22 May 2003
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The London Borough of Haringey has introduced a ground breaking £2.2 million maintenance contract developed by City lawyers, Trowers & Hamlin in association with Haywards Property Services, one of the borough’s panel building consultants. This project is being promoted to become a Demonstration Project with Movement 4 Innovation, part of the Rethinking Construction agenda by illustrating innovation and best practice in procurement.
The contract, the first of its type in the country, is designed to produce cost savings over traditional contracts, eliminate contractors’ pricing risks on emergency breakdown work and improve services.
Known as the TPC2001 Multi-Party Term Partnering Contract, the initiate is for a three-year period and covers gas servicing of some 17,500 boilers and gas appliances in residential homes and civic and public buildings.
There is provision for a further two-year extension, subject to contractors meeting key performance indicators (KPIs).
Under the contract, the council anticipates receiving annual cost-savings over the duration of the term, while the contractors - Integral, Purdy Contracts and TSG Building Services - will have their pricing risks eliminated and the opportunity to provide continuous improvement to their customer services.
Ian Sarchett, Director of Haywards Property Services, said: “For the past four years, we have worked closely with Haringey including resident representation, as their building consultants, more recently looking at service initiatives from a partnered basis.
“Under the new contract, the council’s in-house team of engineers will undertake the audit and valuation function while we will continue as the Partnering Advisor to the Strategic Core Group following our now completed pre-contract work,” said Ian Sarchett.
Traditionally, contractors include an annual fixed figure for providing breakdown and call-out services without knowing the exact level of cover ultimately required. Consequently, this element of a contract has tended to be priced at a premium rate to cover the contractors’ risk. Under TPC2001, contractors price a schedule of rates for these services and will be reimbursed by Haringey for actual levels of work completed at cost plus their tendered fixed profit and overhead costs.
Work orders and breakdown costs are monitored and audited on an open book basis with the council’s engineers having open access to the contractors’ IT systems and paperwork.
Sarchett added: “The element of pricing risk is, therefore, removed for the contractor and a true price is established for the council.”
For further information please contact:
Paul Desmond / Marylene Guernier
Tavistock Communications Ltd
Tel: 020 7600 2288
