Construction Procurement Reform

The Government in May 2004 decided to reform public sector construction procurement in Ireland. To address the reform measures introduced by Government a Capital Works Management Framework is being developed which includes a suite of six public works contracts and associated contract guidance notes. A Standard Conditions of  Engagement for Consultants and related procurement guidance material, have also been developed for service contracts.

Department of Finance Circular 33/06 sets out the implementation dates for the Public Works Contracts and Conditions of Engagement for Construction Consultants.

The Public Works Contracts and Conditions of Engagement will play a pivotal role in the Government’s value for money initiative introduced to achieve greater cost certainty, better value for money and more cost effective delivery of public works projects. The reforms when fully implemented will deal with all three key stakeholder areas in the construction delivery process. The three key areas being the Client, the Consultants and the Contractors. The Contracts and Conditions of Engagement address two of these and the third i.e. the Client area is addressed in the context of the Capital Works Management Framework.

THE PUBLIC WORKS CONTRACTS AND CONDITIONS OF ENGAGEMENT LISTED UNDER THE NAVIGATION PANEL HAVE BEEN DESIGNED SO THAT THE TEXT IS PROTECTED EXCEPT WHERE THERE ARE FORM FIELDS WHICH ALLOW THE DOCUMENTS TO BE TAILORED ELECTRONICALLY TO SUIT THE PARTICULAR REQUIREMENTS OF A PROJECT. SOME MINOR AMENDMENTS THAT AROSE AS A RESULT OF PUBLIC SECTOR TRAINING TOGETHER WITH CLARIFICATIONS HAVE BEEN INCLUDED IN THE FORMS. IN RELATION TO THE STANDARD CONDITIONS OF ENGAGEMENT GREATER FLEXIBILITY HAS BEEN INTRODUCED TO ALLOW CONTRACTING AUTHORITIES CHOOSE IN THE SCHEDULE FROM A NUMBER OF OPTIONS I.E. A SINGLE STAGE SERVICE, MULTIPLE STAGE SERVICE AND/OR THE CONTRACTING AUTHORITY CAN TITLE THE SERVICE IT REQUIRES.  

Note 1:

The Public Works Contracts and Conditions of Engagement for Consultants referred to above are to be used on all public sector projects where it is envisaged that either the traditional or design and build approach will be used. The finally designed versions of the Public Works Contracts and the Conditions of Engagement are displayed above and are to be substituted in all cases for the relevant version listed on this site except where a contract has been executed on the basis of an earlier version of the documents. It is important to note that the use of GDLA and the IEI third edition 1980 have been withdrawn from use on all public works projects so all public works contracts been awarded after 13 February 2008 must be awarded on the basis of one of the Contracts listed above.

It has been decided to continue the arrangement of making these Contracts and Conditions of Engagement available free of charge for the present.

Note 2:

It should be noted that foregoing Public Works Contracts and Conditions of Engagement replace all previous versions of the documents.

Note 3:

Guidance in relation to Model Form of Performance Bond (31 July 2007)

Claims by the Employer arising out of termination are dealt with under clause 12.2.11 of the Public Works Contract. If the Contractor fails to pay the Employer‘s demand for payment of such claims within 10 working days the Employer can invoke the first paragraph of Clause 1 of the Performance Bond which states: “If the Contractor’s obligations to complete the Works is terminated under clause 12.1 of the Conditions the Surety will, subject to this Bond, pay the Employer any amount for which the Contractor is liable under clause 12.2.11 of the Conditions.”

Other than termination, claims by the Employer for breach of contract shall be dealt with under Clause 10.9 of the Public Works Contract. Such claims once notice has been served and the Contractor’s response (if any) received shall be determined in accordance with the Contract by the Employers Representative. The Employer can offset such amounts against any amount due or likely to become due to the Contractor from the Employer under the Contract or any other Contract. Only if there are no, or insufficient amounts due or likely to become due should the Employer invoke the second paragraph of Clause 1 of the Performance Bond which states: “If the Contractor breaches the Contract the Surety will pay the Employer any amount for which the Contractor is liable to the Employer as damages for breach of the Contract, as established under the Contract, taking into account all sums due to the Contractor under the Contract.”

Note 4:

The Short Public Works Contract for Building and Civil Engineering works is an additional Contract to the existing suite of five Public Works Contracts. It is to complement the existing forms and will contribute to ensuring that appropriate measures are continually kept in place to ensure the effective implement the Government’s decision of May 2004 to reform public sector construction procurement.

This Contract must be used on works projects that have a value of €500,000 (including VAT) or less. However, if deemed appropriate, contracting authorities may continue to use the Minor Civil Engineering and Building Works Designed by the Employer contract instead of the Short Public Works Contract for projects with a value of €500,000 or less.

A Department of Finance Circular 04/08 issued on 13 February 2008 complements Circular 33/06 and which includes an implementation date (i.e. 3 March 2008) after which the Short Public Works Contract must be used on all projects with a value at or below the €500,000 threshold tendered on or after that date. Contracting authorities can up to that date use their discretion as to whether to use the Short Public Works Contract on works projects up to €500,000 in value.

Furthermore. as and from the 4^th February 2008 the phased implementation provisions referred to in sections 9, 10 and 11 of Circular 33/06: Construction Procurement Reform – revision of arrangements for the procurement of public works projects and for the engagement and payment of construction consultants are being withdrawn and will therefore no longer  apply.

Note 5:

Re  – Arbitration Rules for use with Public Works and Construction Services Contracts (30 April 2007) are being replaced with an updated version dated 30 January 2008.