As part of the ongoing reform of Ireland’s capital management systems, the Office of Government Procurement is conducting a review of construction procurement and the Department of Public Expenditure and Reform is reviewing the Public Spending Code. The purpose of these reviews is to strengthen the existing guidance to better align with the realities of project delivery and with a particular focus on improved financial appraisal, cost estimation and management.
The following reforms will be considered and implemented as part of the Public Spending Code review:
- Strengthen and harmonise capital appraisal guidance;
- Greater clarity on governance and roles and responsibilities, particular in terms of who is the Sanctioning Authority and who is the Sponsoring Agency for major projects;
- Introduce new mechanisms to improve the accuracy of cost estimates;
- Improve project life cycle to better reflect the realities of project delivery; and
- Complement the Project Ireland 2040 Capital Tracker in monitoring projects and costs.
The revised central elements of the Public Spending Code relating to the appraisal and management of public capital projects will be published this summer. Further technical guidance building upon these central elements will follow in the second half of 2019 and in 2020.
Procurement legislation is established on an EU wide basis through the suite of procurement directives. The most recent directives were issued in 2014 and have all been transposed into Irish law by means of Statutory Instrument.
The Capital Works Management Framework ("CWMF") is the structure that has been developed to deliver the Government’s objectives in relation to public sector construction procurement reform. It consists of a suite of best practice guidance, standard contracts and generic template documents that must be used on all projects that are to be delivered under the Exchequer-funded element of the National Development Plan ("NDP"). It is managed by the Office of Government Procurement (OGP) in consultation with the Government Contracts Committee for Construction (GCCC).
The performance of a key component of the CWMF; the public works contract, was reviewed in 2014 and a series of recommendations that apply to the conditions of contract have been implemented since 2016.
That review prompted the OGP to undertake a broader review of the procurement of public works projects in order to develop the next generation of the CWMF.
A set of objectives have been developed to manage the review process which will permit a progressive refinement of the CWMF rather than awaiting the completion of the entire work programme prior to implementation. Enhanced risk management throughout a project’s life cycle and quality of information will inform all aspects of the work programme.
Consultation has already commenced with industry and the public bodies charged with the delivery of public works projects on a broad range of issues that are impacting on the successful and timely delivery of projects. These are wide ranging and warrant careful consideration and cover areas such as:
- price variation;
- risk management;
- creating a better quality : price balance in the award of contracts;
- adoption of BIM on public works projects;
- liability, indemnity and insurance requirements;
- performance evaluation;
- encouraging collaborative working.
It is proposed to publish a range of position papers throughout 2019 and 2020 on these and other issues and invite submissions from interested parties. Upon conclusion of the consultation process recommendations will be prepared by the GCCC on the measures necessary to address any shortcomings identified.
The programme commenced with a focus on the early stages of a project’s development with the publication of a position paper on the engagement of the consultant technical professionals upon which submissions have been received. The paper focusses on improving the manner in which consultants are engaged to provide expert advice to contracting authorities on matters such as design, cost estimating, project management, procurement and contract administration.