Public and private sector organisations alike are turning to frameworks to procure planned maintenance services. Richard Sutton, General Manager of Horbury Property Services, explains why
Procurement can be an expensive process, especially in the world of planned maintenance. Public sector organisations spend an estimated £200 billion on procurement every year, a colossal amount, but it is a legal requirement that they follow EU tendering rules.
Good procurement of planned preventative maintenance, whether public or private sector, is based on achieving best value for money for the organisation and stakeholders. In public procurement, this is defined as ‘the best mix of quality and effectiveness for the least outlay over the period of use of the goods or services bought’. The idea is that this should be achieved through healthy competition.
Public sector procurement is highly rigorous as it is subject to a legal framework that encourages free and open competition and value for money, in line with internationally and nationally agreed obligations and regulations. As a result, procurement can be expensive, and having to comply with OJEU rules and regulations often means employment of a project manager to oversee the process – not to mention the hidden cost of staff having to organise and score the tender documents and shortlist suppliers.
What public sector tenders do well is analyse the financial risk of contracting with an organisation. And anyone contracting with a recently approved framework contractor has the assurance that due diligence will have been carried out on their financial stability.
There are many reasons why organisations may choose to use approved framework services for planned maintenance services. One of the main benefits is that it gives assurance that the suppliers have had their technical ability assessed, that they meet quality criteria and have appropriate accreditations. This gives greater peace of mind that they will deliver the outcomes of the project to a high standard, and their service will meet requirements.
In short, the main reason that private companies are using publicly available framework agreements is that they recognise the bulk of the work in appointing a supplier has been done for them.
FAST AND EFFICIENT
Finding a suitable framework agreement is not difficult for planned maintenance as frameworks are often free to access, and services can be procured quickly and efficiently, saving external organisations thousands of pounds. All public organisations, whether it be local authorities, universities or the NHS, have approved framework contractors for a wide range of services, such as flooring refurbishment, fire door inspection, fire stopping, ceilings and partitions, or joinery and fabric maintenance. An organisation will often tailor a framework agreement to suit its own requirements, selecting the top two or three contractors and asking them to quote for individual or long-term projects.
There has been a great deal of discussion about whether private or public sector procurement is most effective, and, indeed, whether the private sector needs to carry out such rigorous processes when this is already done by the public sector. Some argue that there is a vast difference in meeting the needs of a private sector over a public sector organisation. However, the principles are the same. In simple terms, both are looking for good value for money from a contractor that is financially stable and can deliver the services at a certain quality for the length of the contract.
There are many well-documented arguments for and against public and private sector procurement. Some have said that the public sector views procurement as a means to place orders and have goods delivered, but do not understand the potential value that can be added, simply seeing it as a way to make savings.
One of the downsides of public sector procurement for planned maintenance or other services is that it must be for a fixed period, and the organisation must go back to the competitive market after a few years. When frameworks are adopted by private providers there are no such restrictions, and the chances are that they may be extended for longer periods if the organisation is satisfied with the work and value being provided.
Many private sector organisations, whether landlords, developers or property management companies, don’t have the resources to manage a national or international procurement process. The next best thing is to source a planned maintenance provider via approved framework agreements.