A survey of English universities’ construction procurement has revealed major concerns over payment and pre-qualification practices. They survey was carried out by the Specialist Engineering Contractors’ (SEC) Group using the Freedom of Information Act.
Key highlights of the survey showed that only 15% of English universities have monitoring arrangements in place to track payment performance in the supply chain; 60% of universities do not take any measures to ensure payment protection in the supply chain; 95% of universities still apply cash retentions; most universities use them to finance their other activities;and only 8% of universities use PAS 91 – the standard pre-qualification questionnaire.
SEC Group chief executive, Professor Rudi Klein, said: “Whilst most universities pay their tier 1 suppliers within 30 days, this performance is not necessarily being replicated along the supply chain. However there are a small number of university estates departments which have been very proactive in getting supply chain feedback on payment performance.
“It is also very disappointing that there is little attempt to standardise the pre-qualification process in the university sector. This is costing industry millions of pounds.”
The Public Contracts Regulations 2015 now require that universities ensure that 30 day payments are made along the supply chain to tier 3 contractors and that they use the standard pre-qualification questionnaire.
SEC Group represents a sector in the construction industry comprising 60,000 firms employing over 300,000 people. The sector is the largest in the industry (by value). The SEC Group member associations include; Plumbing and Heating Contractors’ Alliance, British Constructional Steelwork Association, Electrical Contractors’ Association, Building & Engineering Services Association, Lift and Escalator Industry Association and SELECT (Electrical Contractors Association of Scotland.