How NEC has helped to transform construction procurement and delivery

David Hancock, NEC Users' Group Chair

After three years in the chair for the NEC Users’ Group this will be my last editorial in the role. I stood down at the annual conference last month and leave you in the first-class company of my friend and colleague from the UK government’s Crown Commercial Services, John Welch.

In that time there have been some significant changes in construction and the way we procure and deliver our projects, and some interesting changes to our industry.

NEC4 was launched in June 2017, not long after I became chair. It introduced two new contracts: the NEC4 Design Build and Operate Contract (DBO) and the NEC4 Alliance Contract (ALC).

NEC contracts and in particular NEC4 are recommended by the government’s Construction Board for use by public sector bodies where appropriate. Standardising use of these comprehensive suites of contracts can help to promote behaviours in line with the Transforming Infrastructure Performance (HM Government, 2017) and the Construction Playbook (HM Government, 2020).

The government’s Infrastructure and Projects Authority is now working on Transforming Infrastructure Performance – Roadmap to 2030, which will take forward ministers’ ambitions to build back better, greener and faster from the Covid-19 pandemic. Please look out for this flagship publication which is due to be published later this year.

Transforming Infrastructure Performance was also where the government set out its intention to accelerate the use of modern methods of construction (MMC), including offsite manufacturing. Five central government departments (transport, health, education, justice and defence) committed to, ‘a presumption in favour of offsite construction,’ by 2019 where suitable and it represents best value for money.

Increasingly NEC users are seeing the benefits of MMC, for example in UK school and prison building programmes, and its use continues to be extended worldwide. But MMC offers wider benefits than just improving the way we deliver our infrastructure and construction projects. Importantly it opens the construction sector up to a more diverse workforce.

It provides a better quality and safer working environment – particularly for those with disabilities and also for those with child-caring responsibilities. Construction sites can be unfriendly places and the new innovations are making the industry a more attractive career, especially for young people and those who had not previously thought of it.

I must also pause to reflect on three events that impacted the sector over the past three years: the Grenfell Tower fire in 2017, the collapse of Carillion in 2018 and, since 2020, the ongoing pandemic.

Each has made a significant impact on the industry and the people involved. Carillion made people realise just how important prompt and fair payments are. We are seeing improvements in payment performance, but there is still a great deal to do, especially for smaller suppliers.

Building safety is being scrutinised so we do not repeat the failures that led us to the Grenfell disaster. And here in the UK it feels like we are just starting to emerge from Covid-19, and I trust things are improving for you too. Construction and NEC users in particular have responded well to the pandemic. Developments such as the Site Operating Procedures (CLC, 2021) have shown we can work collaboratively for the good of all. I believe that this collaboration and integration – which is at the heart of all NEC contracts − will continue transforming the sector.

NEC users and the construction industry generally continue to face challenges in the short and long term. Availability of building materials is becoming a serious concern and we are going to need to be smart in the way we procure our projects. Early engagement with supply chains and product manufacturers is going to be critical.

Over the longer term, there is the huge challenge to deliver net zero greenhouse gas emissions by 2050 and the way we procure and think about construction as part of a circular economy will help to shape this.

Finally I would like to thank you, the NEC users, for your support, NEC global head Rekha Thawrani for giving me the opportunity to be your chair, NEC’s Cheryl Waterman for supporting and steering me in this role and keeping me on track in Hong Kong, and of course Jane Halestrap from the Infrastructure and Projects Authority who has supported me behind the scenes and made my role over the last three years much easier. It just leaves me to hand the baton to John Welch, who I know will be a great chair for you. Thank you and my best wishes to you all.