(See also News and Users)
Francis Ho, Head of Construction at Olswang, “A Frame of Mind” on FAC-1 in Building magazine 18.03.16 : “It will take an effort to shift developers off their beloved custom frameworks but at least there’s now a convincing alternative for those with the desire to explore more meaningful collaborations”.
Christopher Pedder, Partner, Trowers & Hamlins “Alliancing revolution: New contract targets better relationships” in Construction News 11.07.16 “FAC-1 can also be used for ‘additional clients’. This is a significant benefit for the public sector, where lead authorities seek to act as central purchasing bodies for other public sector authorities”.
David Mosey “A First for Frameworks” on FAC-1 in Construction Law Aug/Sept 2016 “Bid costs have been reduced significantly using a pilot version of the new contract”.
David Mosey interviewed by RTE Radio, Ireland
RADAR Roundtable – Building Collaboration within Frameworks with David Mosey
“An engaging presentation on FAC-1 as the workflow of a framework with the benefits of an alliance highlighted the fundamental question of “Why if you want collaboration would you use an adversarial contract?”. From this examples abounded of where frameworks go wrong culminating in the hypothesis of “Can alliancing rely on good faith?”
In answer to the questions of “Why do we need a framework alliance contract?” And “Why is FAC-1 significant?” it emerged that good frameworks and good alliances leave a gap in the market for a new standard form of multiparty contract linking stakeholders and supply chain to the client as alliance members managed by an alliance manager. An essential of a framework alliance is that of making the parts into a greater whole so that what you do together improves the value. A major component is new ways of engaging the supply chain.The exemplar Surrey County Council Project Horizon was quoted as a pilot for testing much of the thinking behind the contract.
Key factors are the addressing of sustainability, governance, early warning and alternative dispute resolution options.
The philosophy behind the new contract is given in the RADAR Talk https://youtu.be/9qgZIwqF9bI
FAC-1 is not a project contract and is the result of collective endeavour. It works across cultures on the basis that empowering away from client and project manager to a group increases collaboration and increases motivation.
Can collaborative working be defined? Is it a set of values? Is the measure of collaboration in the machinery of good faith? Can good faith be evidenced?
A good early warning system is essential. There can be an undermining of contracts and workshops if contracts encourage silos.”
Futures Housing: CIPS
“Framework forces competitor collaboration” posted by Andrew Allen 10 August 2016
Back left to right: John Thornhill, John Forde (senior associate, Trowers and Hamlins), Ian Skipp (group finance director, Futures) and Martin Sherman (executive director of finance, Futures). Front: Professor David Mosey
A housing association in the East Midlands is the first to use a new framework contract that connects competitors and encourages them to work together. Futures Housing Group has adopted the Framework Contract Alliance (FAC-1), which not only makes it easier for small businesses to bid for deals, it sets shared objectives for those on the framework.
Professor David Mosey of King’s College London was commissioned in 2015 by the Association of Consultant Architects to create new forms of framework alliance.
He said of FAC-1: “The benefits are that you combine the pipeline of work under a framework using the shared objectives of an alliance.
“In other words, you’re connecting people who think they are competitors and saying ‘there’s a pipeline of work from us and there are ways of working together for your benefit and ours’. It uses the throughput of work to make people more innovative and collaborative.”
Alliance members are expected to work together to improve value, share information on suppliers, review and compare prices and tender or renegotiate subcontracts. Mosey originally drafted PPC2000 and has since worked closely with the UK government on trial projects to analyse the savings and other benefits of the ‘two stage open book’ procurement and delivery process. The results of these trials were included in guidance launched by Sir Vince Cable in July 2014.
Futures Housing Group, which manages more than 9,000 homes, said the impact of the framework alliance could be clearly seen in its latest process. Head of procurement John Thornhill, said: “The first contract we’ve put out under these new rules, for planned maintenance works, has seen around 90 businesses bid – which is unprecedented. The changes to the law have put us in touch with smaller businesses that previously weren’t able to afford to work with us, for example due to cash flow constraints if they took up a works programme.”
The new contract, which was launched on 2 June, combined with the latest procurement rules has enabled SMEs to tender for parts of bigger overall frameworks with Futures, creating healthier competition in the market and giving the organisation more resources to draw on. The approach is designed to be easy to understand and to help improve legal compliance as well as better value for money.
Mosey said of Futures: “This is the first not only for the housing sector, but in any sector in terms of the use of the contract – there’ll be a lot of people coming behind.”
The guidance says it fills a major gap in the market and can also be used with JCT, NEC, FIDIC and any other standard form construction contract.