The Construction Playbook – Standardising contracts
A central policy of the Government's Construction Playbook is the use of standardised contracts across the public sector.
Specifically the starting point that contracts should be selected from one of the following suites:
- JCT 2016, as published by the Joint Contracts Tribunal
- NEC 3 or NEC 4, as published by the Institution of Civil Engineers
- PPC2000/TAC-1 and FAC-1 as published by the Association of Consultant Architects
However, in an industry where no two projects, or two clients, are the same care must be taken to ensure the form of contract is appropriate. Additionally, bespoke drafting will often be needed to meet the Playbook's other aims.
The Playbook makes clear that the form of contract should be considered and selected early in the procurement process as the impact of this will flow down the supply chain, notably by ensuring contract terms are not unintentionally stifling innovation, sustainability or investment in modern methods of construction.
Therefore public sector clients will need to turn their attention to, and involve their external advisers in, selection of the form of contract at the outset of a project. That may require some change of approach to move this issue further up a client's priority list. Trowers has been running a programme of thought leadership and seminars/webinars around these topics to assess the market's approach to, and offer advice on, the wider commercial discussions on contract selection. This is something that needs careful thought at the outset of a project because to set off on the wrong path at contract selection stage can have detrimental effects later in the project. We have seen projects succeed or fail as a result, so it is important to seek the right advice early.
The Playbook does not prohibit the use of different forms of contract. And again, other forms of contract are themselves likely to require amending to ensure compliance with the Playbook in other respects. Nor does the Playbook argue against amending standard form contracts, making clear that client specific requirements and risks that are not covered by the standard contract terms should be dealt with via a schedule of amendments in the usual way.
Nevertheless it stresses that compliance with the Playbook will need to be addressed in relevant governance and approval processes, and that bespoke clauses that do not apply to a specific project should not be incorporated.
This all underscores that a "one size fits all" is not appropriate for construction projects and is not the Playbook's intention, despite the focus on standardised construction contracts.