Procurement in Independent Schools

Kevin Merris
Many independent schools include a sense of tradition among their core values, and this forms a key part of their value proposition for pupils and parents. But when it comes to capital projects, is traditional procurement best?

The quality of schools’ facilities typically plays a critical and competitive role in pupil/parent expectations, influencing pupil/staff recruitment and retention. Facility expansion, update or improvement may therefore be a key part of the business plan. When capital projects are funded by tuition fees, gifts and endowments, or property/land assets, value for money is important.

Whatever the estate strategy, or individual capital project, there will be a decision to be made on the most appropriate procurement route. Historically, the independent sector has favoured the traditional procurement approach, where the professional team is retained directly by the client. Tender and contract documentation are prepared by the design team to include full design, specification and bill of quantities which document the works to be carried out. A contractor is appointed to build what is documented and has no responsibility for design or the accuracy of the tender documents.

Facility expansion, update or improvement may therefore be a key part of the business plan.

This is in contrast to the commercial development sector, where design and build (D&B) is the norm. With this route, the architect is directly employed by the client at project outset, until the design is nearly completed. At this stage, the architect and often (but not always) the structural engineer and M&E consultant, are novated to the contractor, under whose authority they complete the design and produce detailed drawings. There is arguably less risk, as the contractor has responsibility for the design, as well as the materials and workmanship for which they are normally responsible in a traditional contract.

In this context, novation means that the client's contract with the consultant is transferred to the contractor, as if the contractor had been the client from the outset. Such novation offers distinct advantages for the school client: the school has full control over the design before novation, continuity of the same consultant post-novation, and can look to the contractor for single-point responsibility. However, the contractual documentation and the mechanism of the novation have to be considered carefully to avoid potential pitfalls.

Novation with ‘retained duties’ is a mechanism that works especially well and is generally the preferred option for independent schools seeking to use D&B. Here the architect (and often the structural engineer and M&E consultant) continues to support the school client with specified elements such as attending meetings and site inspections to check quality, while being primarily engaged by the contractor. The designers’ fees are usually apportioned between client and contractor.

Novation with ‘retained duties’ is a mechanism that works especially well and is generally the preferred option for independent schools seeking to use D&B.

One often overlooked advantage of D&B is the partnership ethos more likely to arise from this methodology. This more collaborative style of working can help sidestep the traditionally adversarial culture of the construction industry. For schools, this means less time and money spent resolving disputes and dissatisfactions, and smoother progress to building completion and operation.

Other D&B benefits are more widely recognised:

  • Reduced risk for school client
  • Faster programme, as stages of procurement/construction can be overlapped
  • Greater certainty of price – cashflow gains
  • One contractual (and day-to-day practical) point of contact

Can we expect to see more independent schools opting for D&B in the future? Thus far, the traditional nature of independent schools has led to the continued adoption of a traditional procurement/construction route and often a rejection of alternatives. Historically the architect, as a ‘professional’, may have seemed a more comfortable choice for consultation and decision-making – the contractor being seen as purely ‘the builder’.

It’s important to note that in both procurement routes, schools benefit from the use of an architect as lead consultant, whether the architect is novated with retained duties or traditionally employed.

At Faithful+Gould, our experience has been that each project or programme benefits from individual assessment and consideration, before a procurement option is selected. However, we anticipate that D&B will grow in popularity as bursars seek to realise maximum value (in cost, quality and schedule) from their capital projects.

Faithful+Gould has a long track-record of supporting independent schools with their capital projects. We are frequently appointed as project manager or employer’s agent, leading projects procured via traditional or D&B routes. We act with sensitivity towards the specific needs and culture of the independent schools sector, while ensuring that proposals and outcomes make sound business sense.

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