Last edited 21 Nov 2018

Framework contract

Contents

[edit] Introduction

Clients that are continuously commissioning construction work might want to reduce procurement timescales, learning curves and other risks by using framework agreements. This allows the client to invite tenders from suppliers of goods and services to be carried out over a period of time on a call-off basis as and when required.

The framework contract documents should define the scope and possible locations for the works or services likely to be required during the defined time period. They should describe the contract conditions that will be used for pre-construction services (such as design), and/or the contract conditions that will be used to execute the works.

Depending on the size and complexity of the anticipated projects, the supplier might provide a pricing mechanism or risk adjustment mechanism for different types of contract that might be used, for example a minor works contract, a cost reimbursable contract, a design and build contract, and so on. A suitable option would then be selected by the client depending on the nature of the projects that emerged.

[edit] Procedure

Framework tender documents are likely to include:

One or more suppliers are then selected and appointed. When specific projects arise the client is then able to simply select a suitable framework supplier and instruct them to start work.

Where there is more than one suitable supplier available, the client may introduce a secondary selection process to assess which supplier is likely to offer best value for a specific project. The advantage to the client of this process is that they are able instigate a selection procedure for individual projects without having to undertake a time-consuming pre-qualification process (which might be subject to OJEU procurement rules on public projects). This should also reduced tender costs.

The advantage to the supplier is that the likelihood of them being awarded a project when they are already on a framework contract should be higher than it would be under an open procurement process. Some suppliers however complain that having already been appointed on a framework agreement, they may then have to bid for individual projects anyway, and after a great deal of time and effort may not be awarded any projects.

[edit] Criticism

In November 2018, The Civil Engineering Contractors Association (CECA) published research suggesting that frameworks fail to deliver the work contractors expect and put them to unnecessary effort.

Its recommendations include:

CECA’s director of external affairs Marie-Claude Hemming said: “…while frameworks can be a useful tool to organise and deliver civil engineering projects, they do not always work effectively… We are therefore keen to start a discussion on how we can make frameworks work for everyone. Over the coming year we will be sharing this document with the wider infrastructure community and others, and we hope that our recommendations will become incorporated by our customers and wider government.”

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