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Staffordshire Fire & Rescue Service - Preventing, Protecting, Responding

Construction Procurement Activities in Last 12 Months

Reference No: 042/2014
Request Date: 09/04/2014

Request


Please note that the information requested relates to your construction procurement activities over the past 12 months.

  1. What monitoring and reporting do you have in place to check whether your main contractors are paying their sub-contractors within 30 days?
  2. If your response to Q1 is in the negative what other steps does your organisation take to ensure fair payment is applied along construction supply chains?
  3. Please provide information showing the average time taken by your organisation to discharge payments to your direct or main contractors?
  4. Do you apply a cash retention in your works contracts?
  5. If you apply a cash retention what use do you make of the cash whilst it’s in your possession?
  6. Have you or are you about to put in place project bank accounts on your construction projects?
  7. Please provide information about any plans which your organisation has for improving payment performance along the supply chain [e.g. making payments to sub-contractors within 30 days (of the main contract due payment dates) a pre-qualification requirement for lead contractors].
  8. Has your organisation been using PAS 91 as the pre-qualification standard to be the exclusion of other pre-qualification requirements?
  9. If you are not currently using PAS 91 as the exclusive route to pre-qualification does your organisation have plans to use PAS 91 (exclusively) in the future?

Response


The structure of a PFI contract means that the question posed in the FOI request is not really relevant. The Authority will only begin making payments for the project once the fire stations have been constructed and the facilities management services have begun to be provided.  There is no payment by the Authority to the building contractor or any sub-sub contractors during the construction phase of the project. The Authority will also be making payment to a special purpose vehicle, rather than directly to the construction contractor and sub-sub-contractors – which is the market approach to a PFI style deal.

Payment under the Building Contract are managed between the special purpose vehicle and building contractor and are essentially discharged on a milestone basis. As you will be aware operating within the construction industry, the way in which payments are made to construction contractors is regulated by the Housing Grants, Construction and Regeneration Act 1996. The Building Contract for this PFI project is drafted to be compliant with the payment and ‘pay less notice’ approach as set out in the aforementioned legislation. Other than carrying out limited due diligence of the construction arrangements prior to entering into the project, the Authority does not seek to monitor such payments under the building sub-contract as this is the for the special purpose vehicle to monitor and enforce.