Is partnership working over?

PFI & Subcontractors

October 21st, 2023
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So how good are your subbies? How well do they know your contract, and do they understand your deliverables?

Chances are your project is just another contract to them. It doesn’t mean that you’re not important to them nor that they don’t work hard for your project but how can they have your back when they don’t understand the contract deliverables that you abide by?

I am seeing more and more penalties and issues surrounding subcontractors than ever. Here are some of the areas of concern:
- Subcontractor delays in attendance for final fixes causing penalty points or unavailability events.
- Delays in getting parts causing penalty points or unavailability events.
- Extension of Time requests being denied due to long lead times for works or materials.
- Insufficient details in scopes and quotes causing delays in processing Variation and Lifecycle works. This also leads to the inability to demonstrate value for money to other stakeholders.
- Delays in processing invoices for payment because of missing information. Late payments often end in non attendance and PPM’s being missed whilst disputes are being resolved.
- Insufficient information given in reports and attendance sheets to clearly highlight remedial works leading to delays in following up and processing. This can cause major compliance issues.
These challenges can have a significant impact on a PFI/PPP contract. With the increased scrutiny through audits and performance evaluations, it is now more crucial than ever for contract stakeholders to engage proactively with their supply chain partners.

How many of your contractors truly grasp the distinctions between a PFI contract and a standard maintenance contract? When configuring the contract packages, how much emphasis was placed on Service Level Agreements (SLAs), reporting requirements, quoting procedures and updating planned preventative maintenance (PPM) dockets? Have you considered requesting contractors to document damage with photographic evidence?

Over the last few months I’ve spoken to a number of contractors who carry out a lot of their works on PFI/PPP contracts. All are eager to help and would welcome the chance to better understand PFI requirements so that they could become a more reliable and useful partner.

At Nine Acres, we are in the final stages of developing a tailored training program designed for subcontractors seeking to better support PFI/PPP projects. Key topics covered in this training include:
- Effective scoping and quoting for projects: An emphasis on the importance of breaking down labour, materials and markup to expedite approval and processing.
- SLAs, Penalties and Unavailability: Understanding how delays can impact a contract both financially and reputationally and identifying strategies for risk mitigation.
- The critical role of Remedials: Emphasising timely identification and quoting, as well as the essential details necessary to distinguish between requirements and recommendations.
- The importance of Audit Trails: With an emphasis on recording actions, competencies, locations, cause and effect, isolation, final fixes, and future return plans.
- Considerations related to the lifecycle replacement of assets on PFI contracts: Including comparisons between like-for-like quotes and alternatives that offer energy efficiency, ease of maintenance and improved availability of parts.
- CDM (Construction Design and Management), HTMs (Health Technical Memorandums) and other contractual obligations: Summarising potential nuances and standards that may arise in PFI/PPP contracts.
- Guidance on invoice submission: Highlighting the specific information required to expedite payment processing. Most PFI/PPP contracts require a purchase order reference, proof of attendance, correct project/contract references and the receipt of the required reports.
A project is only as good as its weakest link. There is no reason for that weakest link to be your supply chain.

If you think your supply chain could benefit from some PFI training, or if you are a contractor that wants to better understand how you can support and maximise performance for your clients on PFI/PPP projects, then get in contact with Nine Acres. Nine Acres will be tracking all contractors that complete the training which can be shared across the PFI/PPP community.

Drop me a message here, LinkedIn or email me at tgreen@nineacres-amc.com.
Has partnership working gone forever?

September 30th, 2023
In PFI and PPP, most contracts have been written to suit partnership working, but what happens when the partnership element is no longer there?

It appears that the toll of poor performance audits, staff changes and tighter budgets has put an all time strain on partnership working. Should we just accept that this is the way it is now? Adversarial meetings, slow progress on projects, the scrutinisation of every ounce of data and high staff turnover due to toxic working environments?

In a situation where there is more than one stakeholder at play it is always easier to focus on the failures of others and pass on all the blame to them. IN doing so though are you confident that your party is completely free of blame at the same time?

Project Co/SPV….you can’t be to blame can you? You just have poorly performing FMCo’s and troublesome tenants. You pass ALL your obligations down to contractors so what could you do wrong? Surely you are just caught in the middle? I mean, you have been conducting thorough monitoring of FMCo’s since project start eh? You always make quick and fair decisions based on the contract to avoid unnecessary conflict? And, you have always had a balanced team of both commercial and technical/operational competencies well versed in all the contractual obligations? You would never act as a middle man or postbox and just pass correspondence from one party to another, you always review it thoroughly and only send on when you feel it satisfactory meets it’s requirements to avoid frustrations from other stakeholders?

FMCo’s (Soft and Hard) Well it can’t be you to blame. You guys and girls have not changed how you’ve operated since the start. It’s everyone else that’s changing the rules. No one ever wanted to get contractual before so why are they doing it now? There’s a load more rules and not enough time in the day to deliver everything. I mean these new rules can’t just be obligations that you should have been delivering on since the start can they? Recent audits can’t be finding significant failures in compliance and obligation delivery?…..and why are they even necessary?….you produce a monthly report which clearly highlights any failures or risks! You were reporting on these failures long before the auditors came in right? Why does no one trust you now?

And local authorities/public sector entities it definitely can’t be you? You have had to go over and above to identify poor performance and highlight issues. Everyone else has let you down but you are not letting that cloud your judgment on how you deal with things going forward. You’re now scrutinising everything (as you rightly should after poor audit scores) but in doing so you are understanding of the additional strain that puts on SPV’s and FMCo’s? You are open to improvement plans to drive forward performance even if the last two plans have failed. You actively manage the building users and provide training and updates to ensure damage and misuse is at a complete minimum as to not lead to additional reactive works for FMCo’s and mitigation for SPV’s?

With so much blame and not enough reflection it’s hard to see how we can get partnership working back? I’m going to put it out there that perhaps all stakeholders are a little bit to blame. Some more than others I would like to say and I appreciate the frustrations, BUT, if we all look to how we as a stakeholder are performing and reacting we might stand a chance.
- SPV’s it’s time to get hands on. Scrutinise FMCo’s regularly but establish set times and manage expectations. Don’t save everything up for once a year! FMCo’s only perform as bad as you allow them to.
- FMCo’s review what and how you deliver. Use your data better to be proactive rather than reactive. Use the data to actively manage and communicate to other stakeholders. TRANSPARENCY leads to TRUST. And for the love of god please tighten up your audit trails!!!!!
- Local Authorities/Public Sector Entities I know you are frustrated and feel let down but there is still quite a lengthy concession to go on some of these projects. Partnership won’t be possible without you! Be open to improvements. Feedback is key, communicate what you need to see for stakeholders to earn back your trust. Don’t just communicate the failures, communicate the positives too.
I’m refusing to believe that partnership working can’t make a comeback. Without collaboration and open dialogue among all stakeholders we can’t rebuild trust and achieve positive outcomes! Naive as it may sound, in the current climate I think that if everyone puts as much effort in to making changes for improvements as they do in trying to apportion blame, then we are on to a winner!

PFI & Subcontractors

Has partnership working gone forever?