Latest Public Sector News

03.07.13

£447m savings in construction costs

The construction sector has generated £447m savings in the last year, cabinet office minister Chloe Smith has stated.

The annual Government Construction Summit heard that making links across government provides clear benchmarks to cut costs and encourage more innovative and competitive solutions.

The sector must deliver up to 20% savings in project costs by 2015.

Speaking at the summit, Chloe Smith said: “Government is a good client who pays on time and invests in projects that make an important economic impact to help the UK compete in the global race. We’ve always been ambitious in our plans to reform public sector construction, and the £447 million in savings generated by acting as a single customer shows just how we are spending public money more intelligently.

“Working more collaboratively has identified where we can strip out unnecessary waste in construction projects and test out innovative models to help businesses of all sizes win Government contracts. Our reforms aim to deliver projects up to 20% cheaper by 2015 – making at least £1.2bn available to reinvest. That means 60 new secondary schools, or 60 new community hospitals.”

Civil Engineering Contactors Association (CECA) director of external affairs Alasdair Reisner said: “Two years ago industry and Government agreed to work together to drive the cost of construction down by 20%. We have welcomed the chance to be involved with this work, and are pleased to see that the results are starting to emerge, producing sustainable savings that reduce the cost of construction for the taxpayer. We hope that the new approaches will be adopted widely, creating a leaner and more competitive industry that delivers exemplary results for its customers.”

CEO of Constructing Excellence Don Ward said: “The early findings of the trial projects monitored by Constructing Excellence already point to smarter procurement delivering significant improvements in value for money for the public purse. Of course it is key to ensure savings do not impact on safety, quality or whole life performance, and our monitoring will focus on this as well as capital cost savings.”

Tell us what you think – have your say below, or email us directly at opinion@publicsectorexecutive.com

Image c. Rubber Dragon

Comments

William   09/07/2013 at 14:12

What nonesense!! Where exactly and how was this £447m 'saved? Contractors' profit margins are a few percent so how are 20% savings going to be achieved.

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