can use adjudication
could be relaxed. For example, a
dispute around the building work
for a power station is exempt from
adjudication and must go through
lengthy legal proceedings, even
though the dispute could be a
straightforward construction issue.
The close of this decade looks set
to be an exciting period for us, with
plans well underway to open an office
in Manchester to target civic projects
and universities in the North West.
Our aim is to become a truly national
player and expand our work both
geographically and across sectors
while maintaining our foothold in
the areas in which we are now well
known and respected.
Smaller firms
like ours tend to
have owners
with a vested
interest in their
projects and will
go above and
beyond to
ensure client
satisfaction
“
“
Artist’s impression
of Leeds Beckett
University’s £45 million
Carnegie Teaching and
Research Building